ECB Eases Governance Expectations For Banks, Reviews Supervisory Guidance

The European Central Bank (ECB) has announced changes to its supervisory framework, including the withdrawal of several guidance documents and revisions to its governance expectations for banks as part of efforts to reduce regulatory burden.

The ECB said it will retire around 40 supervisory publications that it considers outdated. These include guidance issued during the COVID-19 pandemic, such as restrictions on dividend payments, as well as recommendations related to data collection and reporting. The central bank will also replace a draft guide on governance and risk culture with a report outlining good practices. Unlike the draft guide, the report will not be binding, allowing banks to adopt alternative approaches if they comply with applicable legal requirements.

The ECB said it is also reviewing other supervisory guides, including those covering lending practices, with the review expected to conclude by the end of the year. The changes are intended to simplify supervisory expectations while maintaining oversight of the banking sector.