🎧 In conversation with Dana Wondra from Payment & Banking, Renate Prinz, Partner at Annerton, explains why the legislation goes far beyond reducing administrative burdens and why many institutions may still underestimate its practical implications. – Tune in now!
BRUBEG: More Than a Deregulation Act
The German Banking Directives Implementation and Bureaucracy Relief Act (BRUBEG) implements key elements of the European CRD VI framework. As such, it represents an important component of the final Basel III reforms within the European Union.
Greater Harmonisation Across Europe
One of the primary objectives of the European banking package is to create greater consistency in capital requirements and risk assessment models across the EU.
Historically, banks have relied on different internal models to evaluate risk. The new framework seeks to establish more uniform standards and improve comparability across the sector.
ESG Requirements Continue to Expand
Sustainability risks are becoming an increasingly important element of prudential supervision. Under the new rules, banks will be required to integrate ESG risks more comprehensively into their risk management frameworks.
However, many institutions continue to face significant challenges due to limited availability of reliable sustainability data, particularly within the SME sector.
Governance and Fit-and-Proper Requirements
The legislation also introduces broader governance obligations and enhanced fit-and-proper requirements.
Regulatory scrutiny will no longer focus solely on management board members but will increasingly extend to key function holders and governance structures throughout institutions. As a result, many banks will need to review and strengthen their internal frameworks.
Impact on Third-Country Institutions
International banks and third-country institutions are among those most affected by the new regime.
Many organisations will need to assess whether their existing business models remain permissible within the EU or whether additional licences, authorisations or organisational structures will become necessary.
Conclusion
Despite its name, BRUBEG is far more than a bureaucracy reduction initiative. It represents a significant regulatory reform package that affects governance, ESG compliance, risk management and cross-border banking activities.
Financial institutions should carefully assess the new requirements and begin implementation efforts at an early stage to ensure regulatory compliance.
About this podcast
Alles Legal – Fintech Recht Kompakt delivers sharp, weekly insights into legal and compliance matters in the world of banking. (in German only)
This podcast is a collaboration between Payment & Banking and PayTechLaw.
Each Wednesday, we unpack the legal developments shaping the financial world – clearly, concisely, and without the legal jargon.
Since 2021, PayTechLaw authors and Annerton attorneys have brought depth and clarity to complex topics.
Whether it’s PSD3, DORA, or FiDA – we provide the legal context you need.
In 20 minutes. No detours.
