AFME is pleased to present its views and recommendations on key priority areas in the sixth Capital Requirements Directive and the third Capital Requirements Regulation (CRD6/CRR3). The legislative proposal is expected to be published by the European Commission in mid-2021 and will come at an important juncture when policymakers are dealing with the fallout from the Covid-19 crisis and the need to ensure a strong and sustained economic recovery. This makes it even more important that the impact of CRR3 is correctly assessed and carefully calibrated, so that it is designed and implemented in a way that does not, unintentionally, constrain banks’ ability to support the economy.

At the same time CRR3 needs to be considered in the context of EU’s urgent priorities to complete the Banking Union, reduce fragmentation of financial markets and develop and deepen Europe’s capital markets through the establishment of a genuine Capital Markets Union.

In this publication, drafted in cooperation with ISDA, we present our recommendations for a CRR3 that is faithful to the overarching objectives contained in Basel III but which at the same time reflects the priorities outlined above.