EBA review finds high Pillar 3 compliance, urges consistency
The European Banking Authority's peer review found high compliance among competent authorities in implementing and supervising Pillar 3 disclosure requirements. The review, covering June 2023 to June 2025, identified that most requirements were largely incorporated, with some supervisors achieving very high standards.
Supervisors largely meet Pillar 3 standards
The EBA conducted a targeted peer review of six competent authorities, including the ECB/SSM, from June 2023 to June 2025.
The review assessed the effectiveness of integrating, supervising, assessing, and ensuring compliance with Pillar 3 disclosure requirements under CRR and BRRD.
It found that most requirements were fully or largely incorporated into supervisory frameworks, with three authorities achieving a very high standard.
This indicates a strong overall commitment to prudential disclosures and market discipline across the EU.
The methodology aimed for a balanced group, including both SSM and non-SSM jurisdictions with institutions of various sizes, to provide a comprehensive overview of the current supervisory landscape.
Inconsistencies and divergent priorities
Despite the generally positive findings, the review highlighted areas of inconsistency and divergent approaches among supervisors.
One competent authority was rated 'partially applied' across all benchmarks, indicating significant deficiencies in their processes to supervise and monitor Pillar 3 requirements.
Another supervisor was mostly rated 'not applied', explicitly lacking specific assessment methodologies.
This authority deemed Pillar 3 non-compliance not a significant risk to financial stability, focusing resources elsewhere.
The EBA will conduct a follow-up peer review in two years to assess the implementation of recommended measures.
Compliance is not convergence
The EBA's findings underscore a persistent challenge: formal compliance does not equate to supervisory convergence.
The varied application and explicit de-prioritization of Pillar 3 by some authorities reveal fundamental gaps in market discipline.
The upcoming follow-up review will be critical to assess if these inconsistencies can truly be resolved.