Coverage: July 2026 · Information to 1 July 2026
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TGB Monthly Regulatory Policy Brief · 1 July 2026
The EBA's final Pillar 3 package of 22 June 2026 cuts ESG data points for large banks by 37% and adds a shadow banking template, while the ECB keeps weak risk data aggregation among its supervisory priorities and other jurisdictions take lighter routes.
The desk view
The EBA's final draft Pillar 3 standards of 22 June 2026 complete the CRR3 disclosure build: ESG disclosure now reaches every institution, a new template captures aggregate exposure to shadow banking entities, and the expected first reference date is 31 December 2026, subject to European Commission adoption. The package simplifies as it widens, with large institutions disclosing 37% fewer ESG data points and taxonomy disclosures dropped. The ECB's emphasis is on the data behind the numbers: its 2025 SREP found no improvement in banks' average risk data aggregation sub-score, and it is revising its guide for publication in the fourth quarter of 2026. Elsewhere, the Basel climate framework is voluntary, the US agencies have withdrawn their climate principles and Asia-Pacific authorities are proceeding through supervisory guidance, stated priorities and corporate disclosure rules. We expect the binding constraint for EU banks to be data quality rather than template count.
The EBA completes the CRR3 disclosure build
On 22 June 2026 the European Banking Authority (EBA) published final draft implementing technical standards (ITS) amending the Pillar 3 disclosure framework on environmental, social and governance (ESG) risks and introducing disclosure requirements on equity and shadow banking exposures. The EBA said the package finalises the implementation of the disclosure requirements introduced by the Capital Requirements Regulation (CRR3) and was developed in line with the EU's simplification agenda and the Omnibus package. It is the second step of the EBA's roadmap: Commission Implementing Regulation (EU) 2024/3172 was step 1, and step 2 now covers equity exposures under Article 438(e), aggregate exposures to shadow banking entities under Article 449b and the extension of ESG disclosure to all institutions under Article 449a. The final report also repeals the EBA's guidelines on disclosure of non-performing and forborne exposures, because those disclosures now sit in the CRR through Articles 433b and 433c.
The package arrives well after the legal text took effect. CRR3's amendments to Article 449a, which extended ESG disclosure to all institutions, have applied since 1 January 2025. The EBA consulted on its proposals from 22 May to 22 August 2025 and received 45 responses, 36 of them published and nine treated confidentially. In the interval, a no-action letter of 6 August 2025 asked competent authorities not to prioritise enforcement of ESG templates EU 6 to EU 10 and of specific columns in Templates 1 and 4 for large listed institutions, in light of the Omnibus proposals. The gap between legal application and usable templates has therefore been bridged by supervisory forbearance rather than by early compliance.
The most visible change between consultation and final text concerns the EU Taxonomy. In May 2025 the EBA proposed full and permanent alignment with the Taxonomy Regulation in the scope and definition of the Green Asset Ratio (GAR) templates. The final draft ITS instead drop the GAR disclosures and any disclosures on the alignment of institutions' exposures with the Taxonomy Regulation. That reversal reflects the Omnibus I Directive, Directive (EU) 2026/470 of 24 February 2026, under which only corporates with 1,000 or more employees and net turnover above €450 million must report sustainability information, around 10,000 companies in the EU on the Commission's estimate.
Revised ESG Pillar 3 regime by institution type
| Institution type | ESG data points | Change | Expected first reference date, subject to European Commission adoption |
|---|---|---|---|
| Large listed institutions, current ITS | 2,614 | Baseline | Current requirement |
| Large institutions, final draft ITS | 1,648 | -37% vs current | 31 December 2026 |
| Other institutions and large subsidiaries | 1,368 | 17% less than large | 31 December 2026 |
| SNCIs and other non-listed institutions | 269 | 84% less than large | 31 December 2027 for SNCIs; 31 December 2026 for other non-listed |
Source: European Banking Authority, Final report on draft ITS on disclosures on ESG risks, equity exposures and shadow banking entities (EBA/ITS/2026/02), 22 June 2026; European Banking Authority, EBA updates Pillar 3 disclosure requirements on ESG risks, equity and shadow banking exposures, 22 June 2026.