Regulation 2010/1093 - European Supervisory Authority (European Banking Authority) - Main contents

Summary of Legislation
Legislative text

1. Summary of Legislation

European Banking Authority (EBA)

SUMMARY OF:

Regulation (EU) No 1093/2010 establishing the European Banking Authority

WHAT IS THE AIM OF THE REGULATION?

It sets up the EU agency which works to ensure effective and consistent prudential regulation and supervision across the European banking sector. The agency's overall objectives are to maintain financial stability in the EU and to safeguard the integrity, efficiency and orderly functioning of the banking sector.

KEY POINTS

Consistent application of EU law

The European Banking Authority (EBA):

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draws up regulatory technical standards to specify the banking legislation to be adopted by the European Commission, where the Council and the European Parliament delegate this power to the Commission;
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has the power to issue guidelines and recommendations on the application of EU legislation.

Stress tests

The EBA has a prominent role in the EU-wide stress test exercise that examines banks’ resilience with regard to adverse market developments, and any systemic risks in the EU financial system.

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It initiates and coordinates stress tests in the EU with the national authorities responsible for supervising banks.
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In cooperation with the European Systemic Risk Board (ESRB), the European Central Bank (ECB) and the Commission, the EBA defines a common methodology for each edition of the stress test.
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It also monitors and assesses market and credit trends.

Breach of EU law

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The EBA has the power to investigate the alleged incorrect application by a national supervisor of EU banking and financial legislation (in particular when it fails to ensure that a bank complies with the requirements laid down in that legislation).
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The EBA may address a recommendation to the particular national supervisor. If the supervisor does not comply with this, the Commission can then be empowered to issue a formal opinion taking into account the EBA’s recommendation.
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If a national supervisor persists in not complying with the law, the EBA can adopt decisions directly addressed to the bank. This power can only be used in exceptional circumstances.

European financial supervision

The EBA is part of the European system of financial supervision created in 2010, which, in addition to the ESRB, comprises 2 other supervisory organisations:

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the supervisory authority in charge of the insurance and pension sector, based in Frankfurt (European Insurance and Occupational Pensions Authority — EIOPA);
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the supervisory authority in charge of the financial markets, based in Paris (European Securities and Markets Authority — ESMA).

Payment services

Directive (EU) 2015/2366 introduced revised rules for payment services in the EU. It strengthens the role of the EBA and requires it to issue guidelines and draft regulatory technical standards in various fields, for example to clarify the rules on ‘passporting’ for payment institutions operating in several EU countries, or to ensure the establishment of adequate security requirements.

Headquarters

Under Regulation (EU) 2018/1717, in the context of the United Kingdom’s intention to withdraw from the EU, the seat of the EBA was relocated from London to Paris as of 30 March 2019.

FROM WHEN DOES THE REGULATION APPLY?

It has applied since 1 January 2011.

BACKGROUND

For more information, see:

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European Banking Authority (European Banking Authority).

MAIN DOCUMENT

Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, pp. 12-47)

Successive amendments to Regulation (EU) No 1093/2010 have been incorporated into the original document. This consolidated version is of documentary value only.

Contents

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Summary of Legislation

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Legislative text