This document evaluates how certain competent authorities implemented and supervised the Pillar 3 disclosure requirements between June 2023 and June 2025. It examines the integration of requirements into supervisory manuals and the effectiveness of supervisory processes for prudential disclosures. The findings indicate that most requirements have been largely incorporated, although some authorities faced challenges…
This report by the European Banking Authority (EBA), dated June 2026, is a peer review on the implementation and supervision of Pillar 3 disclosure requirements by competent authorities (CAs) in the European Union. The scope covers the period from June 1, 2023, to June 30, 2025, focusing on credit institutions (CIs) subject to Pillar 3 disclosure requirements under the CRR (Capital Requirements Regulation) and the BRRD (Bank Recovery and Resolution Directive), as well as the EBA's implementing technical standards (ITS). Six competent authorities are evaluated: ACPR (France), Banca d'Italia (Italy), KNF (Poland), Banco de Portugal (Portugal), Finansinspektionen (Sweden), and the ECB/SSM (Single Supervisory Mechanism). The report analyzes the integration of Pillar 3 requirements into supervisory frameworks, control processes, disclosure assessment, and institution compliance.
This report assesses the compliance and effectiveness of supervisory practices of competent authorities regarding Pillar 3 disclosure requirements, essential for market discipline and prudential transparency. The objective is to ensure convergence and consistent application of the CRR, BRRD, and EBA ITS rules. The study covers four key areas: (1) integration of Pillar 3 requirements into supervisory manuals and guidelines; (2) supervisory and review arrangements of disclosures, policies, internal processes, systems, and institution controls; (3) implementation of disclosure assessment processes; (4) supervision of institution compliance and corrective measures. Main findings show that most authorities have fully or largely integrated these requirements into their supervisory frameworks, notably ACPR, Banca d'Italia, and Banco de Portugal, which received a "fully applied" rating on most benchmarks. In contrast, Finansinspektionen (Sweden) was rated "not applied" on several criteria, justifying low engagement in Pillar 3 supervision, considering that the risk of non-compliance does not significantly affect financial stability. KNF (Poland) received mixed ratings, with ongoing efforts to improve tools and processes. The ECB adopted a selective, risk-priority-based approach, with partial disclosure reviews. The report recommends less advanced authorities strengthen their processes, notably by fully integrating requirements into their manuals, developing dedicated supervisory tools, ensuring rigorous documentation, and establishing effective follow-ups on non-compliance. A follow-up is planned in two years to assess the implementation of proposed measures.
The peer review aims to strengthen consistency and effectiveness of supervisory outcomes in the EU by assessing how competent authorities apply Pillar 3 disclosure requirements, which promote transparency and market discipline in the banking sector. The report addresses the need to evaluate credit institutions' compliance with CRR provisions (Part Eight) and BRRD (Article 45i), as well as the application of EBA implementing technical standards. The scope covers six competent authorities selected for their diversity in terms of supervised institution size and SSM/non-SSM status. The methodology relies on analysis of four key benchmarks related to regulatory integration, supervision, disclosure assessment, and compliance. The report focuses solely on prudential responsibilities of competent authorities, without evaluating other national actors. Limitations include the absence of assessment of non-prudential aspects and consideration of national specificities in ratings. The objective is to identify good practices, gaps, and propose appropriate corrective measures.
Integration of Pillar 3 requirements into supervisory frameworks:
- Most authorities (ACPR, Banca d'Italia, Banco de Portugal) have effectively integrated Pillar 3 requirements into their manuals, guidelines, and internal processes, with annual updates and dedicated training.
- KNF has partially integrated these requirements, differentiating between commercial and cooperative banks, with ongoing work to improve processes.
- Finansinspektionen has not defined specific processes, considering the risk of non-compliance insignificant.
- The ECB has integrated requirements into its internal guides, with a selective approach based on risk priorities.
Supervision and review of disclosures:
- ACPR, Banca d'Italia, and Banco de Portugal maintain updated lists of institutions subject to Pillar 3 requirements and robust processes to supervise compliance, including quality control tools and follow-ups in case of non-compliance.
- KNF is developing dedicated tools for commercial and cooperative banks, but processes remain partial.
- Finansinspektionen has no specific processes or updated list.
- The ECB performs regular but selective checks, with horizontal and vertical coordination.
Disclosure assessment within the SREP framework:
- Banca d'Italia has explicitly integrated Pillar 3 disclosure assessment into the SREP, with detailed documentation and cross-border coordination.
- ACPR has started annual reviews but without formal integration into the SREP.
- KNF considers internal governance assessment in the SREP, but without full disclosure review.
- Banco de Portugal conducts annual reviews integrated into the SREP, with an AI tool under development.
- Finansinspektionen does not integrate this assessment into the SREP.
- The ECB performs ad hoc assessments and quantitative reconciliations, without full report reviews.
Documentation and follow-up:
- ACPR, Banca d'Italia, and Banco de Portugal have well-documented processes, with checklists, registers, and evaluation reports.
- KNF has limited documentation, notably for cooperative banks.
- Finansinspektionen does not specifically document these processes.
- The ECB partially documents assessments, with planned improvements.
National specificities:
- Sweden imposes a legal audit obligation on capital-related information, influencing supervision.
- Poland distinguishes commercial and cooperative banks, with differentiated approaches.
- Other countries have no major specificities impacting Pillar 3 supervision.
Staff and resources:
- Resources dedicated to Pillar 3 supervision vary, with allocation based on a risk-based approach, notably at the ECB.
- Finansinspektionen does not allocate specific resources, while other CAs organize regular training.
Findings:
- The majority of competent authorities have integrated Pillar 3 requirements into their supervisory frameworks and have documented processes for disclosure review.
- ACPR, Banca d'Italia, and Banco de Portugal received a "fully applied" rating on most benchmarks.
- KNF has partially applied the requirements, with ongoing efforts to improve tools and processes.
- Finansinspektionen has not applied several criteria, justifying low engagement in Pillar 3 supervision.
- The ECB applies a selective approach, with targeted controls notably on climate risks.
Assumptions:
- Finansinspektionen's lack of intensive supervision is based on the assumption that the risk of Pillar 3 non-compliance does not significantly affect financial stability.
- The ECB assumes that prioritizing controls according to risks is sufficient to ensure compliance.
Interpretations:
- Pillar 3 supervision is generally well established, but the diversity of approaches reflects national priorities and differing resources.
- Integration into the SREP is more advanced in some countries, promoting more coherent supervision.
- Development of dedicated tools improves the quality and efficiency of controls.
Uncertainties:
- The long-term impact of non-systematic supervision in some countries on disclosure quality remains to be assessed.
- The effectiveness of corrective measures in case of non-compliance is not fully documented.
- Recent regulatory developments (e.g., ITS replacement) require continuous process updates.
The report concludes that Pillar 3 requirement supervision is well established in most competent authorities reviewed, with documented processes and effective practices, notably in France, Italy, and Portugal. However, significant gaps remain in some countries, particularly Sweden and partially Poland, where processes are insufficiently developed or applied. The report recommends:
- KNF to finalize the development of dedicated tools for Pillar 3 disclosure supervision, fully integrate these controls into the SREP, and formalize non-compliance follow-up processes.
- Finansinspektionen to define and document appropriate processes to integrate Pillar 3 requirements into its manuals and supervision plans, develop regular assessment tools, and implement systematic follow-ups.
- All competent authorities to maintain an updated list of institutions subject to Pillar 3 requirements, ensure supervision proportionate to institution size and risk, and guarantee complete documentation of assessments and measures taken.
- Continue convergence of supervisory practices and exchange identified good practices, such as SREP integration, regular training, and use of IT tools.
A follow-up peer review is planned in two years to assess the implementation of recommended measures.
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