ECB Consults on Guides to Bank Licensing and Fintech Bank Licensing
ECB launched a public consultation on two draft guides explaining the process of how entities can become banks and obtain a banking licenses. ECB also published the frequently asked questions (FAQ) on these guides. The consultation ends on November 02, 2017.
The first document, the draft guide to assessments of license applications, sets out the general process and the requirements for the assessment of such applications. The second document, the draft guide to assessments of fintech credit institution license applications, is directed at entities with a fintech business model, which are considering applying for a banking license. Both guides aim to make the application process more transparent and help applicants in their preparations. The guides are based on policies agreed between ECB and the national competent authorities for interactions with license applicants. Following the public consultation, ECB will publish the comments received, along with a feedback statement. A second consultation on an addendum to the draft guide to assessments of license applications will be conducted at a later stage.
Granting licenses for credit institutions is a core activity of every supervisory authority. The national competent authorities act as the first contact point for receiving licensing applications. However, the assessment of banking license applications is conducted jointly with ECB, which is the competent authority for making the final decision to grant, extend, or withdraw a banking license in the euro area. During the assessment process, supervisors evaluate whether an entity complies with the licensing requirements defined in EU and national law. Among other things, an entity must meet supervisory capital requirements, have an adequate governance and risk management system in place, and ensure that its management passes a fit and proper assessment.
Related Links
Guide on Fintech Bank Licensing (PDF)
Frequently Asked Questions (PDF)
Comment Due Date: November 02, 2017
Keywords: Europe, EU, Banking, Licensing Applications, Fintech, Guide, FAQ, ECB
Previous Article
Bundesbank Publishes AnaCredit Reporting Scheme Version 1.2Related Articles
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
BIS Bulletin Examines Cognitive Limits of Large Language Models
The use cases of generative AI in the banking sector are evolving fast, with many institutions adopting the technology to enhance customer service and operational efficiency.
ECB is Conducting First Cyber Risk Stress Test for Banks
As part of the increasing regulatory focus on operational resilience, cyber risk stress testing is also becoming a crucial aspect of ensuring bank resilience in the face of cyber threats.
EBA Continues Momentum Toward Strengthening Prudential Rules for Banks
A few years down the road from the last global financial crisis, regulators are still issuing rules and monitoring banks to ensure that they comply with the regulations.
EU and UK Agencies Issue Updates on Final Basel III Rules
The European Commission (EC) recently issued an update informing that the European Council and the Parliament have endorsed the Banking Package implementing the final elements of Basel III standards