FIG Top 5 at 5 - 09/10/2025

DATE: 09/10/2025

1. Deputy Governor Mary-Elizabeth McMunn Delivers Speech on Regulation and Supervision in an Uncertain World

On 3 October 2025, Deputy Governor at the Central Bank of Ireland (“Central Bank”), Mary-Elizabeth McMunn, delivered a speech (“Speech”) at the Compliance Institute’s annual conference. The theme of the speech centred around the cycle of regulation and supervision in an uncertain world.

Risk Environment

The Deputy Director discussed the risk environment that financial services are operating in, noting geopolitical change, rapid, technological progress and climate change as matters that could profoundly affect the economy and financial system, highlighting that the scale of those changes has accelerated this year.

In this regard, Ms McMunn reiterated that we need to be prepared for short and long term shocks, stemming not only from traditional risks, but also from novel ones. She highlighted “vigilance, resilience and agility” as key words for the period to come.

Seizing Opportunities While Managing Risks

The Deputy Director pointed to the challenges associated with taking advantage of opportunities while managing the risks, particularly highlighting the extra challenge presented by the fact that we are currently faced with managing both significant risks and uncertainty in the near term, while adapting to an accelerated transition to a more long-term different world.

In this regard, Ms McMunn discussed the impact of risks crystallising via traditional risk channels, such as, credit, liquidity, market risks, as well as business model and operational risks while also ensuring that resulting risks to consumers are managed.

Ms McMunn noted that we are also faced with potential continuation of the recent trend towards longer term geoeconomic fragmentation.

However, the Deputy Governor emphasised that our commitment to open markets and Ireland’s international financial sector is a factor that will enable the seizing of opportunities, even in the current climate.

When it comes to digitalisation, the Deputy Governor highlighted the benefits associated with the digital transition, if done correctly, noting that capitalising on the potential benefits is crucial for financial services firms and their consumers.

In terms of climate change, Ms McMunn expressed the sentiment that the challenge in that area only appears to be increasing. Noting the risks stemming from climate change, Ms McMunn also highlighted opportunities arising from the transition to a net zero economy, and that the financial sector has a significant role to in play in mobilising private finance as part of this solution.

Response to Uncertainty?

The Deputy Director highlighted various matters as regards responding to uncertainty and change, some of which are as follows:

the roles of regulators, supervisors and compliance officers are all the more important;
the importance of effective risk management and governance, supported by a strong ethical culture and a proactive approach as regards managing risks and uncertainties, including active consideration of customer interests;
compliance should be regarded as key an enabler of well-run businesses;
the regulatory framework needs to be adaptive in the context of a changing external environment. Here, the Deputy Governed cited two examples:
- the Consumer Protection Code (“CPC”), where the review focused on modernising the CPC to reflect the provision of financial services in the modern world; and
- DORA, noting the significant efforts involved in the submission of the registers of information but highlighting the benefits of those efforts in that it will provide key information on the ICT third-party service providers to regulated entities, and those that are critical to the system.

The Deputy Governor also touched on the Central Bank’s response to change, highlighting the Central Bank’s emphasis on being more open and engaged in a world where communication and engagement are all the more important, urging the financial sector to also communicate with the Central Bank if clarifications are needed or issues need to be raised.

Simplification Versus Deregulation

The Deputy Director highlighted the importance of the role of regulation in the economy and the financial system, noting that it supports competition, innovation and productivity.

Taking account of the focus on competitiveness, Ms McMunn reflected that the renewed focus on the regulatory framework is no surprise, especially in terms of simplification. She expressed the support of the Central Bank for simplification, noting engagement at a European level and domestically.

Importantly, the Deputy Director cautioned against simplification to the point that complex risks are not captured – all the more pertinent in a context where financial regulation is complex, in part, because financial services are complex.

Ms McMunn then gave some examples of simplification efforts, as follows:

more integrated engagement through the Central Bank’s new supervisory approach;
enhanced fitness and probity and authorisation processes;
consulting on amendments to the funds framework; and
streamlining reporting requests.

2. Deputy Governor at the Central Bank Colm Kincaid delivers speech focused on financial wellbeing

On 2 October 2025, Deputy Governor for Consumer and Investor Protection at the Central Bank of Ireland (“Central Bank”), Colm Kincaid, delivered a speech (“Speech”) at the Financial Services Ireland chief executive roundtable. The Speech focused on the future financial wellbeing of consumers, investors and the wider financial system.

Better Support for Consumers and Investors

The Deputy Governor highlighted some changes introduced by the Central Bank aimed at better supporting consumers and investors, such as the new supervisory approach, noting that the move to the new approach takes account of the fact that changes in the financial system need a more holistic approach across multidisciplinary teams to best deliver on the Central Bank’s supervisory priorities.

Mr Kincaid particularly emphasised that the new supervisory approach does not change protections for consumers and investors nor does it dilute the high standards that the Central Bank expects of regulated firms to secure their customers’ best interests. For more information on this new approach, see FIG Top 5 at 5 dated 6 March 2025.

In terms of the new Consumer Protection Code (“Code”), he noted that, together with the new supervisory approach, the Central Bank is “raising the bar in terms of the protections consumers and investors should receive.”

The Deputy Governor also noted that there is further work to be done in this space, such as implementing enhancements stemming from the OECD review of the Central Bank’s consumer protection supervisory functions, for more information, see FIG Top 5 at 5 dated 19 December 2024.

Priority Themes

Reinforcing the fact that consumer protection is at the centre of everything the Central Bank does, Mr Kincaid went on to highlight three high level themes, as regards the upcoming work of the Central Bank, from a consumer and investor protection perspective, as follows:

how firms operate and the consumer / investor experience, some matters highlighted include:
- the Central Bank will complete its review of the handling of customer complaints to ensure firms raise their standards in advance of the new requirements of the revised Code coming into force;
- supporting the Government’s action plan on insurance reform so as to improve how investors access capital markets to provide for their future; and
- enhancements as to how the Central Bank uses its conduct of business returns and other data to better target and plan its supervisory engagements.
digitalisation – under this heading some of the matters highlighted by the Deputy Director include:
- the Central Bank innovation hub;
- the innovation sandbox programmes;
- implementation of the Code’s requirements for digital financial services; and
- a continued focus on enhancing operational resilience, especially in the context of the disruptive effect of service interruptions on consumers.
financial crime – some matters highlighted by the Deputy Director under this priority include:
- the Central Bank will continue to raise awareness as regards financial scams and fraud, also making use of its status as a trusted flagger to require criminal content to be taken down by online platforms; and
- a focus on assessing fraud detection and prevention controls in mobile apps and other payments services .

Challenges

The Deputy Director referenced the founding legislation of the Central Bank, where it is stated that “the constant and predominant aim of the Central Bank shall be the welfare of the people as a whole”. In this context, he noted that the risks to the welfare of the people as a whole are changing. Mr Kincaid then went on to highlight four “essential components” necessary to make progress in the face of such challenges, as follows:

all involved in financial services must support a “better social conversation on financial well-being” – here, Mr Kincaid pointed to the Central Bank’s work at the G20 / OECD working party on Financial Consumer Protection, Education and Inclusion.
He also discussed the role that other organisations have to play in financial wellbeing, such as the Competition and Consumer Protection Commission, the Financial Services and Pensions Ombudsman and the Money Advice and Budgeting Service.
However, Mr Kincaid emphasised that it is the financial services industry who plays the most direct role a regards supporting the financial wellbeing of consumers and investors.
the rules should support a shared vision of financial well-being – some matters highlighted here include that it will be a priority for the Central Bank that regulated entities implement the reforms on foot of the revised Code.
Additionally, he noted that the Central Bank will shortly be consulting on the extension of the Code to credit unions’ core activities.
The Deputy Director also urged regulated entities to take a customer centric approach.
a recognition that consumers and investors have a responsibility to look after their own financial wellbeing but need to be supported to do so – some matters highlighted include:
- the modernising of the concept of vulnerability in the Code;
- supporting the National Financial Literacy Strategy.

3. Commission Letter to ESAs Advising of De-prioritisation of Certain Level 2 Acts in Financial Services Legislation

On 6 October 2025, the European Commission (“Commission”) published a letter dated 1 October 2025 (“Letter”) addressed to the European Supervisory Authorities (“ESAs”) and the Anti-Money Laundering Authority (“AMLA”).

The Letter notes the increase in legislation in the financial services context, highlighting that the level 1 acts adopted by the co-legislators during 2019 – 2024 has led to the Commission being empowered to adopt 430 level 2 acts.

Simplification

In pursuit of its simplification agenda, the Commission has divided the 430 level 2 acts into three categories:

empowerments where the Commission is legally required to act within a specified timeframe;
empowerments where the Commission is legally required to act without a specified timeframe; and
empowerments where the Commission is not legally required to act.

Non-essential

Ultimately, following consultation with the European Parliament and the European Council and discussions with the ESAs and the ALMA, the Commission has categorised 115 of the 430 level 2 measures as non-essential for the effective functioning of the level 1 legislation and for the achievement of EU policy objectives.

The non-essential measures are set out in an annex (“Annex”) to the Letter.

Two-step Approach

The Letter outlines the Commission’s two-step approach to these non-essential measures, going forward, as follows:

the Commission will not adopt the non-essential level 2 acts listed in the Annex before 1 October 2027;
secondly, the Commission will propose to amend or repeal the empowerments for the non-essential Level 2 acts where there is an obligation to act within a specified deadline in the context of any ongoing amendments of relevant level 1 acts. In this regard, the Letter highlights that a substantial number of the relevant level 1 acts will be subject to review within the next two years.

Affected Legislation

As stated above, the non-essential measures are set out in the Annex and relate to the following:

CRD - 2013/36/EU
There are three level 2 measures listed as non-essential.
CRR - (EU) 575/2013
There are six level 2 measures listed as non-essential, for example regulatory technical standards (“RTS”) on the conditions and the criteria according to which an institution may be allowed not to count an overshooting and RTS on proxy spreads.
CSDR - (EU) 909/2014
There are seven level 2 measures listed as non-essential, from a delegated act (“DA”) concerning measures to further specify the non-banking-type ancillary and the banking-type ancillary services to an implementing act (“IA”) on the suspension of the buy-in mechanism.
EMIR - (EU) 648/2012
There are eight level 2 measures listed as non-essential. Examples include a DA on central banks exemptions and RTS on the periodic review of the clearing thresholds.
MAR - (EU) 596/2014
Here, there is one level 2 measure listed as non-essential, namely, ITS specifying the technical details to establish appropriate mechanism for the exchange of order book data.
MIFID - 2014/65/EU
There are five level 2 measures listed as non-essential, such as, a revised DA amending the Delegated Regulation 2017/565 on order execution policy, reasonable commercial basis and a DA on market capitalisation thresholds and free float.
MIFIR - (EU) 600/2014
There are eight level 2 measures listed as non-essential. Examples include ITS on systematic internaliser notification / RTS on suitability of management body of data reporting service providers / MiFIR Review RTS 23 - reference data reporting.
Multiple Vote Share Directive - (EU) 2024/2810
There is one level 2 measure listed as non-essential, namely, RTS on a marker for companies that have multiple vote share structure.
Prospectus Regulation - (EU) 2017/1129
There are four level 2 measures listed as non-essential, such as, a DA specifying further the conditions for equivalence set out in article 29(4) and ITS specifying the template and layout of prospectuses, including the font size and style requirements, depending on the type of prospectus and the type of investors targeted.
SFDR - (EU) 2019/2088
There are ten level 2 measures listed as non-essential. Examples include:
- revised RTS on transparency of the promotion of environmental or social characteristics and of sustainable investments on website;
- revised RTS on transparency of sustainable investment for financial products having sustainable investment as their objective;
- revised RTS on the principle of do no significant harm; and
- revised RTS on transparency of investment in environmentally sustainable economic activities (EU Taxonomy) in periodic reports.
Solvency II - 2009/138/EC
There are twenty five level 2 measures listed as non-essential, as follows:
- RTS on identification of exceptional sector-wide shocks;
- RTS on management of sustainability risks including sustainability risk plans;
- ITS on method for the prudent deterministic scenario;
- DA on USPs - subset of standardised parameters;
- DA on USPs - standardised methods;
- DA on special purpose vehicles;
- DA on groups with CRM – procedures;
- DA on groups with CRM - emergency situations;
- DA on groups with CRM – criteria;
- DA on extension of the recovery period - factors and criteria;
- DA on equivalence for 3rd country reinsurers – criteria;
- DA on equity charge transitional;
- DA on definition of a significant branch;
- DA on criteria for the equity index;
- DA on criteria for regional sub-group supervision;
- DA on colleges - identification of group supervisors 'in the event that any major difficulties arise';
- DA on changes in the group solvency when various transitionals are used in groups;
- DA on capital add-on – methodologies;
- DA on capital add-on – circumstances;
- DA on PPP - risks related to derivatives;
- DA on legal form of the insurance or reinsurance undertaking;
- DA on extension of deadlines in exceptional circumstances;
- DA on equivalence – criteria under article 227(3);
- DA on equivalence – criteria under article 260(2); and
- DA on criteria for national sub-group supervision.
Accounting Directive - 2013/34/EU
There are eight level 2 measures listed as non-essential, for example, DA on sector-specific European Sustainability Reporting Standards and IA on machine-readability for certain documents in the Accounting Directive (ESAP).
AIFMD2/UCITSD6 - (EU) 2024/927
There are three level 2 measures listed as non-essential, such as, RTS on open-ended loan originating funds and ITS on procedures for exchange of information between NCAs, the ESAs, the ESRB, and members of the ESCB.
AMLA Regulation - (EU) 2024/1620
There is one level 2 measure listed as non-essential, namely, ITS on the format for reporting of information by AMLA to the European Public Prosecutor's Office.
AMLD - (EU) 2024/1640
There are four level 2 measures listed as non-essential, for example, RTS on general conditions for the functioning of AML / CFT supervisory colleges in the financial sector.
Audit Directive - 2006/43/EC
There are three level 2 measures listed as non-essential, such as, DA on standards for the limited assurance of sustainability reporting.
ESG ratings Regulation - (EU) 2024/3005
There are six level 2 measures listed as non-essential, for example, RTS on content and information to be disclosed for SFDR ESG ratings and ITS to specify the data standards, formats and templates for methodology disclosures to users and rated items.
Transparency Directive - 2004/109/EC
There are four level 2 measures listed as non-essential, such as, an IA on equivalence decision on third-country sustainability reporting standards.
AMLR - (EU) 2024/1624
There are two level 2 measures listed as non-essential, including a DA on categories of corporate entities associated with higher risks and associated lower beneficial ownership thresholds.
EuGBS Regulation - (EU) 2023/2631
There are two level 2 measures listed as non-essential, including RTS on cooperation between competent authorities.
MID - 2009/103/EC
There are two level 2 measures listed as non-essential, for example, a DA on functions and obligations and procedures for reimbursement of the compensation bodies.
Benchmark Regulation - (EU) 2016/1011

There are two level 2 measures listed as non-essential, a DA on calculation method thresholds critical benchmarks and a DA on calculation method threshold significant benchmarks.

4. Insurance Updates: (1) Central Bank reduces Insurance Compensation Fund levy (2) EIOPA publishes strategic supervisory priorities for 2026

1. Central Bank Reduces Insurance Compensation Fund Levy

On 3 October 2025, the Central Bank of Ireland (“Central Bank”) announced the reduction of the Insurance Compensation Fund levy (“Levy”) from 2% to 1% as of 1 January 2026.

This is the first change to the Levy in 14 years and the Central Bank notes that the reduction will positively affect many customers with non-life insurance policies such as home and motor insurance (where the motor insurance provider is regulated by the Central Bank).

Responsibility

The Central Bank has stated that it is the responsibility of insurance firms to pay the correct levy and stressed the importance of being ready to implement the change in the Levy from 1 January 2026.

Expectations

The Central Bank expects firms to act in the best interests of consumers. As regards firms which explicitly pass the levy on to policyholders as a separate charge listed within their documentation, the Central Bank expects that the reduction is reflected in the policy from 1 January 2026 onwards.

This expectation is also applicable to current policies which are paid in instalments into 2026 and where the Levy charge is explicitly stated within the policy, the Levy should be updated to reflect the reduction from 1 January 2026.

No Further Credit Requests

The Central Bank also recommends no further request for credit for the Insurance Compensation Fund from the Minister for Finance is required. The 1% rate reflects an expectation that that rate will be sufficient to repay the outstanding loan balance and cover anticipated calls on the fund in 2026, taking into account companies which are already in administration or liquidation.

Welcoming the reduction in the Levy, Deputy Governor Mary-Elizabeth McMunn stated that:

“The Insurance Compensation Fund is an important fund, the purpose of which is to protect eligible policy holders in the event of their insurer going into liquidation. The changes announced today reflect the financial position of the fund and the reduction in the levy will positively impact a large cohort of policyholders in Ireland.

2. EIOPA Publishes Strategic Supervisory Priorities for 2026

On 1 October 2025, the European Insurance and Occupational Pensions Authority (“EIOPA”) published a document (“Document”) entitled “Union-Wide Strategic Supervisory Priorities – Focus areas for 2026.”

The following is a brief over of the Document.

Focus areas for 2026

EIOPA have stated that the focus areas for 2026 will be as follows:

DORA
The Document sets out that digital operational risks are expected to be an integral part of the supervisory review process of national competent authorities and will be included in their supervisory activities both onsite and offsite.
Some of the matters that will be particularly focused on, from a supervisory perspective, include:
- assessment as to whether the ICT risk management framework is fit for purpose given the business and ICT strategy of the undertakings;
- monitoring and proactive engagement with undertakings in relation to their major ICT related incidents;
- assessment of the ICT third-party risk management framework, including comprehensiveness of registers of information; and
- assessment of the digital resilience testing programme of the undertakings.
Sustainability risks
The Document explains that the assessment of sustainability risks shall be a priority and will focus on the prudential risk management and scenario analysis of sustainability risks and sustainability claims as well as the fair treatment of consumers in light of sustainability.
Some of the matters, that there will be a particular focus on, include the following:
- assessment of the quality and depth of materiality assessments of sustainability risks reported in own risk and solvency assessment reports, ensuring they are proportionate and specific to the undertaking’s risk profile as well as coherent with the undertaking’s strategy;
- assessment of the capacity of the risk management function to oversee sustainability risks, including the appropriateness of governance and key functions;
- assessment of the alignment between management of sustainability risks with investment decisions and approach towards prudent person principle; and
- assessment of sustainability claims made by (re)insurance undertakings in relation to their products and their overall sustainability profiles. The Document highlights that, in particular, the assessment should determine whether the claims are aligned with the four principles presented in EIOPA’s 2024 opinion on sustainability claims and greenwashing.

Areas for attention

The Document also sets out areas of attention for 2026, which is explained, is seen as necessary in order to cater for “some insurance specific developments”. The areas identified are as follows:

the solvency capital requirement (“SCR”) calculation for collective investment undertakings (“CIU”) (prudential). EIOPA considers that it is important that monitoring of the SCR calculation of this type of investment occurs given the nature of the risks stemming from investment in CIUs, and the increasing share of CIUs in the overall portfolio of (re)insurance undertakings and of insurance groups; and
the fair treatment of consumers in claims management, including through digitalisation (conduct). This is included as an area for attention due to issues, noted in the Document, with claims handling practices being a recurring theme in almost every annual consumer trends report.

Regular supervisory activities

The Document highlights that other regular supervisory activities, although not explicitly set out in the Document, will be carried out in parallel with the work on the areas of focus and the areas for attention.

5. ESAs 2026 Work Programmes Update: (1) ESMA Publishes its 2026 Annual Work Programme (2) EBA Publishes Work Programme for 2026 (3) EIOPA Publishes Annual Work Programme for 2026

1. ESMA Publishes its 2026 Annual Work Programme

On 3 October 2025, the European Securities and Markets Authority (“ESMA”) published its 2026 Annual Work Programme (“Programme”). The Programme is based on the implementation of ESMA’s multi – annual strategy for 2023 – 2028.

The Programme highlights that it builds on existing priorities while also taking into account upcoming “strategic shifts” as a result of the savings and investment union (“SIU”). In this regard, work will include aligning supervisory practices, enhancing market data capabilities and contributing to upcoming reforms as regards making EU capital markets more integrated, accessible and competitive.

Some of the areas of focus of the Programme include:

adapting to new economic, geopolitical, and technological developments, together with potential shifts in the global environment marked by volatility, uncertainty, and instability in international trade;
enhancing the competitiveness of EU financial markets;
simplifying rules to reduce reporting and administrative burdens. In this regard, ESMA has published a separate document on its approach to simplification and burden reduction (“SBR”) and intends to integrate the principles of SBR into the delivery of all upcoming policy mandates;
the Programme sets out ESMA’s expectation that it will contribute to a number of actions related to the range of actions set out in the European Commission’s SIU Strategy, for more information, see FIG Top 5 at 5 dated 27 March 2025;
the implementation of legislation agreed by the co-legislators under the previous legislature, including EMIR 3 / the development of the European single access point / the Retail Investment Strategy / the review of the securitisation regulation;
ongoing supervisory work, including, the authorisation and supervision of consolidated tape providers and ESG rating providers / extension of the supervision of third country benchmarks through the endorsement and recognition regimes under ESMA’s competence;
together with the other European Supervisory Authorities, ESMA will also be focused on exercising their joint oversight mandate under DORA;
ESMA will also focus on strengthening its approach as a data driven regulator and supervisor through developing the ESMA data platform, conducting studies on data centralisation, and exploring AI-powered tools for supervision, including anomaly detection and market abuse prevention; and
ensuring that the European financial sector is prepared for the transition to T+1 by under CSDR 11 October 2027.

2. EBA Publishes Work Programme for 2026

On 1 October 2025, the European Banking Authority (“EBA”) published its work programme (“Programme”) for 2026.

Priorities

The Programme sets out that the work of the EBA across 2026 will be driven by three priorities, as follows:

developing a rulebook which contributes to an efficient, resilient and sustainable single market, some of the areas highlighted under this priority include:
- contribution to the simplification and increased efficiency of the prudential regulatory framework;
- continuation of the work on the EU Banking Package;
- work related to the forthcoming revised Payment Services Directive (PSD3), Payment Services Regulation (PSR), and Financial Data Access Act (FIDA); and
- work related to the legislative process on the revision of the overall securitisation framework, including changes to the Securitisation Regulation and the Capital Requirements Regulation.
performing risk assessments with tools, data and methodologies which support effective analysis, supervision and oversight, some of the areas highlighted under this priority include:
- regular and ad hoc EU-wide risk assessments, including preparations for the 2027 EU-wide stress test;
- analysis of major ICT-related incidents and cyber threats;
- DORA joint oversight;
- supervision under the regulation on markets in crypto-assets; and
- integrated reporting.
tackling innovation to enhance the technological capacity of all stakeholders, some of the areas highlighted under this priority include:
- innovation monitoring and knowledge-sharing;
- a focus on artificial intelligence and machine learning;
- the EBA will also be focused on consumer protection, addressing matters such as, over-indebtedness, de-risking and education / cross-border supervision, retail risk indicators, and payment fraud / the implications of innovation.

Activities

Additionally, the Programme explains that the EBA will structure its work around seven overarching activities: policy development / supervisory convergence / risk and financial stability analysis / oversight and supervision / data / governance / operations.

Each activity is linked to the overarching priorities, with objectives, descriptions, and a list of main outputs.

Efficiency Report

The EBA also published a report (“Report”), dated 1 October 2005, on the efficiency of the regulatory and supervisory framework. The Report sets out the EBA’s proposals regarding a more efficient regulatory and supervisory framework in the EU.

The Report covers four key areas, as follows:

the production of level 2 and level 3 regulatory products addressed to financial institutions;
the reporting burden for these institutions;
the EBA’s contribution to the overall EU prudential regulatory framework; and
internal working arrangements.

The Report contains 21 recommendations and the Programme includes specific actions for each of the four areas. The EBA intends to regularly report on the implementation of the recommendations.

3. EIOPA Publishes Annual Work Programme for 2026

On 30 September 2025, the European Insurance and Occupational Pensions Authority (“EIOPA”) published its annual work programme (“Programme”) for 2026.

The Programme sets out EIOPA’s main priorities and activities for 2026.

EIOPA’s main priorities for 2026 are as follows:

Sustainable finance