EBA: Public hearing on revised EU suitability rules

1. Overview

The Capital Requirements Directive 6 (CRD 6) will, amongst other important changes to the EU capital requirements framework, enhance and extend the existing framework for assessing the suitability of directors and senior managers in EU banks. The new rules strengthen regulatory expectations around governance and oversight and will apply to investment firms and third country branches. Against this backdrop, on 15 April 2026, the European Banking Authority (the EBA) held a public hearing as part of its consultation on the proposed revisions, which is due to finish on 25 May 2026.

The hearing covered the recently published consultation papers relating to:

• draft revised Joint ESMA and EBA Guidelines on the assessment of the suitability of members of the management body and key function holders (the Guidelines); and
• draft EBA Regulatory Technical Standards to specify the minimum content of the suitability questionnaire, curriculum vitae and internal suitability assessment (the RTS).

(together, the Consultation).

The public hearing provided industry participants with an opportunity to engage with the EBA on the scope, objectives and application of the proposed changes.

2. Purpose and scope of consultation

For key insights and a detailed examination of the key proposals arising from the Consultation, please see our recent article ESMA and the EBA consult on draft suitability Guidelines under CRD6.

3. Public hearing

As part of the public hearing, the EBA explained that the proposed revisions to the suitability assessment framework aim to:

• enhance supervisory convergence;
• reflect legislative updates introduced by CRD 6;
• align the suitability framework with related EU legislation; and
• maintain a proportionate, principle-based approach to suitability assessments (both at an individual and collective level).

5. Draft revised Joint ESMA and EBA Suitability Guidelines

The EBA confirmed that the revised Guidelines are intended to:

• reflect changes introduced by CRD 6, including amendments to Article 91 CRD 4;
• support harmonised supervisory practices across Member States; and
• apply on a risk based and proportionate basis.

The EBA emphasised that the Guidelines do not seek to amend Level 1 legislation but clarify supervisory expectations in relation to suitability assessments.

EBA Observations

During the public hearing, the EBA also made a number of observations following engagement with industry participants.

A. Suitability assessments and key roles

The EBA highlighted enhanced expectations in relation to suitability assessments, in particular for large institutions including increased competent authority involvement in the assessment of certain key roles and clearer expectations regarding suitability assessments for management body members and key function holders.

B. Risk and governance

The EBA clarified that explicit references to ICT and ESG risks in the Guidelines are illustrative rather than exhaustive and that management bodies are expected to maintain an understanding of all material risks arising from the institution’s activities. The EBA also confirmed that updated EBA Guidelines on internal governance will be published first (expected before December 2026), with the revised suitability Guidelines to follow thereafter.

C. Safeguards under Article 91(14) CRD 4

Participants raised questions regarding safeguards under Article 91(14) CRD 4 and whether an exemption was permitted in relation to internal suitability assessments in certain institutional structures (e.g. municipal savings banks). The EBA committed to reflect further on this point while emphasising that institutions must still assess, at least ex post, the knowledge and experience of management body members and address any gaps through tailored training.

D. Allocation of individual roles

Participants queried whether the requirement to allocate all material individual roles to specific management body members at para. 167 of the Guidelines risked blurring the distinction between collective responsibility and individual executive functions, and whether this may conflict with national governance models. The EBA indicated that the distinction between collective and individual responsibility will be clarified.

5. Draft EBA regulatory technical standards

During the public hearing, the EBA discussed the background to the RTS, and confirmed that the RTS are intended to support supervisory convergence by specifying the minimum content to be submitted to competent authorities for suitability assessments.

During the hearing, participants raised questions regarding:

• the application of the RTS to non-large entities, with the EBA confirming that supervisors may use the RTS as a benchmark subject to proportionality; and
• the interaction between internal suitability assessments and information submitted to competent authorities, with the EBA confirming that internal documentation relating to the assessment and specified in the RTS must be provided where requested.

6. Next steps

• Public consultation closes: 26 May 2026
• Final Guidelines and RTS targeted for publication: February 2027

7. Practical considerations for firms

The public hearing highlighted a number of practical issues for firms arising from the Consultation, particularly in relation to the operation of suitability assessments in practice. Firms may wish to consider whether their existing internal suitability assessments and supporting documentation would meet the minimum requirements set out in the draft RTS if requested by competent authorities. The EBA has confirmed that such internal documentation may need to be provided on request and kept up to date.

The discussion also underlined the importance of clearly documenting the allocation of individual roles within the management body, applying proportionality appropriately and ensuring that relevant safeguards are reflected in internal processes. More broadly, the proposals signal continued supervisory focus on collective suitability, governance and risk oversight. Firms may wish to consider engaging with the Consultation ahead of its closing date of 26 May 2026.

8. Simmons & Simmons: Supporting clients across Ireland and Europe

At Simmons & Simmons, our Irish and pan-European financial services regulatory teams advise clients on all aspects of governance and suitability, including management body composition, key function holder assessments, regulatory documentation and engagement with supervisors. We support firms in assessing the impact of evolving suitability requirements, enhancing internal frameworks and preparing for regulatory change in a proportionate and pragmatic manner.

For further insights or to discuss how Simmons & Simmons can support your firm, please contact our Dublin or European Financial Service Regulatory teams.