ECB clarification on ICAAPs and ILAAPs and respective package submissions

What Changed

• - Introduced a two‑step ICAAP/ILAAP submission model under the SREP: (1) annual submission of the main “ICAAP & ILAAP package” by 15 March and (2) continuous, year‑round submission of any new or significantly updated ICAAP/ILAAP‑relevant documents, i
• Shortened the standard annual deadline for ICAAP/ILAAP information from 31 March to 15 March, reducing the preparation and governance window by roughly two weeks versus prior practice.
• Confirmed that the clarifications apply from the SREP 2025 cycle onwards, with a general transition approach for 2025 and limited transitional flexibilities for banks whose internal processes cannot yet meet the shorter deadline.
• Required inclusion of two distinct, concise documents within the annual packages: a “Capital Adequacy Statement” and a “Liquidity Adequacy Statement” reflecting the management body’s formal view on capital and liquidity adequacy, supported by ICAAP/I
• Clarified governance expectations around capital and liquidity planning, including regular updates of governance frameworks to reflect external conditions and the submission of a complete risk inventory covering both normative (regulatory/constraints
• Reaffirmed that forward‑looking capital and liquidity adequacy assessments must cover at least a three‑year horizon and include both baseline and adverse scenarios, incorporating economic downturn risks and aligning stress testing with identified key

Suggested Considerations

• Review existing ICAAP and ILAAP submission calendars and internal governance timelines and formally reset them to ensure core packages can be prepared, approved by the management body, and submitted by 15 March each year.
• Design and implement a documented two‑step submission process, including procedures for continuous, year‑round identification, approval and transmission to the ECB of any new or materially updated ICAAP/ILAAP‑relevant documents.
• Develop, approve and embed the new Capital Adequacy Statement and Liquidity Adequacy Statement, ensuring they reflect the management body’s signed‑off view on adequacy and are supported by clear references to ICAAP/ILAAP analyses and results.
• Update ICAAP and ILAAP governance frameworks to reflect ECB expectations, including explicit roles and responsibilities, escalation paths, periodic reviews triggered by external developments, and Board‑level oversight of capital and liquidity planning.
• Compile and maintain a comprehensive risk inventory covering both normative and economic perspectives, and ensure it is aligned with business models, risk appetite frameworks, recovery plans, stress testing programmes and SREP submissions.
• Re‑calibrate capital and liquidity management buffers and thresholds by systematically integrating stakeholder expectations, Pillar 2 Guidance, internal stress test outcomes, and uncertainty factors, and document the hierarchy between limits, early‑warning levels and internal targets.

Key Dates

Who is Affected