The EU delaying capital rules when it comes to trading activities of banks again and awaits clarity on US plans in order to regulate financial services is a scenario that’s cropping-up.
A European Commission spokesperson has confirmed that the regulation, which is also known as the Fundamental Review of the Trading Book, is going to be postponed by another year and will be starting again in 2027.
This is due to the fact that Block is awaiting clarity on how the US is planning to execute the Basel rules, as per the sources. It is well to be noted that the plan of Europe to execute the trading regulations in 2025 got derailed due to the fact that the US failed to agree on its own version when it came to the wider package of capital rules, which is called the Basel endgame in industry jargon.
When it comes to Washington’s appetite as far as introducing the entire package is concerned, it has been thrown into further doubt by the US president, Donald Trump’s administration, which has gone on to signal a wider regulation agenda.
It is worth noting that the EC has already gone on to push back the execution of the FRTB to 2026 and has avoided putting lenders like BNP Paribas and Deutsche Bank at a disadvantage vis-à-vis the US competitors.
The EC, apparently, went on to launch a consultation earlier in 2025 on choices, which include another one-year delay or further introduction of temporary tweaks when it comes to the measure that would make them less burdensome.
In another development, Maria Louis Albuquerque, the financial services commissioner, told a finance minister’s meeting that while there is a formal decision that has not been taken yet, the consultation responses have been overwhelmingly in favor of yet another delay of a year. Notably, the final decision has to be ratified by the college of commissioners.
With the plans of the US still not confirmed, countries such as France are putting pressure on the commission so as to go ahead and further delay the rules in order to get a level playing field with arrivals. They have already gone on to argue that EU delaying capital rules would free up capital and could as well be used to offer loans along with growth within their respective economies.