Key takeaways
- The ECB’s new licence guide replaces its 2019 predecessor and consolidates rules for new banks, licence extensions and bridge banks into one document.
- Crypto-asset services and e-money tokens are now explicitly listed among the activities that can require a banking licence.
- Fintech applicants judged to carry higher risk must now submit an exit plan showing how they could wind down without harming consumers.
The European Central Bank published a new guide to licence applications on September 18, 2026, replacing the framework it had used since 2019. The document sets out, in one place, how the ECB and national supervisors across the euro area decide who is allowed to become a bank. The ECB describes its role in this process as that of a “gatekeeper” to the banking market.
The guide covers every route into eurozone banking: first-time licence applications, extensions of existing licences, banks created temporarily during a resolution, and mergers between credit institutions. It also formally folds in business lines that had little presence in the 2019 text, including crypto-asset services and electronic money issuance.
A Rulebook Built Around Consistency
Since November 4, 2014, the ECB has held exclusive authority to grant and withdraw licences for credit institutions established in countries participating in the Single Supervisory Mechanism, working jointly with national competent authorities. The new guide states that one of its primary objectives is to make “the legislative framework, the assessment criteria and the processes for establishing credit institutions more transparent and easier to understand,” and to ensure “greater consistency in the licensing of credit institutions across SSM jurisdictions.”
The guide explains why consistency became a priority. After European banking supervision began in 2014, it became clear there were differences among EU member states in how the licensing framework was interpreted and applied. The ECB and national authorities have since worked to narrow those gaps.
The document is explicitly non-binding. It states that it “does not lay down legally binding requirements” and “should not be construed as introducing new rules or requirements” beyond existing EU or national law. It is designed as a practical tool, and the ECB says it will review the guide regularly to reflect supervisory practice, regulatory developments, and new interpretations of the EU’s Capital Requirements Directive by the Court of Justice of the European Union.
The 12-Month Clock
Under Article 15 of the EU’s Capital Requirements Directive, supervisors must decide on a bank licence application within 12 months of receiving it, though national rules differ on when that clock starts and how suspensions for missing information affect it.
A Three-Phase Path to a Licence
Under the guide, licensing follows what the ECB calls a “common procedure.” The entry point for every application is the national supervisor of the country where the bank will be established, regardless of whether the bank meets the criteria for being classified as significant. That national authority and the ECB assess the application together, with the ECB taking the final, binding decision in most cases.
The process has three stages: a pre-application phase, in which supervisors and the applicant discuss the plan and flag early concerns; a formal application phase; and the decision itself. Article 15 of the Capital Requirements Directive caps the assessment at 12 months from receipt of the application, though the guide notes that member states have transposed this deadline differently — some start the clock the moment an application arrives, even if incomplete, while others wait until the file is considered complete. Requests for missing information can pause the countdown depending on national law.
The ECB describes pre-application discussions as good practice, saying they help identify concerns early and reduce the number of follow-up information requests. It also recommends that applications be filed through its SSM Portal, which it says improves transparency in communications with supervisors.
What Regulators Actually Weigh
The supervisory assessment covers five areas: the applicant’s programme of operations and business plan; its capital at authorisation; the fitness and propriety of its management body; the suitability of its shareholders; and anti-money-laundering considerations viewed from a prudential angle.
On capital, supervisors test whether an applicant would meet initial, risk-based and leverage-based requirements over its first 36 months of operation, under both a baseline scenario and a stress scenario the guide describes as “severe but plausible.” The portion of capital needed to cover the first 12 months must be paid up before the ECB grants authorisation.
On governance, the guide invokes a “four eyes principle”: authorisation is granted only where at least two people will effectively direct the business. The ECB assesses every prospective board member’s suitability at the licensing stage, though later board changes do not require a fresh licence decision. Shareholders with a qualifying holding are individually assessed for reputation, financial soundness and money-laundering risk; where no shareholder holds a qualifying stake, supervisors instead review the 20 largest shareholders.
On money laundering, the guide notes that enforcement of anti-money-laundering law is not among the powers transferred to the ECB under the SSM Regulation. Instead, the ECB assesses laundering and terrorist-financing risk only insofar as it could affect an applicant’s prudential soundness, cooperating with national authorities and, per a memorandum of understanding dated June 27, 2025, with the EU’s Authority for Anti-Money Laundering and Countering the Financing of Terrorism.
The ECB describes its own role in the process as that of a “gatekeeper” to the banking market.
Crypto, Fintech and the Boundaries of a Bank
The guide’s list of activities that can trigger a licensing requirement now explicitly includes issuing electronic money, including e-money tokens as defined under the EU’s Markets in Crypto-Assets Regulation, issuing asset-referenced tokens, and providing crypto-asset services under that same regulation. These categories were largely absent from the 2019 version, reflecting the crypto framework the EU adopted afterward.
For applicants whose business plan is seen as carrying elevated risk because of its business model — the guide cites fintech banks as an example — the ECB now also assesses an exit plan. That plan must show how the applicant could cease operations on its own initiative, in an orderly and solvent manner, without harming consumers, disrupting the financial system, or requiring regulatory intervention.
The guide also addresses investment firms that cross certain size and activity thresholds under the Capital Requirements Regulation, known as Class 1 investment firms. These firms must obtain authorisation as credit institutions, at which point they gain access to the EU’s banking passport system in place of the separate passporting regime that applies under the Markets in Financial Instruments Directive.
Part of a Wider Clean-Up of Supervisory Guidance
The new licensing guide is one piece of a broader review the ECB announced on June 26, 2026, covering roughly 130 supervisory publications — guides, reports, letters and methodologies. Around 40 of those documents have been discontinued as outdated, though they remain accessible online and are labelled as discontinued.
Other guides are still being revised on a rolling timetable: a governance and risk culture report is due in the first quarter of 2027, a risk data aggregation guide by the fourth quarter of 2026, and an on-site inspections guide by the end of 2026. The ECB has framed the overall effort as an attempt to “improve transparency, consistency and ease of use for banks and other stakeholders.”
Taken together, the licensing guide and the wider review point to supervisors trying to standardize how national systems across SSM jurisdictions apply a single set of EU banking rules — an effort the ECB itself traces back to inconsistencies that surfaced once European banking supervision began in 2014.
Photo: DXR · CC BY-SA 4.0 · via Wikimedia Commons
