CRD 6: Reinforced Supervision and Defined Requirements for Non-EU Bank Branches

On 19 June 2024, the EU's new banking package introducing the Basel 3 reforms was implemented with the publication of the final texts of the Capital Requirements Regulation 3 (CRR 3) and the Capital Requirements Delegation 6 (CRD 6).

-- CRD 6 came into force on 9 July 2024 with the aim of reinforcing the regulation of third-country branches of banks operating in the EU.

-- In our view, this will reinforce regulatory supervision over EU operations of third-country banks, substantially limiting their ability to provide cross-border core banking services.

-- The overall cost and operational impact of CRD 6 on existing TBCs should be manageable, although it could trigger non-EU institutions to reassess the way they operate in the EU.

"We view CRD 6 as reinforcing the regulation of third-country (non-EU) branches (TCBs) of banks operating in the EU", said Arnaud Journois, Senior Vice President - European Financial Institution Ratings. "We consider the publication of CRD 6 as an important step to better harmonise banking supervision at the European level".