On 26 July 2021, the European Banking Authority (EBA) issued a public consultation on draft regulatory technical standards (RTS) setting out criteria for the identification of shadow banking entities for the purposes of reporting large exposures.

The legislative basis for the draft RTS is Article 394(4) of the Capital Requirements Regulation, as amended by Regulation (EU) 2019/876, which mandates the EBA to develop draft RTS to specify the criteria for the identification of shadow banking entities.

The draft RTS is a fairly short legal text with three main legal provisions addressing the following:

  • Criteria for identifying both shadow banking and non-shadow banking entities.
  • Definition of banking activities and services.
  • Criteria for excluding entities established in third countries from being deemed as shadow banking entities.

The deadline for comments on the consultation is 26 October 2021.

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