Poland enacts EU banking directives on supervision, sanctions and ESG risk

Poland has enacted a sweeping amendment to its Banking Law that transposes two EU directives on banking supervision, sanctions, third-country branches and ESG risks. The Act of 31 July 2026 was published in the Dziennik Ustaw (Journal of Laws of the Republic of Poland) of 14 September 2026, item 1206, and was signed by President K. Nawrocki.

The act implements Directive (EU) 2024/1619 of 31 May 2024, which amends Directive 2013/36/EU on supervisory powers, sanctions, third-country branches and environmental, social and governance (ESG) risks, and Directive (EU) 2024/2994 of 27 November 2024 on the treatment of concentration risk from exposures to central counterparties (CCPs) and counterparty risk for centrally cleared derivatives. It also serves the application of Regulation (EU) 2024/1623 and Regulation (EU) 2024/2987, which revise the CRR capital framework and limit excessive exposures to third-country CCPs.

The law amends the Banking Law and several dozen other acts covering accounting, tax, insolvency, investment funds, capital-market supervision, payment services, mortgage credit, AML/CFT and the financial ombudsman, among others. Most provisions enter into force 14 days after publication, while a large block — including the new third-country branch regime — takes effect on 11 January 2027.

Third-country branches under a new licensing regime

The act replaces the concept of “branches of foreign banks” with a new category of “third-country branches” (oddziały z państw trzecich), subject to a permit from the Polish Financial Supervision Authority (KNF). Branches are assigned to one of two classes based on size and activity:

• Class 1: total assets of at least €5 billion, or retail deposits of at least 5% of total liabilities or exceeding €50 million;
• Class 2: all other branches.

Class 1 branches must hold capital equal to at least 2.5% of average liabilities (minimum €10 million), while class 2 branches must hold 0.5% (minimum €5 million). Both must maintain liquid assets covering at least 30 days of net outflows. The KNF may require a branch to convert into a domestic bank where a group’s EU assets reach €40 billion or its Polish assets reach €10 billion.

ESG risk and supervisory powers

Banks must now integrate ESG risk into their governance, risk management and business strategy, and adopt “ESG risk plans” with measurable targets covering short-, medium- and long-term horizons, including climate-neutrality goals. The KNF gains new powers to require banks to limit ESG risk and to run stress tests or scenario analyses on crypto-asset exposures. Management and supervisory board members must demonstrate knowledge of ESG risk, and banks must identify “key functions” and the persons holding them, subject to periodic fit-and-proper assessments.

Sanctions and fines

The act recalibrates the KNF’s sanctioning powers, aligning them with the EU framework:

• For legal persons: fines up to 10% of total annual net turnover, or twice the benefit obtained, or 5% of average daily net turnover per day of breach (up to 6 months);
• For individuals: fines up to 21,312,000 zł, or 213,165 zł per day of breach;
• Suspension of senior management for up to 12 months.

Central counterparty concentration risk

Implementing Directive (EU) 2024/2994, the act adjusts the treatment of concentration risk from exposures to central counterparties and of counterparty risk for centrally cleared derivatives. The KNF may require banks to limit exposures to a CCP or to offset exposures within clearing accounts, and the investment-funds law is updated to align the definition of CCPs with Regulation (EU) 648/2012.

For Polish banks and their customers, the reform tightens prudential oversight, raises the bar for governance and ESG risk management, and introduces a clearer, more demanding regime for foreign branches operating in Poland. The higher fines and new supervisory tools give the KNF stronger leverage to enforce compliance across the entire financial sector.

Source: Dziennik Ustaw, 14 September 2026, section I, item 1206 (official reference: Dz.U. 2026 poz. 1206).