What Belgium's "banking Oath" and Draft 2026 Banking Law Mean for Lenders, Practical Compliance & Litigation Steps

The banking oath Belgium regime is now live, and its second phase of obligations takes effect on 15 July 2026, compelling every credit institution, agent in banking and investment services, and fit-and-proper manager operating in Belgium to make a formal individual declaration of conduct. Simultaneously, the draft 2026 banking law introduces tighter governance, expanded director-suitability requirements and broadened administrative penalties, changes on which the European Central Bank has already issued Opinion CON/2026/2, flagging concerns around supervisory independence and conflict-of-interest prevention. For in-house counsel, compliance officers and risk directors at Belgian lenders, the combined effect is a materially higher standard of personal and institutional accountability.

This guide sets out the deadlines, the compliance steps and the litigation exposures that boards and credit teams need to address now.

Banking Oath Belgium: What It Is, Scope and Phased Deadlines

The banking oath is an individual, personal declaration by which a covered person commits to observing the rules of conduct that apply to the provision of banking and investment services in Belgium. It was established by the Law of 22 April 2019 (as coordinated), implemented through the Royal Decree of 28 January 2024, and operationalised by the FSMA Regulation approved on 16 June 2024. The FSMA, Belgium’s financial markets authority, oversees the oath’s administration, maintains the register and holds disciplinary enforcement powers.

The regime entered into force in two phases. Phase 1 took effect on 15 January 2025, covering senior managers, directors and other fit-and-proper persons at credit institutions. Phase 2, effective 15 July 2026, extends the obligation to additional categories including agents in banking and investment services and other persons involved in the provision of regulated financial services. Persons covered under Phase 2 must complete their oath by 15 January 2027 at the latest.

Industry observers expect the phased approach to create a window of heightened regulatory scrutiny, the FSMA is likely to prioritise verification of Phase 1 compliance while simultaneously onboarding Phase 2 registrants, meaning lenders that have not yet embedded the oath into their onboarding and annual compliance processes face immediate enforcement risk.

Who Must Take It, Categories and Territorial Scope

The FSMA’s published FAQ identifies the following categories of persons subject to the banking oath:

• Directors and effective managers of credit institutions established in Belgium, including members of the management committee and board of directors assessed under fit-and-proper standards.
• Responsible persons heading compliance, risk management and internal audit functions within credit institutions.
• Agents in banking and investment services, natural persons who, on behalf of a credit institution, engage in activities such as receiving deposits or providing investment advice.
• Other persons involved in the provision of regulated services, as specified by the Royal Decree of 28 January 2024.

Territorial scope is broad: the obligation applies to any natural person carrying out covered activities in Belgium, regardless of the nationality of the institution. Foreign credit institutions operating through a Belgian branch must therefore ensure that branch-level personnel who fall within a covered category also take the oath, in accordance with FSMA guidance and the coordinated Law of 22 April 2019.

Draft 2026 Banking Law Belgium, Key Lender Implications and ECB Opinion Highlights

Beyond the banking oath, the draft banking law Belgium introduces a series of structural governance and supervisory changes that will reshape lender compliance. The ECB’s Opinion CON/2026/2, published on EUR-Lex, provides the most authoritative external commentary on these proposals. Together, the draft law and the ECB’s recommendations signal a shift toward more granular, evidence-based governance requirements for Belgian lenders. The practical implications for credit teams, boards and compliance functions are significant.

The following are the key lender-facing implications of the Belgian banking law 2026 package:

1. Stricter director-suitability assessments. The draft law extends fit-and-proper evaluation criteria beyond existing CRD-aligned requirements, demanding more documentary evidence of competence, independence and absence of conflicts of interest.
2. Enhanced supervisory independence. The ECB opinion specifically flagged the need for clearer safeguards ensuring the national competent authority’s operational independence, early indications suggest this will translate into more assertive on-site inspections and data requests directed at lenders.
3. Conflict-of-interest prevention. New provisions require lenders to establish, document and periodically test conflict-of-interest policies at board and senior-management level.
4. Extended notification obligations for material holdings. Notification triggers for acquisitions and disposals of qualifying holdings are tightened, with shorter response windows for supervisory review.
5. Broader administrative penalty powers. The draft clarifies the FSMA’s and NBB’s ability to impose monetary penalties and periodic penalty payments for governance failings, not only for prudential breaches.
6. Merger and reorganisation scrutiny. Strategic transactions affecting a lender’s group structure now attract enhanced supervisory review, requiring prior notification and detailed impact assessments.
7. Reporting and transparency. Lenders must provide regulators with more frequent and granular reports on governance arrangements, including board composition, training records, and conflict-of-interest disclosures.
8. Alignment with ECB guidance on banking governance Belgium. The ECB opinion recommended that Belgium align its draft provisions with the ECB Guide to Fit and Proper Assessments, creating a de facto dual-standard for lenders subject to both Belgian and ECB oversight.

Comparison Table: Draft 2026 Changes vs. Current Position

NBB Macroprudential 2026 Context, What Lenders Must Also Consider

The governance and conduct reforms do not operate in isolation. The National Bank of Belgium’s Financial Stability Report 2024 highlighted systemic risks in the Belgian banking sector, including concentration in residential real-estate lending and increased sensitivity to interest-rate shifts. The NBB’s macroprudential decisions for 2026, including the setting of the countercyclical capital buffer, directly affect lenders’ capital planning, underwriting standards and provisioning models.

For lender compliance Belgium teams, the practical intersection is clear: the draft 2026 law’s governance requirements amplify the NBB’s macroprudential expectations. A lender that fails to integrate conduct-rule compliance (including the banking oath) into its broader risk-management framework risks not only FSMA disciplinary action but also adverse findings during NBB on-site inspections. The likely practical effect will be that credit committees must now factor governance-compliance status into lending decisions and portfolio reviews, treating it as a standing agenda item rather than a periodic audit point.

Key practical steps for credit policy and capital allocation include:

• Review capital adequacy. Ensure internal capital-adequacy assessments reflect the current countercyclical buffer level set by the NBB.
• Update provisioning models. Align IFRS 9 expected-credit-loss models with NBB reporting guidance and stress-test scenarios from the Financial Stability Report 2024.
• Integrate governance metrics. Add oath-compliance status and governance-reporting completeness as risk indicators in the lender’s internal risk dashboard.

Immediate Compliance Checklist for Lenders, Operational Steps for Banking Oath Belgium

Operational readiness requires coordinated action across multiple functions. The following 30/60/90 day plan is designed for lenders that have completed Phase 1 obligations and are now preparing for Phase 2 and the draft 2026 law’s anticipated entry into force.

Days 1–30: Foundation

• Board. Adopt a formal banking-oath compliance policy. Assign a named senior officer as oath-compliance coordinator. Place the banking oath and draft 2026 law on the next board agenda for formal discussion and minuted resolution.
• Legal. Complete a gap analysis of the current governance framework against the draft 2026 law’s requirements and ECB Opinion CON/2026/2. Identify contract templates requiring amendment.
• Compliance. Build and verify the internal oath register. Map all covered persons (Phase 1 and Phase 2 categories). Confirm Phase 1 persons have taken the oath and are recorded on the FSMA register.
• HR. Update onboarding procedures to include oath attestation for new hires falling within covered categories. Draft disciplinary-policy amendments addressing oath non-compliance.

Days 31–60: Implementation

• Training. Launch mandatory training for Phase 2 covered persons on the content and implications of the oath, the associated FSMA rules of conduct, and the disciplinary regime.
• Credit operations. Update credit-committee charters and lending-decision templates to include governance and conduct-compliance checks.
• Vendor and agent attestations. Issue attestation requests to all agents in banking and investment services, requiring confirmation of their oath status and compliance with rules of conduct.

Days 61–90: Verification and Reporting

• Internal audit. Schedule an internal audit of oath-compliance processes, including register accuracy, training completion rates and agent attestation coverage.
• Contracts. Complete the review and, where necessary, amendment of standard lending documentation, agency agreements and outsourcing contracts (see Section 6 below).
• Board reporting. Deliver first compliance report to the board, including register status, training metrics, identified gaps and remediation plan.

Sample Policy Clauses and HR Steps

The following templates are illustrative and should be adapted to each institution’s legal and operational context with the advice of qualified counsel.

• Onboarding attestation clause (new hires). “The Employee confirms that, prior to commencing covered activities, they have taken or will take the banking oath in accordance with the Law of 22 April 2019 and applicable Royal Decrees, and undertakes to comply with the rules of conduct prescribed by the FSMA Regulation of 16 June 2024. Failure to comply constitutes a material breach of this employment contract.”
• D&O indemnity amendment suggestion. “The Company shall review and, where necessary, extend the scope of its directors’ and officers’ liability insurance to cover claims arising from alleged breaches of the banking oath regime and associated rules of conduct, including FSMA disciplinary proceedings and related civil claims.”
• Agent attestation clause. “The Agent represents and warrants that all natural persons acting on behalf of the Agent in the provision of banking or investment services in Belgium have taken the banking oath within the deadlines prescribed by applicable law, and that the Agent maintains records evidencing the same. The Agent shall promptly notify the Principal of any failure to comply.”

Liability, Enforcement and Disciplinary Exposure, Bank Director Liability Belgium

The enforcement architecture supporting the banking oath and the draft 2026 law creates multiple channels of liability that lenders and their directors must understand and manage. The FSMA holds disciplinary and administrative sanction powers under the Royal Decree of 28 January 2024 and the FSMA Regulation of 16 June 2024. These powers extend to individual covered persons, not only to institutions.

The principal categories of exposure are:

• FSMA disciplinary sanctions. The FSMA may initiate disciplinary proceedings against any covered person who fails to take the oath or who breaches the associated rules of conduct. Sanctions may include warnings, temporary or permanent prohibitions from exercising covered functions, and public censure.
• Administrative fines. Under the draft 2026 law, monetary penalties and periodic penalty payments may be imposed for governance failings, including inadequate director-suitability controls and failure to maintain conflict-of-interest policies.
• Civil liability (culpa / fault-based). Under Belgian civil law, a director or officer whose breach of the banking oath or governance rules causes loss to a client or counterparty may face a civil claim for damages. The standard of fault (culpa) is assessed against the conduct expected of a reasonably diligent professional in the same position.
• Employment consequences. For employees in covered categories, failure to take the oath or breach of the associated rules of conduct may constitute grounds for dismissal for serious cause (dringende reden / motif grave), depending on the severity of the breach.
• Group and vicarious liability. An institution may itself face liability where it has failed to establish adequate internal controls, training or oversight to ensure compliance by its covered persons.

Practical risk-reduction measures include maintaining detailed delegation records, minuting all governance decisions, obtaining independent legal opinions on suitability assessments and preserving legal professional privilege over internal compliance reviews.

Litigation and Dispute Scenarios, Likely Claims and Defence Themes

Industry observers expect the following claim patterns to emerge as the banking oath and draft 2026 law bed in:

• Failed suitability checks. Probable claimant: regulator or shareholder. Cause of action: appointment of a director who did not meet fit-and-proper criteria. Defence: documented suitability assessment process, reliance on external advice, prompt remediation upon discovery.
• Improper advice causing client loss. Probable claimant: retail or professional client. Cause of action: breach of rules of conduct by an adviser who had taken the oath. Defence: evidence of training, supervision, written suitability reports, and compliance with internal policy.
• Mis-selling claims. Probable claimant: consumer or SME borrower. Cause of action: product sold by an agent whose oath status was not verified. Defence: agent attestation records, audit trail of vendor due diligence, contractual indemnity from agent.
• Breach of governance duties by directors. Probable claimant: institution (derivative action) or regulator. Cause of action: failure to implement conflict-of-interest policy as required by draft 2026 law. Defence: board minutes evidencing adoption and periodic review of policy, independent compliance testing.
• Regulatory enforcement action. Probable claimant: FSMA or NBB. Cause of action: systemic failure to maintain oath register or governance reporting. Defence: evidence of good-faith remediation, cooperation with regulator, root-cause analysis.
• Counterparty claims in lending transactions. Probable claimant: borrower or co-lender. Cause of action: lender failed to comply with change-of-law notification obligations in credit documentation. Defence: contractual limitation clauses, timely disclosure, proportionality of loss.

Early preparatory steps are critical: preserve all internal communications under legal privilege, secure witness statements from key decision-makers while events are fresh, and ensure that the institution’s litigation-hold protocol covers banking-oath and governance-related documents.

Contracting and Lending Documentation, Points to Update for Lender Compliance Belgium

The banking oath and draft 2026 law require lenders to review and, in many cases, amend their standard lending documentation, agency agreements and outsourcing contracts. The following clause areas should be prioritised:

• Representations and warranties. Add a representation that the borrower’s directors and key personnel comply with applicable banking-oath and governance requirements where the borrower is itself a regulated entity.
• Compliance covenants. Insert a covenant requiring the borrower to notify the lender promptly of any FSMA disciplinary proceedings, administrative penalties or governance-related regulatory findings.
• Change-of-law clauses. Update change-of-law and regulatory-event provisions to specifically reference the draft 2026 banking law and associated Royal Decrees, triggering renegotiation or early-repayment rights where material regulatory changes affect the borrower’s operational capacity.
• Indemnity and limitation of liability. Review indemnity clauses in agency and outsourcing agreements to ensure the lender is indemnified against losses arising from an agent’s or provider’s failure to comply with the banking oath or associated rules of conduct.
• Audit and inspection rights. Strengthen the lender’s contractual right to audit the counterparty’s oath register, training records and governance arrangements.
• Notification rights for regulatory events. Include a specific notification trigger for any regulatory event related to the banking oath, including FSMA investigations, formal warnings, or sanctions imposed on the counterparty or its covered persons.

Board and Banking Governance Belgium Playbook, What the Board Must Sign Off

The board of directors carries ultimate accountability for the institution’s compliance with the banking oath and the draft 2026 law. The following items should appear on the board agenda as formal approval points, supported by minuted resolutions:

• Adoption of the oath-compliance policy. Formal board resolution adopting the institution’s banking-oath compliance policy, designating the oath-compliance coordinator and approving the implementation timeline.
• D&O cover review. Resolution directing management to review and, if necessary, extend directors’ and officers’ liability insurance to cover banking-oath and governance-related claims, including FSMA disciplinary proceedings.
• Escalation matrix for suspected breaches. Approval of a documented escalation matrix setting out reporting lines and response protocols for suspected breaches of the oath or rules of conduct by any covered person.
• Regulatory reporting framework. Approval of the enhanced governance-reporting framework required under the draft 2026 law, including reporting frequency, content and responsible officers.
• Training plan. Approval of the institution-wide training plan covering the banking oath, associated rules of conduct, the draft 2026 law, and the institution’s internal governance policies.

Sample board resolution language: “The Board resolves to adopt the Banking Oath Compliance Policy dated [date], to designate [Name, Title] as the institution’s Oath-Compliance Coordinator with responsibility for maintaining the internal oath register and ensuring timely completion of all oath obligations, and to approve the implementation timeline set out in Annex [X] to this resolution.”

Conclusion, Six Priority Next Steps for Banking Oath Belgium Compliance

Belgian lenders face a converging set of governance, conduct and liability obligations that demand immediate, coordinated action. The banking oath Belgium regime is no longer prospective, Phase 1 is in force, Phase 2 takes effect on 15 July 2026, and the draft 2026 banking law will further tighten the regulatory environment. The six priority actions for every lender are:

1. Verify that all Phase 1 covered persons have taken the oath and are recorded on the FSMA register.
2. Map all Phase 2 covered persons and schedule oath completion before 15 January 2027.
3. Conduct a governance gap analysis against the draft 2026 law and ECB Opinion CON/2026/2.
4. Update onboarding, training, disciplinary policies and agent attestations.
5. Review and amend lending documentation, agency agreements and outsourcing contracts.
6. Convene a board meeting to adopt the oath-compliance policy, approve the D&O cover review and sign off the escalation matrix.

Sources

1. FSMA, Banker’s Oath FAQ
2. FSMA, Regulation of 16 June 2024 (Banker’s Oath)
3. Belgian Consolidated Law, Law of 22 April 2019 (Coordinated)
4. Royal Decree of 28 January 2024 (Banking Oath)
5. EUR-Lex, ECB Opinion CON/2026/2
6. National Bank of Belgium, Financial Stability Report 2024
7. NBB, Countercyclical Buffer / Macroprudential Decisions