​The EBA launches early consultation on simplified EU-wide stress test, with climate risk integration

The European Banking Authority (EBA) published today the draft methodology, templates, and template guidance for the 2027 EU-wide stress test. The 2027 exercise introduces significant simplifications to improve efficiency and risk sensitivity, while preserving the robustness and comparability of results. Key changes include a substantial reduction in data requirements, the alignment of information with harmonised supervisory reporting, and the integration of climate risks into the EU-wide stress test. A total of 63 banks from the EU and Norway, including 47 from the euro area, will participate, covering 75% of the EU banking sector. The industry consultation is being launched at an earlier stage than for previous EBA stress tests, to facilitate banks’ preparedness. 

The consulted methodology cuts required data points by 55% compared with the previous EBA EU-wide stress test, mainly by drawing on regular supervisory reporting. This includes a simplification of stress test definitions and the elimination of previous stress test datapoints or templates which would overlap with supervisory reporting. This approach reduces duplication, lowers administrative burden, and improves data consistency, comparability and data quality for supervisors. 

Another major innovation is the introduction of climate risk into the EU-wide stress test. For the first time, transition and physical risks are incorporated in a structured and consistent manner alongside macro-financial shocks. At this stage, climate risks will be assessed through a dedicated module and will not affect the core stress test results, still marking an important step towards embedding climate considerations into prudential supervision.

The early publication of the draft package will enable stakeholders to better assess the combined impact of changes to the stress test methodology and the broader review of the Implementing Technical Standards (ITS) on supervisory reporting, which include a stress test reporting module. The early release reflects feedback received from the industry during consultations held in May 2026. The EBA also plans to hold a series of workshops with the industry to respond to their questions and accompanying them in their preparations.

Notes for editors

1. ​The simplification of the 2027 stress test templates and methodology is part of the forthcoming supervisory reporting changes announced on 10 April 2026.
2. Today’s publication marks the second major milestone under the EBA’s communication campaign “Simplifying to strengthen: building a more efficient EU prudential and supervisory framework”. This initiative is part of the EBA’s broader priority to simplify and enhance the efficiency of the regulatory and supervisory framework, in line with the work of its Task Force on Efficiency (TFE) and the EBA’s Report on the efficiency of the regulatory and supervisory framework, published on 1 October 2025. The proposed changes aim to reduce unnecessary operational burden while preserving a robust, consistent and risk-sensitive framework across the EU banking sector.
3. As in previous EU-wide EBA stress test exercises, the 2027 one provides a common analytical framework to assess the resilience of EU banks and the wider banking system under a common adverse macro-financial scenario, testing their capital adequacy under stress. The results will feed into the Supervisory Review and Evaluation Process (SREP). The EBA will continue to apply a primarily constrained bottom-up approach, complemented by supervisory top-down elements, including projections of net interest income and net fee and commission income.
4. The 2027 EU-wide stress test is coordinated by the EBA, in cooperation with the European Systemic Risk Board (ESRB), Competent Authorities, including the Single Supervisory Mechanism (SSM), and the European Central Bank (ECB). The EBA Board of Supervisors will finalise scenarios, methodology, quality assurance practices, templates, and template guidance, while the ESRB and ECB will develop the adverse macroeconomic and climate risk scenario.
5. Annex I of the methodological note contains a preliminary list of institutions included in the sample.