Deal Reached to Finalize EU Reforms of Banking Rules Addressing Crypto Risks
Representatives of the European Parliament, the Council, and the Commission have reached a provisional agreement to amend EU regulations on capital requirements for banks. The changes aim to make EU banks more resilient to economic shocks by implementing the Basel III global standards while considering European specifics.
- The Basel III global standards for bank capital adequacy, stress testing, and liquidity requirements will be implemented in the European Union.
- A transitional regime for crypto assets will be established, requiring banks to disclose their exposure to cryptocurrencies and other digital assets.
- The European Commission will assess the overall state of the banking system in Europe’s single market by the end of 2028 and report on the appropriateness of the Union regulatory and supervisory frameworks for banks.
- The European Parliament’s Committee on Economic and Monetary Affairs (ECON) must approve the latest agreement.
- The deal follows the approval of the EU’s new Markets in Crypto Assets (MiCA) law in April, which introduces comprehensive regulations for the crypto industry in Europe.
Overall, this deal signifies a significant step towards strengthening the regulatory framework for banks in the European Union, with a focus on addressing the risks associated with cryptocurrencies and digital assets. By aligning with Basel III standards and implementing the transitional regime for crypto assets, EU banks aim to enhance their resilience to economic shocks. The assessment of the banking system and the approval of the agreement by ECON will further contribute to the stability of the European banking sector.
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