On 18 May 2026, the European Covered Bond Council released both its response to the European Banking Authority’s review of the EU Covered Bond Framework and a comparative analysis of major non-EU covered bond regimes against the EU Covered Bond Directive (CBD) and the EBA’s recommendations on a potential third-country equivalence regime.
The ECBC welcomed the EBA’s review, describing the current framework as effective in strengthening harmonisation, investor protection, market integration and financial stability, while cautioning against overly prescriptive reforms that could reduce flexibility, innovation and global competitiveness. The analysis also highlighted the importance of a well-calibrated third-country equivalence regime and the potential role of European Secured Notes in supporting SME financing and economic growth.
The comparative analysis covered Australia, Canada, New Zealand, Singapore, South Korea, Switzerland and the United Kingdom, assessing how closely these jurisdictions align with the CBD’s core principles, including dual recourse, segregation and bankruptcy remoteness of cover assets, coverage and liquidity requirements, public supervision and disclosure standards. The review also considered prudential treatment under Article 129 of the CRR, as well as liquidity and repo eligibility.
The ECBC’s work builds on the EBA’s September 2025 report, which broadly supported the introduction of a third-country equivalence regime for covered bonds, subject to conditions including robust regulatory standards, market maturity and reciprocity. The EBA also proposed a principle-based approach to equivalence assessments, allowing consideration of legislative frameworks, contractual features and market practices.
A key conclusion of the ECBC analysis was that there is already a strong level of convergence between the EU framework and most of the reviewed jurisdictions, although some markets may still require enhancements to aspects of their regulatory treatment.
Commenting on the review, ECBC Secretary General Luca Bertalot said covered bonds remain a core pillar of financial stability and an important source of long-term, cost-efficient funding for mortgage and public-sector lending.
Read the press release >