Fast-tracking own funds reductions and SRT securitisations

13 May 2026

Authors: Armin Leistenschneider, Juan Blanc, Iannis Dahak and Vincent Woyames Dreher

Today’s regulatory environment calls for efficiency in supervision without compromising prudential standards. Streamlined processes can speed up decisions and benefit both authorities and banks, but they must not undermine soundness and financial stability.

In January 2026 the ECB introduced fast-track procedures for banks’ applications to reduce own funds and for significant risk transfer (SRT) securitisations. This enables the ECB to respond more quickly while maintaining supervisory rigour. Prudential standards remain unchanged with these measures.

As mentioned in a recent ECB opinion, oversight of synthetic securitisations is crucial, because risks may shift to non-bank entities and then return to banks during times of stress. These structures can lead to greater complexity and interconnectedness, making data quality and monitoring vital. Accurate information helps supervisors track risk and spot vulnerabilities.

Under EU banking rules, banks must seek the ECB’s approval before they buy back shares or other capital instruments, as these transactions reduce banks’ capacity to absorb losses. The rules also require originator banks to meet a set of conditions before their securitisations can be recognised as involving significant risk transfer, allowing them to benefit from lower capital requirements. The ECB must check that banks’ submissions comply with all applicable requirements before permitting such transactions.

At the beginning of 2026, the ECB launched a new external portal for bank applications for capital reductions, which was specifically developed to support the fast track. Ever since, the ECB received 56 complete applications to reduce own funds via the portal. This is similar to the number of own funds applications submitted via email in comparable periods of previous years, proving banks’ swift take-up of the new framework. Around 80% of the complete applications were assessed as low-risk and eligible for the fast-track procedure. Most of them were processed within less than one week on average. This is much quicker than before, when processes took several months, as applications were not submitted in a standardised format. The remaining 20% were assessed by the relevant supervisory teams outside the fast-track procedure.

The external application portal for banks, used to submit standardised data templates when applying for own funds reductions, is a crucial part of the procedure. Introducing these standardised templates meant that the process could be automated and accelerated, reducing the ECB’s response time for communicating the supervisory decisions to one week. At the same time, data standardisation has also significantly improved the processing of applications that were ineligible for fast-tracking.

During the first four months of 2026 SRT securitisation volumes remained modest, and only two transactions were submitted to the ECB via the fast track. The ECB completed its assessment of both transactions in just eight working days, whereas the previous process typically took several months. Looking ahead, the number of notifications is expected to rise in line with the higher volumes planned to be issued and as originators become more familiar with the new fast-track procedure for SRT securitisations.

The fast-track procedures for own funds reductions and SRT securitisations both follow a risk-based approach with strict eligibility criteria. Applications meeting the criteria benefit from a streamlined approval process, while the prudential standards remain the same as before. The fast tracks are based on a stable set of rules and focus on standardisation and consistency, thus increasing predictability and reliability. Banks can actively contribute to the simplification agenda by adopting transparent and straightforward structures, which facilitate standardised assessments and support efficient supervisory decision‑making. The fast-track procedures enable supervisors to swiftly process straightforward applications, freeing up valuable time and resources for deeper analyses, such as on the potential financial stability impact of the growing volumes of synthetic securitisation.

This targeted approach not only improves efficiency but also enhances the overall quality of oversight. Ultimately, it helps maintain high prudential standards while adapting to an evolving financial landscape. The procedures are a significant step in making processes more efficient. Their aim is both to transform how we manage the prudential assessment of transactions and to support good decision-making. By introducing these procedures to improve workflows and decision-making tools, the ECB has demonstrated its resolve to deliver concrete results that benefit stakeholders and align with its commitment on efficient, efficient, and risk-based supervision.

More details on the fast-track assessments can be found in the related press release and guide.