On 15 January 2026, the European Central Bank (ECB) published a staff contribution to the European Commission’s targeted consultation on the application of the market risk prudential framework.

The ECB welcomes the Commission’s targeted consultation on the application of the market risk prudential framework and shares certain observations including:

• The implementation of the Fundamental Review of the Trading Book (FRTB) will have significant benefits in terms of added sensitivity and enhanced risk management.
• Further delaying the implementation of the FRTB would come with clear costs from a risk management and operational perspective.
• The maintenance and remediation of internal models currently used by banks has been deprioritised on account of the upcoming implementation of the FRTB.
• The proposal put forward in the consultation to have the FRTB enter into force in the EU on 1 January 2027 is welcome.
• Calculations based on the regulatory reporting of banks supervised by the ECB suggest that the impact of the full introduction of the FRTB would be concentrated in a subset of institutions, mostly global systemically important banks, for whom it would be significant relative to current market risk capital requirements, while being largely neutral for the majority of banks.