Draft EBA Guidelines for identifying ancillary services undertakings – how should institutions react?

On 7 July 2025, the European Banking Authority (EBA) published a consultation paper containing draft guidelines (the Draft Guidelines) specifying the criteria for identifying ancillary services undertakings (ASUs) under Article 4(1)(18) of Regulation (EU) No 575/2013 (CRR). The consultation marks a significant step following recent changes to the definitions of ‘ancillary services undertaking’ and ‘financial institution’ enacted by Regulation (EU) 2024/1623 (CRR 3).

This blogpost provides an overview of the Draft Guidelines and their implications for EU credit institutions and large investment firms.

I. What are ASUs and why are they relevant?

Pursuant to the CRR as amended by the CRR 3, ASUs are undertakings the principal activity of which, whether provided to undertakings inside the group or to clients outside the group, consists of any of the following:

(a) a direct extension of banking;

(b) operational leasing, the ownership or management of property, the provision of data processing services or any other activity insofar as those activities are ancillary to banking; or

(c) any other activity considered similar by the EBA to those referred to in points (a) and (b).

While these activities are not primary regulated activities, they can play an important role in the overall functioning and efficiency of institutions and financial institutions. As such, their qualification as an ASU is, according to the EBA, of paramount importance to ensure that, from a prudential perspective, the risks associated with their activities are integrated within the overall risk management framework and that sufficient capital is held to cover for the risks stemming from their operations.

Notably, ASUs are also included in the definition of ‘financial institutions’ under Article 4(1)(26) of the CRR and, as such, able to qualify as ‘financial sector entities’ under Article 4(1)(27) of the CRR and as financial holding companies under Article 4(1)(20) of the CRR, besides counting towards the indicators laid down in the definition thereof.

Against this background, with its Draft Guidelines, the EBA seeks to further clarify the above-mentioned criteria, to ensure consistent practices and to promote supervisory convergence in the qualification of ASUs across EU Member States.

(a) Which activities are a direct extension of banking?

According to the Draft Guidelines, the following activities should be considered as a direct extension of banking: 

• Activities that are fundamental to the value chain of core banking services (i.e. deposit-taking, lending and guarantee activities). This refers to the activities that are closely integrated into the value chain and would typically be carried out by an institution or financial institution as part of its day-to-day business. This includes, for example, the following activities when mainly provided to, or in the interest of, institutions or financial institutions: brokerage of commercial or residential loans or deposits, loan servicing activities, creditworthiness assessments, the valuation of collateral, debt recovery services, the management of risks stemming from core banking services, or the acquisition, ownership, management and liquidation of repossessed assets.
• Services and activities that involve maturity transformation, liquidity transformation, leverage or credit risk transfer when provided by undertakings that would qualify as shadow banking entities. These activities are regarded as an extension of banking because they encompass various forms of banking activities (e.g. taking funds from the public or lending over long periods). Importantly, EBA clarifies that collective investment undertakings shall not be considered as ASUs.
• Other activities related to lending, such as crowdfunding services, (digital-platform-based) peer-to-peer lending and marketplace lending.

(b) Which activities are ancillary to banking?

The second category of activities encompasses activities that are ancillary to banking. In this context, banking is defined broadly and includes almost all activities listed in Annex I of the CRD (e.g. deposit taking, lending, factoring, financial leasing, etc.) as well as all investment services and ancillary services under Directive 2014/65/EU (MiFID II). An activity should be identified as ancillary to these activities when it:

• supports banking (e.g. operational support, customer relationship support, risk management and regulatory compliance support, strategic and competitive support, or back-office and administrative support);
• complements banking (which includes the provision of specific distribution or marketing channels to allow an institution or financial institution of the group to expand its services and products to customers of the undertaking, or vice versa); or 
• significantly relies on banking, either on banking services and products (e.g. KYC, management of loan applications, or credit risk assessments) or on funding (committed to be) provided by an institution or financial institution.

Operational leasing, the ownership or management of property, as well as the provision of data processing services are listed in Article 4(1)(18)(b) of the CRR as examples of activities that are ancillary to banking. The Draft Guidelines further specify when these activities should be regarded as within scope.

Importantly, for these purposes, ‘operational leasing’ is defined as a leasing contract that does not substantially transfer to the lessee all the risks and rewards incidental to ownership of the leased asset. Operational leasing activities should be considered as ancillary to banking where the leasing of assets:

• is provided to institutions or financial institutions within or outside the group (e.g. leasing of buildings or premises); 
• is complemented by the offer and sale of banking products or services to the lessee through an institution or financial institution within the group (e.g. current account or payment services); or
• significantly relies on banking business. This includes situations where the undertaking significantly relies either on banking products or services (e.g. credit risk assessments as a basis for contract initiation and processing, collection of lease payments) or on funding provided by an institution or financial institution within the group.

Consequently, where operational leasing firms have no link to banking as described above (also considering the general criteria regarding supporting, complementing, or relying on banking), and provided that they do not engage in any further activities which would change the assessment, they fall outside the scope. 

Institutions that are active in the real estate sector should give particular attention to the ‘ownership or management of property’ condition. Ownership or management of property activities should be considered as ancillary to banking in the following situations:

• where they support banking, e.g. where the properties owned or managed by the undertaking are used as the head office or a branch of an institution or financial institution;
• where they complement banking, e.g. where the undertaking actively markets to its clients complementary banking products, such as mortgage loans; or 
• where they significantly rely on banking. This includes situations where the undertaking significantly relies either on banking products or services (e.g. project financial risk assessments, risk and compliance support, or other services which demonstrate a high level of interconnectedness and dependency) or on funding from institutions or financial institutions of the group for the purchase or development of properties.

Besides that, the Draft Guidelines outline the process for identifying activities that the EBA may consider similar to those referred to in (a) and (b) above, to ensure responsiveness to emerging sources of risk. 

What is a ‘principal activity’?

The EBA also sheds light on when an undertaking should be regarded as performing activities as ‘principal activity’, following a threshold-based approach not entirely unlike the one used for identifying a ‘financial holding company’. 

According to the Draft Guidelines, for this purpose, it is relevant whether the sum of the above-mentioned activities (direct extension of banking, activities ancillary to banking and similar activities) covers at least 50% of the undertaking’s assets, revenues, or personnel, based on its individual situation. However, even if none of these thresholds are met, a competent authority may establish, on a case-by-case basis, that relevant activities should be regarded as an undertaking’s principal activity.

II. Next steps

The consultation will run until 7 October 2025. Responses can be submitted here. Following the publication of the final guidelines in all official EU languages, competent authorities must confirm within two months whether they intend to comply with the guidelines (“comply or explain” mechanism).

Institutions should consider reviewing the activities of their subsidiaries and analysing the impact of the Draft Guidelines on their perimeter of prudential consolidation already before the guidelines start to apply, to allow for sufficient time for the assessment and any implementation work that may become necessary as a result.

We are closely tracking the development of the EBA guidelines and can assist with preparing feedback or interpreting the practical implications for your group’s structure and regulatory obligations. Please do not hesitate to reach out.