Welcome to the FIG Top 5 at 5

On 20 July 2026, the Central Bank of Ireland (“Central Bank”) published a consultation paper (“CP171”) on proposed refinements to the domestic actuarial regime and related governance requirements under Solvency II (“DAR”), together with corresponding guidance.

CP171 aims to gather the views of stakeholders on updates to the regulatory framework governing how (re)insurance undertakings manage their actuarial functions and technical provisions, with the Central Bank highlighting that the updates are targeted at “a clearer, simpler and more coherent regulatory framework whilst maintaining and strengthening resilience in the financial system.”

Background

The DAR has been in place since 2016 and since then the Irish insurance industry, CP171 highlights, has changed in terms of its complexity, interconnectedness and size. Additionally, there have been a number of regulatory developments, including, enhanced guidance on the fitness and probity requirements for the role of head of actuarial function (“HoAF”) – which is now a pre-approval controlled function – and the introduction of the Central Bank’s new supervisory approach.

Authorisation condition

CP171 proposes that the updated DAR will become a condition of authorisation for (re)insurance undertakings under the European Union (Insurance and Reinsurance) Regulations 2015.

Structure

Chapter 2 of CP171 contains a review of the DAR and related governance requirements under Solvency II, while chapter 3 includes a review of the guidance for (re)insurance undertakings on the HoAF role (“Guidance”). Chapter 4 sets out specific questions for consultation.

Changes to the DAR

In relation to the HoAF role, some of the matters highlighted / proposed are as follows:

• the Central Bank is of the view that it continues to be an appropriate requirement that responsibility for the tasks of the actuarial function is nominated to the HoAF;
• the Central Bank proposes to remove the elements of DAR that stipulate the employee status of the HoAF and the prerequisite level of experience as they overlap with the guidance provided as part of the fitness and probity regime. CP171 highlights that this is not a lessening of expectations and that, particularly in larger and more complex firms, the HoAF should be an employee;
• clarification that it is permissible to have separate HoAFs for life and non-life business for reinsurance undertakings;
• withdrawal of the requirement that the HoAF provides an opinion on the own risk and solvency assessment (“ORSA”). However, the HoAF will be expected to contribute to the ORSA process as part of the effective implementation of the risk management system.

As regards reserving policy, CP171 sets out the Central Bank’s view that it remains appropriate to have a reserving policy and highlights that the only change consists of minor wording changes to align with requirements in article 267.2 Commission Delegated Regulation (EU) 2015/35.

Exemptions from most of the additional DAR requirements are proposed to become automatic for:

• non-life firms that do not write certain classes of business; and
• life firms with small with-profits funds.

Such firms must notify the Central Bank that they fulfil the stated criteria for those exemptions.

When it comes to peer reviews, CP171 sets out that:

• the submission of peer reviews in respect of the actuarial report on the technical provisions (“ARTPs”) will become a regular requirement – the frequency of which will be determined by the undertaking impact classification that is performed in order to satisfy guideline 15 of the European Insurance and Occupational Pensions Authority’s guidelines on the supervisory review process. This is currently the prudential impact rating;
• the artificial scope boundaries that previously differentiated between high / medium high / medium low impact undertakings will be removed;
• some elements as to the scope of the peer review will be moved to the Guidance; and
• the restriction on the number of peer reviews that the same reviewing actuary, or another actuary from the same firm can perform in a row, is to be maintained.

In relation to the actuarial opinion on the technical provisions (“AOTPs”), CP171 makes minor changes to the requirements in relation to AOTPs, for example, to remove ambiguity about whether regulation 84(8) of the European Union (Insurance and Reinsurance) Regulations 2015 is a permission or a requirement.

As regards ARTPs, CP171 proposes to capture the objectives of the ARTPs within DAR, and to move the more detailed explanations of how the Central Bank expects the HoAF to meet those objectives into the Guidance. CP171 also proposes to make submission of an ARTP a regular requirement, rather than being provided “on request”.

CP171 also addresses life specific elements, highlighting that:

• the additional responsibility for the HoAF in direct life undertakings to monitor compliance with requirements relating to disclosure of information is no longer needed;
• as regards more clarity as to the scope of “Policyholders’ Reasonable Expectations”, CP171 sets out that the Central Bank will use wording that is more aligned with that used in the Consumer Protection Code – specifically General Principle 2.1; and
• the requirements in relation to with-profits business continue to be appropriate.

As regards non-life specific elements, CP171 highlights that the requirement for high impact undertakings that operate in the non-life sector to have a reserving committee remains appropriate. In that context, only minor changes to the wording are proposed.

Revised Guidance

Some of the matters highlighted, in the context of revisions to the Guidance, are as follows:

• the Central Bank’s general expectations of the HoAF Role are largely unchanged, and so the intent behind section 2 of the previous guidance is proposed to be kept, with drafting changes;
• the Central Bank’s expectations as to the approach taken to the opinion on underwriting, set out in section 3.1 of the previous guidance, are also mostly unchanged;
• as regards the expectations of the Central Bank on the opinion on reinsurance arrangements, set out in section 3.2 of the previous guidance, the only change is the removal of an expectation that the HoAF comment on the motivation for the reinsurance or that they offer alternatives to the reinsurance;
• due to the fact that CP171 proposes to remove the requirement for the HoAF to provide an opinion on the ORSA, the wording around the expectations on contribution to effective risk management, set out in section 3.3 of the previous guidance, has been amended to reflect the areas of the ORSA that the HoAF may consider themselves to be well placed to make a contribution; and
• the proposed wording in relation to the scope and content of the peer review and content of the peer review report are now set out in the Guidance in a new section 4.

Next Steps

CP171 is open for feedback until 20 October 2026. The Central Bank welcomes views on all proposals and on the specific questions set out in chapter 4. A feedback statement will be published in due course.

On 17 July 2026, the European Commission (“Commission”) adopted a communication (“Communication”) on the competitiveness of the EU banking sector and the single market in banking.

The Communication, which sets out the main challenges that impede the banking sector’s competitiveness and limit its contribution to the EU economy, delivers on the commitment in the savings and investment union strategy to assess the sector’s competitiveness.

Additionally, the Communication outlines measures aimed at addressing those challenges, focused on:

• connecting savings to investments more efficiently;
• better exploiting the potential of both cross-border and domestic markets; and
• ensuring that households and businesses have the widest choice of financing options, lowest costs and highest returns.

The Communication highlights that a more competitive banking sector must be resilient, profitable and open to competition and innovation.

The Commission consulted on the matter in February 2026 – for more information, see FIG Top 5 at 5 dated 19 February 2026.

Challenges identified

Three main challenges, that are holding back the full potential of the banking sector to support the EU economy, have been identified:

• EU banking markets are fragmented along national lines – this limits scale and cross border activity, reduces competition and impedes the ability of banks to provide services to businesses and households across the EU. In addition, this fragmentation prevents EU banks from reaching the necessary scale so that they can compete with third-country banks in important market sectors, for example, in investment banking;
• implementation of global standards that leads to an uneven playing field – the transposition of the Basel III standards into the EU framework does not always reflect the specific features of the EU banking landscape, with those standards being applied to the smallest banks also, albeit with some proportionality. The Communication highlights that the framework needs to work better for both large and small banks; and
• some EU banking rules are unduly complex – certain elements of the regulatory framework applying to EU banks, including reporting requirements, are unnecessarily complex and burdensome and should be simplified. It is also highlighted that other areas of the regulatory framework could be made more proportionate.

Proposed actions

The measures proposed in the Communication are centred around three objectives:

• removing barriers to cross-border banking activity and fostering market integration – measures proposed here relate to: 

• • allowing cross-border banking groups that are well integrated to allocate capital and liquidity more efficiently across the EU, so that they can redirect excessive resources to where they would be most productive for the economy;
  • the Communication emphasises the importance of strong and common safeguards in times of crisis and, in that regard, proposes to replace the 2015 proposal for a European Deposit Insurance Scheme with a new proposal to simplify the deposit insurance framework; and
  • closer monitoring of EU anti-money laundering and consumer protection frameworks and their national implementation, with it being highlighted that this would make it easier for banks to offer services across borders.

• implementing international standards while taking into account EU specificities and proportionality – highlighting that the EU has been applying Basel III standards since January 2025, and remains committed to these standards, the Commission will, nonetheless,  implement them in a way that takes the specific features and diversity of the EU banking system into account. The Communication sets out that: 

• • there will be further proportionality for smaller banks, including the possible adjustment of criteria and thresholds for “small and non-complex institutions” and adaptation of their requirements;
  • the Commission will assess the impact of the output floor, which is the backstop for excessively low modelled capital requirements; and
  • the Commission will look at transitional arrangements for mortgage loans and loans for unrated corporates, emphasising that this is important for households and SMEs.
    

• simplification of the regulatory framework for banks as part of the Commission’s wider objective of reducing administrative burden – in this regard, the Communication sets out that the Commission will: 

• • make bank-specific capital requirements (Pillar 2 requirements) and supervisory guidance more transparent and targeted;
  • simplify and further harmonise macroprudential and resolution buffers;
  • encourage authorities to improve their coordination mechanisms so that they set prudential requirements in an ever-more coordinated way; and
  • introduce targeted changes enabling the European Banking Authority to deliver further proportionality, simplification and automation of bank reporting.

Welcoming the publication of the Communication, Ursula von der Leyen, President of the Commission, stated:

“Getting capital flowing is how we will get Europe growing. Our Savings and Investments Union needs a strong, competitive banking sector at its heart. And today’s Communication takes a clear step in this direction, recalibrating our approach to risk, and enabling growth and innovation while maintaining financial stability.”

Supporting publications

The Commission has also published a number of supporting materials related to the Communication, such as, a Q&A, a factsheet and a recording of the press conference.

Next Steps

The Commission welcomes further feedback on the Communication. In Q1 2027, the Commission will propose a package of measures to amend the banking regulatory framework and to implement the measure set out in the Communication. Alongside this, the Commission calls on member states, supervisory authorities, and the banking industry, to continue to improve their own efforts to improve banking competitiveness. 

1. EIOPA publishes final set of guidelines and draft technical standards under amended Solvency II

On 15 July 2026, the European Insurance and Occupational Pensions Authority (“EIOPA”) published eight sets of guidelines and technical standards regarding the review of the Solvency II framework.

In a related press release, EIOPA confirms that this latest publication means that all legal instruments, that EIOPA was mandated to develop under the review of Solvency II, have now been published. 

The published instruments are as follows:

Final report on guidelines on supervisory powers to remedy liquidity vulnerabilities;

Final report on regulatory technical standards (“RTS”) on simplified calculation of the risk margin;

Final report on revised guidelines on valuation of technical provisions;

Final report on revised implementing technical standards (“ITS”) on the matching adjustments;

Final report on revised guidelines on ring-fenced funds;

Final report on revised ITS on disclosure templates for national supervisory authorities (“NSAs”);

Final report on revised Guidelines on group solvency; and

Final report on revised Guidelines on reporting and disclosure.

Consultations

EIOPA consulted on the revised ITS on disclosure templates for NSAs, the revised ITS on the matching adjustments, the revised guidelines on valuation of technical provisions, the revised guidelines on ring-fenced funds, the RTS on simplified calculation of the risk margin and the guidelines on supervisory powers to remedy liquidity vulnerabilities, in October 2025 – for more information, see FIG Top 5 at 5 dated 16 October 2025.

The revised guidelines on group solvency calculations and reporting and the draft revised guidelines on reporting and public disclosure, were consulted on in December 2025 – for more information, see FIG Top 5 at 5 dated 11 December 2025.

Next Steps

All of the instruments, set out above, have been submitted to the European Commission – it will decide on their adoption within three months. In line with the amended Solvency II directive, the instruments will apply from 30 January 2027.

 2. Commission adopts delegated regulation on RTS under amended Solvency II directive

On 16 July 2026, the European Commission (“Commission”) adopted a delegated regulation (“Delegated Regulation”), supplementing the Solvency II directive, setting out regulatory technical standards (“RTS”) in relation to:

• the specification of the factors to be considered to identify undertakings that are under dominant or significant influence and undertakings that are managed on a unified basis. The Delegated Regulations details the four factors listed in article 212(4) of the Solvency II directive, being control or ability to influence decisions, strong reliance, coordinated financial or investment decisions, coordinated and consistent strategies setting supporting elements specifying those factors. Further the Delegated Regulations sets out that: 

• • national supervisory authorities are required to evaluate the significance and continuity of those supporting elements on a case-by-case basis, basing their decisions on a body of evidence rather than on standalone conditions; and
  • the Delegated Regulation will, by providing clear criteria for identification, promote supervisory convergence and support effective and efficient group supervision.

• the specification of the conditions and criteria to be used to determine which activities carried out by insurance and reinsurance undertakings under the right of establishment or under the freedom to provide services are of relevance with respect to the host member state’s market. In this regard, the legal framework focuses on the concentration of activities and their material impact on policyholders and financial stability.

EIOPA published final reports on the RTS in July 2025 – for more information, see FIG Top 5 at 5 dated 17 July 2025.

Next Steps

The Delegated Act will be published in the official journal of the EU and enter into force if the European Parliament or the Council of the EU do not object to it.

1. ESMA publishes statement on T+1 preparations

On 20 July 2026, the European Securities and Markets Authority (“ESMA”) published a statement (“Statement”) on preparing for the EU T+1 settlement cycle for transactions on transferable securities under the central securities depositories regulation (“CSDR”). The Statement also details some key deadlines and action points.

In October 2025, Regulation (EU) 2025/2075 (“Regulation”) as regards a shorter settlement cycle in the EU was published in the official journal of the European Union – for more information, see FIG Top 5 at 5 dated 23 October 2025.

The Statement highlights that the implementation of the changes related to the transition to a T+1 settlement cycle must be prioritised by EU market participants in 2026, with the transition due to take effect on 11 October 2027. 

Some of the matters set out in the Statement are as follows:

• the EU T+1 committee (“Committee”) has carried out two readiness surveys which indicate that, overall, awareness and commitment to the T+1 transition process is good but that there are uneven implementation levels across EU financial markets, sectors and firms;
• ESMA and national competent authorities (“NCAs”) will be closely monitoring firms’ compliance with the related regulatory requirements once they come into effect over the coming months;
• ESMA’s proposed amendments to Commission Delegated Regulation (EU) 2018/1229 have now been endorsed by the European Commission and are currently being scrutinised by the European Council and the European Parliament. These amendments set new requirements that are especially relevant for the T+1 transition with the Statement highlighting that they should be considered by firms, together with recommendations of the Committee; and
• ESMA and NCAs are in the last stages of their review of the level 3 guidance on allocations and confirmations, which will give firms a clear basis for finalising their implementation of electronic, standardised and timely allocation and confirmation processes.

Deadlines

The Statement highlights that market participants need to be fully compliant with reference to the following deadlines:

• 7 December 2026 for the requirements to improve the first post-trade step, the exchange of allocations and confirmations, in terms of timing and through the default use of international communication standards; and
• 11 October 2027 for requirements to optimise the settlement layer, including, matters such as, sending instructions early enough to securities settlement systems.

Action points

Some of the recommendations in the Statement, as regards action to be taken, include:

• automation and standardisation are essential, and accordingly, firms are encouraged to review all their trading and settlement processes and where relevant, to consider new partnerships;
• ensuring data quality in a timely manner is also important, for example, using the correct reference data including through standard settlement instructions; and
• firms should assess the readiness of their entire ecosystem up and down the trading and settlement chain in order to identify defects early and reduce the risk of disruption at go-live.

 2. ESMA publishes follow-up report to 2022 peer review report on supervision of cross-border activities under MiFID II

On 20 July 2026, the European Securities and Markets Authority (“ESMA”) published a follow-up report (“Report”) to its 2022 peer review (“Peer Review”) on the supervision of cross-border activities of investment firms.

The Peer Review addressed the supervision of cross-border activities of investment firms and credit institutions targeting retail clients, under the freedom to provide investment services. The Report provides an update on the actions that national competent authorities (“NCAs”) in the Netherlands, Germany, the Czech Republic, Luxembourg, Cyprus and Malta, undertook to address the findings and recommendations of the Peer Review. The Peer Review had identified shortcomings in the authorisation, supervision and enforcement related to the supervision of cross-border activities of investment services, with different severity across the six NCAs.

The Report highlights progress in three main areas:

• as regards authorisation controls, the Report found tangible improvements by the five NCAs relevant to this recommendation, with earlier identification of cross-border risks and more robust gatekeeping;
• with reference to supervisory activities, the Report highlights clear progress in the integration of cross-border activities into risk-based supervisory frameworks. The Report also points to enhanced data collection and analytics for all NCAs, with most having embedded cross-border indicators into their risk-scoring models, to support determining supervisory priorities, the intensity and frequency of monitoring, and the selection of firms for investigations and on-site inspections; and
• the use of diverse and agile supervisory tools for cooperation among NCAs since the Peer Review, whereby NCAs have undertaken more targeted supervisory actions, reported enforcement cases where relevant and strengthened cooperation.

Next Steps

ESMA advises all NCAs, particularly those with significant outward cross-border activities, to reflect on the conclusions in the Report. ESMA highlights that it will maintain its focus on fostering supervisory convergence, enhancing cooperation among national supervisors and supporting data-driven, risk-based supervision, especially in a context where retail cross-border investment services continue to expand.

1. EBA consults on amendments to ITS on benchmarking of internal models and standardised approach for market risk for 2027 exercise

On 17 July 2026, the European Banking Authority (“EBA”) published a consultation (“Consultation”) on draft implementing technical standards (“ITS”) on amending commission implementing regulation (EU) 2016/2070 with regard to the benchmarking of approaches for calculating own funds requirements in connection with the 2027 market risk benchmarking exercise.

Article 78 of directive 2013/36/EU (“CRD”) requires competent authorities (“CAs”) to carry out an annual assessment of the quality of approaches used for the calculation of own funds requirements – the EBA calculates and distributes benchmark values, that allow a comparison of individual institutions’ risk parameters, to CAs to assist in their assessment.

The Consultation sets out the following suggested changes for the 2027 benchmarking exercise:

• updating the framework for the expanding scope of the market risk benchmarking exercise to institutions applying the alternative standardised approach under the CRR III Regulation This is regardless of whether an institution uses an internal model;
• resuming the collection of data using the internal model approach (“IMA”) under CRR II regulation;
• postponing the 2027 benchmarking exercise to the second half of 2027 to allow for the broader scope;
• postponing the collection of data using the alternative IMA under CRR III due to the uncertainty surrounding its effective implementation;
• reorganising and rationalising the market risk reporting templates to show progress in the implementation of the Fundamental Review of the Trading Book.

The EBA highlights that, although there are quite a number of proposed amendments, they are limited in substance and are mostly technical and practical.

Next Steps

In view of the targeted nature of the proposed amendments, the EBA is consulting for a six week period only, with the Consultation closing on 3 September 2026. This shorter timeframe will, the EBA explains, allow for the final ITS to be adopted at an earlier stage which will give newly included institutions more time to prepare for the 2027 exercise.

The EBA will hold a public hearing on 28 July 2026 – interested parties can register here.

2. EBA publishes final draft RTS and ITS on material acquisitions, material transfers, mergers and divisions under CRD IV

On 17 July 2026, the European Banking Authority (“EBA”) published its final report (“Report”) on draft regulatory technical standards (“RTS”) and draft implementing technical standards (“ITS”) on material acquisitions, transfers of assets or liabilities, mergers and divisions involving credit institutions or (mixed) financial holding companies under the Capital Requirements Directive (“CRD”).

The RTS have been developed under article 27b of CRD, as amended by CRD IV, which mandates the EBA to further specify:

• the list of minimum information to be provided for material acquisitions, material transfers of assets and liabilities, mergers and divisions;
• a common assessment methodology of the criteria set out for the supervisory scrutiny of material acquisitions, mergers and divisions; and
• the process applicable to notification and the prudential assessment required for material acquisitions, mergers and divisions. 

In addition, there are two more mandates as regards ITS to foster cooperation where multiple authorities are involved in material acquisitions, mergers or divisions – the EBA has combined these mandates into one set of ITS due to their similarity and presented them with the RTS.

The RTS and ITS are targeted at supporting banking consolidation and deepening EU market integration by clarifying supervisory expectations, reducing regulatory uncertainty, and promoting a consistent prudential assessment framework across the EU.

The EBA has prioritised the principle of proportionality by streamlining the content of the notification or the assessment to be carried out. The EBA explains that the RTS avoid duplication by exempting institutions from submitting information already held by the competent authorities and, by leveraging documentation prepared under the Company Law Directive. Information requirements and assessment are further simplified for intra-group material transactions. 

Next Steps

The draft RTS and ITS will be submitted to the European Commission for endorsement, following which they will be scrutinised by the European Parliament and the European Council, before being published in the official journal of the EU.