Extract from the CSSF Newsletter No 300 – January 2026
Why this matters
This regulatory update from the CSSF provides monthly statistics and main figures regarding the Luxembourg financial centre, which is relevant for banking, investment management, and wealth management firms operating in the jurisdiction.
Survey on the amount of covered deposits held on 31 December 2025
AI Analysis
Circular CSSF-CPDI 25/49 is a **mandatory quarterly reporting requirement** for Luxembourg credit institutions and postal financial service providers to submit data on covered deposits as of December 31, 2025. This survey directly feeds into the Single Resolution Fund's annual target level calculation and the Luxembourg deposit guarantee scheme's contribution assessments, making it essential for regulatory compliance and fund management.
Key dates
December 24, 2025
- Circular publication date
December 31, 2025
- Reference date for the survey
January 30, 2026 Deadline
- Deadline for transmitting average covered deposits data to the Single Resolution Board
Suggested considerations
*Calculate covered deposits as defined in Article 163 of the 2015 law, including balance and accrued interest (even if not yet due)
*Report eligible deposits after applying exclusions under Article 172 of the 2015 law, including exclusions for financial institutions and life insurance products
*Distinguish deposit types by reporting:
Total eligible deposits (field 201)
Eligible deposits in omnibus accounts, fiduciary accounts, trusts, sub-accounts, and segregated accounts (field 0226)
What changed
The circular explicitly states that no substantive changes have been made to the survey process compared to previous quarters. The only modifications are administrative: the reference date (December 31, 2025) and the submission deadline (January 30, 2026). The specifications for data collection, definitions of covered and eligible deposits, and reporting methodologies remain unchanged from prior circulars, particularly Circular CSSF-CPDI 16/02 as amended by Circular CSSF-CPDI 23/35.
Update of Circular CSSF 24/850 on the practical rules concerning the descriptive report and the self-assessment questionnaire to be submitted on an annual basis by support PFS, as well as the engagement of the réviseurs d’entreprises agréés (approved statutory auditors) of support PFS and practical rules concerning…
AI Analysis
Circular CSSF 25/903 updates Circular CSSF 24/850, refining practical rules for support Professional of the Financial Sector (support PFS) in Luxembourg regarding their annual descriptive report, self-assessment questionnaire, and the roles of approved statutory auditors (réviseurs d’entreprises agréés). It specifies requirements for auditors' engagement, management letters, and separate annual reports. This matters for support PFS as it enhances supervisory oversight, ensures consistent reporting quality, and strengthens internal controls, directly impacting compliance and audit processes amid CSSF's focus on robust PFS supervision.
Key dates
30 April (annually) Deadline
Submission Deadline; Support PFS must submit descriptive report, self-assessment questionnaire, management letter, and separate auditor report to CSSF by 30 April following the financial year-end (first applicable: 30 April 2026 for FY 2025)
31 December 2025 Deadline
Preparation Milestone; Auditors must be engaged and initial scoping completed by year-end 2025 for FY 2025 compliance
1 January 2026
Effective Date; Applies to annual reporting cycles starting for financial year 2025 onwards
Suggested considerations
*Review and Update Processes: Support PFS must map current reporting against new templates in CSSF 25/903 and revise internal procedures for descriptive reports and self-assessments.
*Engage/Confirm Auditors: Select or confirm approved statutory auditors compliant with new engagement rules; execute updated engagement letters incorporating circular requirements by Q4 2025.
*Implement Templates and Testing: Adopt CSSF-provided templates for reports, management letters, and separate reports; conduct sample-based testing of controls as specified.
*Training and Governance: Train compliance/audit teams on changes; ensure board approval of self-assessments and auditor findings.
*Submit on Time: Prepare and file all documents by 30 April deadlines, retaining evidence for CSSF inspections.
What changed
- Updates to Descriptive Report and Self-Assessment Questionnaire: Refines content, format, and submission requirements for support PFS's annual submissions, emphasizing more detailed disclosures on...
Auditor Engagement Rules: Introduces specific practical guidelines for approved statutory auditors, including mandatory scope of work, independence confirmations, and standardized procedures for...
Management Letter and Separate Report: Establishes detailed rules for auditors to issue an annual management letter (addressing findings, recommendations, and remediation) and a separate report for...
Enhanced Documentation and Evidence: Requires support PFS and auditors to provide verifiable evidence (e.g., checklists, testing samples) supporting self-assessments, with stricter CSSF validation...
Compliance impact
Urgency: High. This is high urgency for support PFS due to the impending 30 April 2026 deadline for FY 2025 submissions, with non-compliance risking supervisory fines, license reviews, or reputational damage under CSSF's PFS enforcement regime. It matters as it tightens audit accountability, potentially increasing costs (e.g., auditor fees) while reducing reporting errors—critical for smaller support entities with limited resources.
Repeal of Circular CSSF 19/731 regarding the documents to be submitted on an annual basis by credit institutions.
AI Analysis
Circular CSSF 25/902 repeals Circular CSSF 19/731 (as amended by Circular CSSF 19/710), which previously detailed annual document submission requirements for credit institutions, shifting to a dynamic list published on the CSSF website. This matters because it streamlines compliance by centralizing and updating requirements online, reducing reliance on static circulars while maintaining submission obligations. Credit institutions must transition to the new process to avoid disruptions in prudential reporting.
Key dates
12 December 2019
- Original issuance of repealed Circular CSSF 19/731 (archived on 23 December 2025)
23 December 2025
- Publication and effective date of Circular CSSF 25/902, repealing Circular CSSF 19/731; transition to website-based list begins
Suggested considerations
Review the CSSF Prudential reporting webpage (https://www.cssf.lu/en/prudential-reporting-credit-institutions/) and summary table (https://www.cssf.lu/en/Document/summary-of-documents-to-be-submitted-on-an-annual-basis/) to identify current document lists, categories, channels, and deadlines.
Update internal reporting processes, templates, and workflows to reference the website instead of the repealed circular.
Confirm ongoing annual submissions via specified electronic channels; test interactive table for applicability to the institution's profile.
Archive references to Circular CSSF 19/731 in policies and train staff on the change.
What changed
- Repeal of prior circulars: Circular CSSF 19/731 and its amendment via Circular CSSF 19/710 are fully repealed, eliminating the fixed list of annual submission documents.
Shift to website-based guidance: The updated list of required documents, affected entity categories, electronic submission channels, and deadlines is now published on the CSSF’s Prudential reporting...
Ongoing obligations: The requirement to submit documents annually remains unchanged; only the reference source and potential content updates via the website are modified.
Compliance impact
Urgency: Medium – The repeal does not alter core submission obligations but requires procedural updates to avoid non-compliance with potentially evolving lists under CRR3 alignments. It matters for operational efficiency, as failure to adapt could lead to missed deadlines or incorrect submissions, especially with website updates tied to EU regulations like Regulation (EU) 2024/1623 (CRR3, applicable from 1 January 2025). Institutions should prioritize review before the next annual cycle to ensure seamless reporting.
Practical rules concerning the descriptive report and the self-assessment questionnaire to be submitted on an annual basis by support PFS.Engagement of the réviseurs d’entreprises agréés (approved statutory auditors) of support PFS and practical rules concerning the management letter and the separate report to be…
AI Analysis
Circular CSSF 24/850, as amended by Circular CSSF 25/903, establishes practical rules for support Professional of the Financial Sector (support PFS) in Luxembourg to submit annual descriptive reports and self-assessment questionnaires, while also defining the roles of approved statutory auditors (réviseurs d’entreprises agréés) in issuing management letters and separate reports. This guidance standardizes supervisory reporting and audit processes to enhance oversight of support PFS, which provide essential back-office services to authorized PFS. It matters because non-compliance risks supervisory sanctions, reputational damage, and operational disruptions for entities reliant on support PFS structures.
Key dates
1 January 2025
- Effective date of original Circular CSSF 24/850
15 December 2025
- Effective date of amendments in Circular CSSF 25/903, applicable to 2025 reporting cycle onwards
31 March annually Deadline
- Deadline for submission of descriptive report, self-assessment questionnaire, management letter, and separate auditor report to CSSF (first applicable for FY 2024 reporting due 31 March 2025)
End of February annually Deadline
- Support PFS must engage auditors and provide necessary data to enable timely report preparation
Suggested considerations
Annual Reporting Cycle:
1. By year-end, conduct internal self-assessment using the prescribed questionnaire template (available via CSSF portal).
February to review submissions, test controls, and issue management letter (flagging deficiencies) plus separate compliance report.
Governance Updates: Review and update internal policies on risk assessment, auditor selection, and remediation of management letter findings; ensure board oversight of submissions.
Auditor Coordination: Verify auditor qualifications per CSSF register; implement any remediation plans from prior-year management letters before next cycle.
Record-Keeping: Maintain 5-year audit trail of all supporting documentation for CSSF inspections.
What changed
- Standardized Reporting Templates: Introduces detailed formats and content requirements for the annual descriptive report and self-assessment questionnaire, covering governance, risk management,...
Auditor Engagement Rules: Mandates approved statutory auditors to perform specific procedures, issue a management letter highlighting control weaknesses, and prepare a separate report confirming...
Amendments via CSSF 25/903: Updates clarify submission procedures, expand self-assessment criteria (e.g., adding cybersecurity and outsourcing risk questions), and refine auditor independence...
Frequency and Scope: Annual submissions required without exceptions; scope limited to support PFS (not primary PFS), emphasizing substance over form in service descriptions.
Compliance impact
Urgency: High – This is a recurring annual obligation with a firm 31 March deadline, where delays trigger automatic CSSF notifications and potential fines (up to €250,000 per Law 1993). It matters for support PFS as it intensifies scrutiny on operational resilience in a post-SFI (2021) landscape, where CSSF prioritizes substance in delegated functions; failure risks de-authorization or client outflows. Early implementation of templates and auditor pipelines is essential to avoid first-year pitfalls.
Press release 25/21(published on 22 December 2025, updated on 31 December 2025)
Why this matters
This regulatory update is about the dissolution and judicial liquidation of ALFA ASSET MANAGEMENT (EUROPE) S.A., an investment management and wealth management firm. It involves topics related to authorization and licensing as well as prudential and capital requirements.
This regulatory update relates to the profit and loss account of credit institutions, which is relevant for banking and investment management firms. The topics of prudential/capital requirements and reporting/disclosure are also applicable. The update is informational in nature, so the urgency is low.
relating to specialised investment funds, investment companies in risk capital and undertakings for collective investment subject to Part II of the Law of 17 December 2010
AI Analysis
Circular CSSF 25/901 consolidates and modernizes the supervisory framework for Luxembourg specialised investment funds (SIFs), investment companies in risk capital (SICARs), and undertakings for collective investment subject to Part II of the Law of 17 December 2010 (Part II UCIs), including their sub-funds. It streamlines investment rules, diversification limits, borrowing, disclosures, and risk management while enhancing flexibility for sophisticated investors and formalizing prior informal guidance, reducing regulatory complexity without compromising investor protection.
Suggested considerations
Review and update fund documents (e.g., sales documents, instruments of incorporation) to include mandated disclosures on investment strategy/limits, risks, UCIs/vehicles, borrowing, liquidity tools, and retail-specific warnings.
Assess and document compliance with new/relaxed diversification, borrowing, and SICAR investment rules; apply for CSSF derogations where justified.
Ensure risk-spreading in derivatives/collateral and deployment of SICAR cash into eligible assets; confirm look-through for intermediaries.
For retail-marketed funds: Limit investments/UCIs to 25%, cap borrowing at 70%, add prominent risk warnings for illiquids/long-duration.
Maintain robust governance/documentation to leverage flexibility; reference CSSF's Compilation for concepts.
What changed
- Diversification and investment limits: Introduces tailored percentage-based thresholds; for funds marketed to unsophisticated retail investors, limits remain at 25% per issuer/UCI/asset, raised to...
SICAR-specific rules: Confirms risk capital investments (e.g., equity, mezzanine) must align with development objectives, exceed mere market risk, and deploy incoming cash into eligible assets;...
Borrowing: For retail-exposed SIFs/Part II UCIs, investment borrowing capped at 70% of assets/commitments; no hard cap for sophisticated investor funds if disclosed, with SICARs limited to risk...
Derivatives and techniques: Permits use if economically appropriate (e.g., risk/cost reduction), with risk-spreading via diversified underlyings/collateral; counterparty risk limited if...
Urgency: High – Formalizes prior informal guidance into binding rules with enhanced flexibility but stricter retail protections and disclosure mandates, requiring immediate document reviews/updates for non-compliant SIFs/SICARs/Part II UCIs to avoid supervisory scrutiny or authorization issues; critical for funds targeting private markets or retail.
Revision and remodelling of the rules to which Luxembourg undertakings governed by the Law of 30 March 1988 on undertakings for collective investment (“UCI”) are subject
AI Analysis
Circular IML 91/75, as amended up to CSSF Circular 25/901, consolidates and modernizes the supervisory framework for Luxembourg Part II UCIs, SIFs, and SICARs, refining rules on diversification, borrowing, risk-spreading, and disclosures while tailoring requirements to investor profiles. It matters because it streamlines fragmented regulations, enhances fund competitiveness, and formalizes CSSF expectations without mandating immediate changes for pre-existing funds, reducing compliance burdens while promoting transparency and flexibility. This update aligns administrative practices with market realities, repealing outdated circulars to eliminate ambiguity.
Suggested considerations
Review and update offering documents/prospectuses for enhanced transparency on risks, limits, borrowing, liquidity tools (e.g., gates, notice periods), redemption processes, and investor-specific warnings.
Align fund documentation/terminology with CSSF Compilation of key concepts for consistency in filings and communications.
Disclose ramp-up/wind-down periods, potential derogations, and life extensions clearly; seek CSSF approval for exemptions where justified.
For SICARs: Ensure risk capital investments meet modernized criteria; apply look-through for limits.
Assess portfolio compliance for new funds/compartments; leverage flexibility for sophisticated investors but maintain robust governance.
What changed
- Consolidation and Repeals: Repeals CSSF Circulars 02/80, 07/309, 06/241, and Chapters G and I of IML 91/75; renders CSSF 08/356 and Chapter H of IML 91/75 inapplicable to Part II UCIs.
Flexible Diversification Rules: Introduces investor-category-based thresholds (e.g., stricter for retail, looser for sophisticated investors); allows CSSF derogations for SIFs/Part II UCIs with...
Borrowing Limits: New limits for SIFs/Part II UCIs (e.g., 70% of net assets, excluding temporary borrowings tied to commitments); tailored by investor type.
Enhanced Disclosures: Offering documents must detail investment policies, risks (especially private equity for retail), subscription/redemption processes, liquidity tools, gates, and amendment...
SICAR Risk Capital: Modernizes definition to include equity, loans, bonds, mezzanine; clarifies direct/indirect investments with three cumulative elements (risk of total loss, no redemption rights,...
Compliance impact
Urgency: Medium – Not critical as existing funds are grandfathered with no retroactive changes required, but high relevance for new launches or material updates post-19 Dec 2025. It matters for operational efficiency (streamlined rules reduce fragmentation) and investor protection (tailored risks/disclosures), potentially lowering long-term costs while mitigating supervisory scrutiny; failure to update docs could delay approvals or trigger CSSF queries.
Rules applicable to undertakings for collective investment when they employ certain techniques and instruments relating to transferable securities and money market instruments
AI Analysis
Circular CSSF 08/356, as amended by Circular CSSF 25/901, establishes detailed rules for Luxembourg undertakings for collective investment (UCIs), including UCITS and alternative investment funds (AIFs), on the use of techniques and instruments relating to transferable securities and money market instruments, such as securities lending, repo transactions, and over-the-counter (OTC) derivatives. It matters because it ensures investor protection, risk management, and market stability by imposing strict eligibility, collateral, and operational requirements, aligning Luxembourg funds with EU standards under UCITS and AIFMD directives. Compliance is critical for Luxembourg-domiciled funds engaging in these activities to avoid regulatory sanctions and operational disruptions.
Key dates
23 December 2008
- Original Circular CSSF 08/356 effective date for UCITS III implementation
21 July 2011
- Partial updates for UCITS IV alignment
22 July 2013
- Extension to AIFs under AIFMD transposition
15 October 2025
- Issuance of amending Circular CSSF 25/901
01 January 2026
- Effective date for amendments (e.g., new collateral rules, reporting formats)
Suggested considerations
*Policy Review & Update: Revise fund prospectuses, KIIDs, and risk management policies to reflect amended limits (e.g., counterparty caps, ESG collateral) within 3 months of 01 January 2026.
*Risk Management Systems: Implement or upgrade systems for daily collateral valuation, stress testing, and exposure monitoring; conduct gap analysis against Section 4 requirements.
*Counterparty Due Diligence: Reassess OTC counterparties for eligibility (e.g., EMIR clearing thresholds); negotiate ISDA/CSA agreements with updated haircuts.
*Operational Setup: Appoint triparty agents where required; ensure collateral segregation complies with Section 5.
*Reporting & Disclosure: Prepare for new quarterly CSSF filings (template in Annex 1); disclose revenues/reinvestments from techniques in annual reports (Article 14 UCITS Law).
What changed
The original Circular CSSF 08/356 (2008) transposed UCITS III requirements on eligible techniques like securities lending and repos.
Expanded collateral rules: Collateral must now include sustainable assets meeting SFDR criteria, with daily marking-to-market and haircuts adjusted for liquidity and credit risk (Section 3).
Counterparty exposure limits: Net exposure to a single OTC counterparty capped at 10% of net asset value (NAV), down from previous thresholds in some cases, with mandatory collateralization (Section...
Operational safeguards: Mandatory use of triparty agents for repos, enhanced segregation of collateral, and annual stress testing disclosures (Section 5, as amended).
Reporting enhancements: Quarterly reports to CSSF on transaction volumes, risks, and revenues from these activities (Annex 1, updated).
These align with ESMA guidelines (e.g., ESMA/2012/832 on OTC...
Compliance impact
Urgency: High - Immediate relevance for funds actively using these techniques (common in fixed-income and equity strategies for yield enhancement). Non-compliance risks CSSF fines (up to 5% of NAV), temporary prohibitions on techniques, or fund suspension. With the 01 January 2026 effective date recently passed (as of current context), firms face heightened scrutiny in 2026 reporting cycles; proactive remediation avoids enforcement actions amid CSSF's focus on operational resilience.
amending Circular CSSF 22/811.Authorisation and organisation of entities acting as UCI administrators.
AI Analysis
Circular CSSF 25/900, issued on 16 December 2025, amends Circular CSSF 22/811 to clarify governance principles, authorisation requirements, and operational standards for UCI (Undertakings for Collective Investment) administrators in Luxembourg, while reforming annual reporting obligations. It matters because it strengthens supervisory oversight, aligns with DORA for ICT outsourcing, and simplifies reporting to enhance efficiency and compliance in the fund administration sector.
Key dates
January 2025
- DORA entry into force, applying to ICT outsourcing for in-scope UCIAs
16 December 2025
- Issuance date; repeal of Annex B of Circular CSSF 22/811 effective immediately
31 December 2025
- New reporting framework (SAQ and updated modalities) applies to all financial years ending on or after this date
Suggested considerations
Assess eligibility and obtain prior CSSF authorisation via Annex A application (or notify substantial changes); ensure ongoing validity by monitoring operational model and delegations.
Adapt internal processes for revised annual UCIA reporting (SAQ-focused, integrated where applicable); submit using CSSF website instructions starting for FY ending 31 Dec 2025.
Review/update contracts with UCIs/IFMs to define roles, responsibilities, and oversight; implement delegation monitoring, remediation plans, and ICT compliance (DORA/Circular 25/882 or 20/750).
For DORA-scope entities, align outsourcing arrangements with Circular CSSF 25/882.
What changed
- Repeals Annex B of Circular CSSF 22/811 with immediate effect, replacing it with streamlined annual reporting via a core compliance-focused Self-Assessment Questionnaire (SAQ) that assesses...
Introduces prior CSSF authorisation requirements for entities acting as UCI administrators, including a defined administrative procedure with application details in Annex A; authorisation remains...
Clarifies scope for eligible entities (e.g., UCIs, IFMs, management companies under Luxembourg law) performing one or more of three UCI administration functions (defined in point 10); mandates...
Aligns ICT outsourcing with DORA (effective January 2025) for in-scope UCIAs (credit institutions, investment fund managers, investment firms, certain support professionals), referencing Circular...
Strengthens delegation rules (section 3.5): prior CSSF notification for critical/important tasks, ongoing monitoring by UCI/IFM, and remediation plans for shortcomings.
Compliance impact
Urgency: High - Immediate repeal of prior reporting Annex requires prompt process updates; new framework applies to FY 2025 year-ends (just past as of Jan 2026), risking supervisory scrutiny or penalties for non-compliance; DORA alignment adds operational resilience pressure amid ongoing CSSF focus on fund admin governance.
Authorisation and organisation of entities acting as UCI administrators
AI Analysis
Circular CSSF 22/811, as amended by Circular CSSF 25/900, establishes CSSF requirements for the authorisation, governance, internal organisation, and oversight of entities acting as UCI (Undertakings for Collective Investment) administrators in Luxembourg. It matters because it standardises practices amid regulatory, technological, and market evolutions, ensuring robust controls, risk management, and supervision for fund administration activities critical to Luxembourg's fund industry.
Suggested considerations
Submit authorisation application to CSSF with Annex A information before commencing UCI administration; notify substantial changes and keep file updated.
Establish/implement governance, controls, escalation processes, resource adequacy, ICT/business continuity per circular; ensure single provider per function.
For delegations: Conduct due diligence, execute written contracts detailing roles/obligations, notify CSSF in advance, retain oversight without delegating monitoring.
Conclude written contracts with UCI/IFM; submit annual UCIA activity reports.
UCIs/IFMs: Supervise coordinators, ensure information exchange/cooperation with administrators.
What changed
- Authorisation Requirements: Prior CSSF authorisation is mandatory for appointment as UCI administrator, via full application under sectoral laws or a simplified administrative procedure;...
Scope of UCI Administration: Defines three core functions—registrar, NAV calculation/accounting, and client communication—requiring only one designated service provider per function per UCI (or...
Governance and Controls: Mandates sound governance principles, control frameworks, escalation processes for errors/incidents, adequate resources (human, ICT), business continuity, and compliance with...
Delegation Rules: Delegation of tasks allowed but not of monitoring/oversight; requires written contracts, due diligence, and prior CSSF notification (3 months generally, 1 month for certain agents);...
Contracts and Reporting: Written contracts between UCI administrator and UCI/IFM; annual activity reporting due 5 months after financial year-end, starting from financial years ending post-30 June...
Compliance impact
Urgency: High – Non-compliance risks CSSF sanctions, as authorisation is prior and ongoing; critical for Luxembourg fund ecosystem given evolutions in tech/markets/DORA. Firms must act promptly if unauthorised or misaligned, especially with annual reporting since 2023 and DORA integration; impacts operational models, delegations, and reporting immediately for active administrators.
Application of the Guidelines of the European Banking Authority on Acquisition, Development, and Construction (ADC) exposures to residential property under Article 126a of Regulation (EU) 575/2013 (EBA/GL/2025/03)
AI Analysis
Circular CSSF 25/899 mandates the application of EBA Guidelines (EBA/GL/2025/03) on Acquisition, Development, and Construction (ADC) exposures to residential property under Article 126a of Regulation (EU) 575/2013 (CRR), specifying conditions for reducing the risk weight from 150% to 100% on qualifying exposures. This matters for Luxembourg credit institutions as it directly impacts capital requirements for real estate lending, promoting safer lending practices while aligning with Basel III standards via CRR3 implementation.
Key dates
4 November 2025
- EBA Guidelines (EBA/GL/2025/03) apply across EU (two months post-publication on 27 June 2025 in all official languages)
Review and classify ADC exposures against EBA-defined criteria (e.g., contract thresholds, equity levels, monitoring standards) to determine eligibility for 100% risk weight.
Update internal policies, risk assessment models, and credit approval processes to incorporate "sound lending standards" and EBA specifications, including social housing carve-outs.
Recalculate capital requirements under standardized credit risk approach; report changes via CRR disclosures.
Maintain documentation proving compliance (e.g., deposit proofs, equity valuations) for supervisory audits by CSSF.
Institutions must "make every effort to comply" per EBA Regulation Article 16(3).
What changed
- Introduces precise definitions for CRR Article 126a(2) terms, enabling 100% risk weight (instead of 150%) for ADC exposures to residential property if conditions are met: at least 50% of total...
Mandates "sound standards for lending and credit monitoring" alongside these criteria.
Accounts for social housing/public not-for-profit lending specificities, with tailored rules for regulated entities serving long-term tenant housing.
Replaces prior "particularly high-risk exposure" class with dedicated ADC class under CRR3.
Compliance impact
Urgency: High – Firms with significant ADC portfolios face immediate capital relief opportunities (50bp risk weight reduction) but risk non-compliance penalties if processes aren't updated by early 2026, especially post-CRR3 rollout; misclassification could inflate capital needs amid ongoing Basel implementation.
This regulatory update from the CSSF provides information on the global situation of undertakings for collective investment at the end of October 2025, which is relevant for investment management and wealth management firms.
This regulatory update discusses a supply-chain attack targeting NPM packages, which could impact firms across the financial services sector. It is relevant for banks, fintechs, and all firms that rely on third-party software and services.
Fonds de garantie des dépôts Luxembourg (FGDL) – Method for calculating the ex-ante contributions pursuant to Article 182 of the Law of 18 December 2015 on the failure of credit institutions and of certain investment firms
AI Analysis
Circular CSSF-CPDI 25/48, published on 13 November 2025, updates the methodology for calculating ex-ante contributions to the Fonds de garantie des dépôts Luxembourg (FGDL), Luxembourg's deposit guarantee scheme, by aligning risk adjustments with EBA Guidelines and introducing a zero floor for certain calculation components. This matters for Luxembourg credit institutions as it refines risk-sensitive contributions to meet DGSD target levels for two compartments (0.8% and an additional 0.8% of covered deposits), ensuring financial stability while promoting supervisory convergence across the EU.
Suggested considerations
Review and update internal systems/models for contribution calculations to incorporate new risk weights, bounds (Table 2), zero floor for Component 1, and revised formulas in Annexes 1-2.
Validate data reporting for risk indicators (e.g., ROA, LCR, NSFR, NPL) against adjusted sliding scales; ensure alignment with EBA Guidelines for simplicity and resource efficiency.
Prepare for FGDL invoices reflecting compartment-specific rates; monitor covered deposits for surveys (e.g., per Circular 25/49).
Conduct gap analysis against repealed circulars (20/21, 23/34); update policies for mergers, deposit changes, and gap fillings (Γ_λ).
What changed
- Risk Adjustment Updates (Annex 2): Increases weight of 'Return on assets' (ROA) risk indicator from 7.5% to 10%; decreases 'Deposit-size Risk' from 15% to 12.5%; adjusts sliding scale bounds for...
Formula Component Floor (Annex 1): Introduces a zero floor for Component 1 (max(0, A_{j,k})), preventing negative values from offsetting Component 2; retains both components but ensures no...
Contribution Calculation Refinements: Annual contributions per compartment use updated formulas (e.g., formula (1) with max operator); contribution rates are uniform per compartment but...
Repeals Prior Circulars: Repeals CSSF-CPDI 23/34 (4 June 2020) and CSSF-CPDI 20/21 (as amended), replacing the 2020-reviewed method.
Compliance impact
Urgency: High – Institutions must promptly recalibrate risk models ahead of 2026 contributions to avoid miscalculations, penalties, or underfunding risks, as this directly impacts prudential contributions amid ongoing DGSD buildup to 2026; non-alignment with EBA could trigger CSSF scrutiny. Failure to adapt may increase costs for riskier profiles, emphasizing the shift to greater risk sensitivity.
Fonds de garantie des dépôts Luxembourg (FGDL) – Method for calculating the ex-ante contributions pursuant to Article 182 of the Law of 18 December 2015 on the failure of credit institutions and of certain investment firms
AI Analysis
Circular CSSF-CPDI 25/48 updates the methodology for calculating ex-ante annual contributions to the Fonds de garantie des dépôts Luxembourg (FGDL), Luxembourg's deposit guarantee scheme, specifically for the target levels in Articles 179 and 180 of the Law of 18 December 2015 on the failure of credit institutions and certain investment firms. This matters because it introduces a risk-adjusted contribution model aligned with EBA Guidelines, shifting from purely deposit-based calculations to ones incorporating institution-specific risk factors, potentially increasing contributions for higher-risk banks while promoting stability in the scheme's funding.
Key dates
13 November 2025
- Circular publication date by CSSF
31 December 2025
- Reference date for covered deposits survey (per related Circular CSSF-CPDI 25/49)
2026
- First application year for new methodology (contributions for year j=2026 based on j-1=2025 data; invoices issued by FGDL)
Suggested considerations
Data Reporting: Submit accurate covered deposits data (e.g., as of 31 Dec 2025 per Circular 25/49) and risk indicator metrics (leverage, LCR, NSFR, NPL, etc.) to FGDL/CSSF for ARW calculation; prepare for annual surveys like CPDI 25/45 (31 Mar 2025 snapshot).
Internal Calculations: Model contributions using new formula C_{j,k} = ARW_{j,k} * max(0, max(A_{j,k}) + T_j D_{j-2,k}) * μ; forecast based on historical deposits (D_{j-2,k}) and growth.
Systems Update: Adapt finance/compliance systems for new inputs; align with EBA risk guidelines (https://www.eba.europa.eu/regulation-and-policy/single-rulebook/interactive-single-rulebook/1085).
What changed
- Modified Contribution Formula: Replaces prior methods (e.g., from Circulars CSSF-CPDI 16/01, 17/06, 20/21) with a new structure: Component 1 proportional to covered deposits growth (Γ_{j,k}) at...
Risk Adjustment Introduction: ARW is calculated using a weighted score (minimum 75% on EBA core categories, plus 12.5% deposit-size risk and 10% others) from indicators like leverage ratio (bounds...
Merger/Transfer Handling: For failed/merged institutions, contributions are redistributed proportionally to receiving institutions' deposit increases, capped by their own required amounts; no...
Floor and Alignment: Introduces max(0, A_{j,k}) floor to avoid negative components; ensures EBA compliance, simplicity, and risk sensitivity.
Compliance impact
Urgency: High - Affects 2026 contributions directly, requiring immediate data readiness and modeling by Q1 2026; non-compliance risks penalties, inaccurate payments, or higher costs from poor risk scores. Matters for capital planning as riskier profiles face uplifts, emphasizing proactive risk management amid EU harmonization.
Update of Circular CSSF 22/821 on the Long Form Report, as amended by Circulars CSSF 23/845 and CSSF 24/865
AI Analysis
Circular CSSF 25/897 updates Circular CSSF 22/821 on the Long Form Report (LFR) for credit institutions, further aligning the self-assessment questionnaire (SAQ) with current supervisory priorities such as ML/FT risks and organizational aspects. This matters because it refines reporting to reduce redundancies, enhance transparency in REA assessments, and reflect evolving prudential focuses since prior amendments via Circulars CSSF 23/845 and 24/865, ensuring institutions' reports better support CSSF oversight.
Key dates
31 October 2025
- Issuance date of Circular CSSF 25/897
Three months after financial year Deadline
end; - Annual submission deadline for SAQ to CSSF (unchanged from prior circulars)
Five months after financial year Deadline
end; - Submission deadline for REA Reports (Financial Instruments and Funds Report; AML/CFT Report)
Six months after financial year
end; - Aligned submission for REA management letter (per amendments in CSSF 23/845 to Circular 22/826)
Suggested considerations
Complete and submit revised SAQ annually, incorporating new modules on supervisory focuses like ML/FT risks and providing detailed data to REA.
Authorized management: Supply accurate descriptive information to REA for reports, covering client protections, collateral, and AML/CFT procedures across group entities.
REA: Independently assess and report on ML/FT risks and client assets with transparency, quantitative details, and verified management inputs; avoid imprecise language.
Review prior LFR submissions against this update to align with suppressed redundancies and new emphases.
What changed
- Introduces new modules in the revised SAQ to align with supervisory points of focus, building on prior expansions (e.g., credit/counterparty risk, liquidity risk, climate-related risks from CSSF...
Emphasizes REA's independent assessment in the AML/CFT report, requiring exhaustive, transparent evaluations of ML/FT risks across institutions, branches, majority-owned subsidiaries abroad, and tied...
REA must verify and amend descriptive elements provided by management for the Financial Instruments and Funds Report and AML/CFT report, including quantitative metrics like pending file ratios.
Confirms the three-part LFR framework: institution-completed SAQ, REA's client assets protection report (per Article 7 of Grand-ducal Regulation of 30 May 2018), and REA's AML/CFT report; no Agreed...
Enhances REA responsibilities for collateral arrangements and client fund protections under relevant laws.
Compliance impact
Urgency: High - Institutions face immediate refinement needs for 2025 year-end reporting (e.g., SAQ due ~Q1 2026), with stricter REA scrutiny on AML/CFT transparency risking supervisory findings or enforcement if vague assessments persist; aligns with ongoing CSSF push for risk-focused oversight amid regulatory evolution.
Long Form ReportPractical rules concerning the self-assessment questionnaire to be submitted by institutionsMission and related reports of the statutory auditors (réviseurs d’entreprises agréés)
AI Analysis
**Circular CSSF 22/821** (as amended) fundamentally restructures how Luxembourg credit institutions report to the Commission de Surveillance du Secteur Financier (CSSF) by replacing the traditional Long Form Report with a digital **self-assessment questionnaire (SAQ)**, complemented by auditor-prepared reports. This shift represents a significant operational change that requires institutions to directly participate in prudential self-assessment while maintaining robust external audit oversight, making it essential for compliance and operational teams to understand new submission requirements and digital workflows.
Key dates
25 October 2022
- Circular CSSF 22/821 issued
23 December 2022
- Initial publication date (updated 15 November 2023)
31 December 2022
- Circular enters into application
Three months before financial year closure
- SAQ becomes accessible through CSSF digital solution
Three months after financial year closure Deadline
- Deadline for SAQ submission to CSSF
Suggested considerations
*For Credit Institutions:
*Establish SAQ Governance: Designate authorized management responsible for reviewing and electronically signing the SAQ before submission; ensure accuracy and true-and-fair representation of information
*Data Preparation: Align SAQ responses with prudential reporting figures (FINREP/COREP/LAREX) under IFRS as of financial year closure
*Digital System Access: Obtain access credentials to the CSSF digital solution and familiarize compliance teams with the platform interface and submission workflow
*Module Completion: Complete all applicable SAQ modules as configured in the CSSF digital solution; note that module applicability and exemptions are institution-specific and recorded directly in the system
What changed
The circular introduces a three-component reporting framework that fundamentally alters the compliance landscape:
Self-Assessment Questionnaire (SAQ): A digital, annually-completed questionnaire that institutions must prepare directly, covering domains within CSSF and ECB prudential supervision competence
Agreed Upon Procedures (AUP) Reports: Reports prepared by approved statutory auditors (réviseurs d'entreprises agréés) on specific compliance areas
Separate REA Report on Financial Instruments Protection: A dedicated auditor assessment on safeguarding of client financial instruments
Scope of SAQ Coverage: The questionnaire addresses prudential...
Provisions relating to credit institutions and investment firms of EU origin established in Luxembourg by way of branches or exercising activities in Luxembourg by way of free provision of services
AI Analysis
Circular CSSF 07/325, as amended by Circulars CSSF 21/765, CSSF 22/827, and most recently CSSF 25/898, establishes supervisory requirements for EU credit institutions and investment firms operating in Luxembourg via branches or free provision of services (FOPS). It matters for compliance professionals as it defines CSSF's host authority role, notification obligations, reporting, and enforcement powers, ensuring alignment with CRD and MiFID II while adapting to evolving EU rules.
Key dates
One month before change effective date
- Notify CSSF and home authority in writing of programme changes (e.g., operations, services, additional places of business) per CRD Article 36(3) and MiFID II Article 35(10)
Within 3 months of receipt
- Home state authority communicates notification file to CSSF for branch/FOPS establishment
Six months after financial year
end; - Submit electronically signed SAQ (via eDesk), annual AML/CFT and conduct of business report (per Circular CSSF 19/731, to be repealed by CSSF 25/902), reviewed by REA
Suggested considerations
Notifications: Submit initial branch/FOPS notification to home authority (including operational programme); notify changes (e.g., services, locations) at least one month in advance to both home authority and CSSF.
Reporting: Complete and sign SAQ (accurate, concise, true/fair view) via eDesk within six months post-year-end; provide REA-appraised AML/CFT and conduct reports, detailing branch procedures/controls.
Supervision cooperation: Facilitate home/CSSF on-site inspections (with professional secrecy guarantees); ensure branch compliance with Luxembourg laws (e.g., LFS Article 46(2)).
Ongoing: Maintain branch infrastructure, update for legal changes, and align with CSSF user guides for eDesk authentication.
What changed
- CSSF 21/765: Updated provisions following amendments to CSSF Regulation No 12-02, refining notification and operational requirements for branches and FOPS.
CSSF 22/827: Further amendments to align with CRD and MiFID II changes, including enhanced notifications for programme alterations (e.g., one-month prior written notice for changes in operations,...
CSSF 25/898: Latest update (noted in CSSF Newsletter No 298, November 2025), incorporating recent legal/regulatory developments, such as refined reporting via eDesk portal, AML/CFT compliance...
Compliance impact
Urgency: Medium - Matters due to recurring annual reporting (e.g., SAQ, AML/CFT within six months post-year-end) and prior notifications for changes, with CSSF enforcement powers (e.g., measures under LFS Article 46(2)) for non-compliance. Recent CSSF 25/898 update (Nov 2025) requires immediate review of processes for digital submissions, but no retroactive changes or hard deadlines post-2025; grandfathering for pre-existing setups reduces immediate pressure.
Update of Circular CSSF 07/325 on Provisions relating to credit institutions and investment firms of EU origin established in Luxembourg by way of branches or exercising activities in Luxembourg by way of free provision of services, as amended by Circulars CSSF 21/765 and CSSF 22/827
AI Analysis
Circular CSSF 25/898 updates Luxembourg's supervisory framework for EU-origin credit institutions and investment firms operating in Luxembourg through branches or free provision of services. This amendment enhances the self-assessment questionnaire (SAQ) used by the CSSF to align supervisory oversight with current regulatory priorities, particularly adding UCI administration as a new thematic module. The update reflects the CSSF's evolving supervisory focus and requires affected institutions to demonstrate compliance with expanded assessment criteria.
Key dates
31 October 2025
- Circular CSSF 25/898 published by the CSSF
19 December 2025
- Related modernization framework (Circular CSSF 25/901) entered into force for Part II UCIs, SIFs, and SICARs
No specific implementation deadline stated Deadline
- Institutions should align their SAQ responses and compliance documentation with the updated framework immediately upon publication
Suggested considerations
*Update Self-Assessment Processes
Revise internal SAQ completion procedures to address the new UCI administration module
Ensure all thematic modules reflect current supervisory expectations
*Assess UCI Administration Compliance
If the institution provides or is involved in UCI administration services, conduct a detailed assessment of compliance with CSSF expectations
What changed
The circular introduces the following material modifications to Circular CSSF 07/325:
New Supervisory Module
UCI administration has been added as a thematic module to the self-assessment questionnaire, reflecting increased regulatory attention to fund administration practices.
Enhanced Self-Assessment...
Existing modules have been updated to better align with supervisory objectives and current regulatory priorities.
The revised SAQ now captures a broader range of supervisory points of focus relevant to branch operations and cross-border service provision.
Scope Clarification
The circular applies to credit institutions whose head office is in another EU Member State and to investment firms of EU origin established in Luxembourg by way of branches or exercising activities...
This press release provides an update on the global situation of undertakings for collective investment at the end of September 2025, which is relevant for investment management and wealth management firms.
Survey on the amount of covered deposits held on 30 September 2025
AI Analysis
Circular CSSF-CPDI 25/47 mandates a regular survey by Luxembourg credit institutions on the amount of covered deposits as of **30 September 2025**, focusing on eligible and covered deposits under the Law of 18 December 2015 on deposit guarantee schemes. It matters because it ensures accurate reporting to the Conseil de protection des déposants et des investisseurs (CPDI) for FGDL (Fonds de garantie des dépôts Luxembourg) compliance, with detailed field-by-field instructions for complex accounts like omnibus and trusts.
Key dates
30 September 2025
- Reference date for snapshot of deposits, eligible deposits, and covered deposits
6 October 2025
- Publication date of the circular by CSSF
Suggested considerations
Collect data on total deposits (field 0100), apply exclusions per Article 172 (field 0201), calculate covered deposits up to €100,000 limit (field 0300), and break down by natural/legal persons, balance thresholds, and special accounts (fields 0210-0330).
For omnibus/trust accounts, obtain and report shares of identifiable entitled persons, apportion by legal status of holder, and ensure fields like 0226 and 0255 reconcile.
Exclude non-creditor accounts or those assimilated to financial institutions/life insurance.
What changed
This circular updates prior guidance (notably CSSF-CPDI 16/02 as amended by CSSF-CPDI 23/35) by specifying the survey reference date of 30 September 2025 and providing granular reporting fields for eligible deposits (e.g., exclusions for financial institution-like structures and life insurance products), covered deposits capped at €100,000 per person, and breakdowns by natural/legal persons, including shares in omnibus accounts, fiduciaries, trusts, sub-accounts, and segregated accounts.
Compliance impact
Urgency: Medium – Past reference date (30 September 2025) as of January 2026 means non-reporting firms risk immediate FGDL non-compliance, fines, or supervisory action from CSSF, but this is a routine quarterly survey (see related Circular CSSF-CPDI 25/49 for December 2025). Matters for prudential reporting accuracy, especially amid EU deposit guarantee harmonization.
This press release from the CSSF provides an update on the global situation of undertakings for collective investment at the end of August 2025, which is relevant for investment management and wealth management firms.
This regulatory update relates to the profit and loss account of credit institutions, which is relevant for banking and investment management firms. The topics of prudential/capital requirements and reporting/disclosure are also applicable. The update is informational in nature, so the urgency is low.
Single Resolution Fund – Information request by the Single Resolution Board for the calculation of the 2026 contribution according to Articles 4 and 14 of Commission Delegated Regulation (EU) 2015/63
AI Analysis
Circular CSSF-CODERES 25/21, issued by the CSSF on 29 September 2025, mandates Luxembourg credit institutions to submit specific data via XBRL-formatted Data Reporting Forms (DRFs) to enable the Single Resolution Board (SRB) to calculate 2026 ex-ante contributions to the Single Resolution Fund (SRF) under Articles 4 and 14 of Commission Delegated Regulation (EU) 2015/63. This matters because non-compliance risks SRB using estimates, applying the highest risk multiplier, or penalties, ensuring the financial sector funds resolution costs without taxpayer burden.
Key dates
30 November 2025 Deadline
- SRB decision deadline on whether to calculate/collect 2026 SRF contributions based on DRFs (triggers full additional assurance application)
15 January 2026
- ECB-supervised institutions submit AUP or auditor reports on restatements to CSSF resolution department
16 January 2026, 24:00 CET
- All institutions submit completed DRF in XBRL to CSSF; late/incomplete submissions lead to SRB estimates or highest risk multiplier
Suggested considerations
Download and complete DRF using Annexes (e.g., Annex 3a PDF, Annex 5 User Guide v1.4); submit in XBRL format by deadline.
For ECB-supervised institutions: Provide additional assurances per Annex 7a/7b if SRB proceeds with collections; prepare restatement AUPs with auditor exceptions where applicable.
Align internal systems with CSSF templates early; validate data to avoid SRB assumptions under Article 17(1) DR.
- Introduces data collection for 2026 SRF contributions, conditional on SRB verifying SRF funds fall below 1% of covered deposits in the Banking Union by early 2026.
Mandates XBRL submission of DRFs (except restatements up to 2022 in Excel); provides templates in Annexes 3a, 4, 5 (User Guide), and 7a/7b for additional assurances.
Additional assurance requirements (e.g., auditor reports or Agreed-Upon Procedures - AUP) apply conditionally to ECB-supervised institutions unless under lump-sum payment; restatements require AUP by...
References SRB's 2026 kick-off letter (Annex 1) and ECB-supervised list (Annex 6 as of 24 September 2025).
Compliance impact
Urgency: High - The 16 January 2026 deadline is imminent (today is 25 January 2026), risking immediate SRB penalties like estimates or maximum risk multipliers if submissions are missed/inaccurate; affects capital planning as contributions directly impact prudential positions.
This press release from the CSSF provides an update on the global situation of undertakings for collective investment at the end of July 2025, which is relevant for investment management and wealth management firms.
Adoption of the EBA Guidelines on internal policies, procedures and controls to ensure the implementation of Union and national restrictive measures (sanctions)
AI Analysis
Circular CSSF 25/896 adopts the EBA Guidelines EBA/GL/2024/14 and EBA/GL/2024/15, mandating Luxembourg financial institutions to establish robust internal policies, procedures, and controls for complying with EU and national restrictive measures (sanctions). This matters because it sets binding EU-wide standards to prevent sanctions violations and circumvention, with absolute obligations for immediate asset freezing and reporting, amid escalating geopolitical tensions.
Suggested considerations
Conduct annual exposure assessments to sanctions risks and circumvention; update policies accordingly.
Appoint senior management/board-level responsibility for approving and overseeing sanctions strategy, including annual reviews and deficiency reporting.
Implement reliable screening systems for customers, transactions, and lists; define screenable datasets; test systems regularly for effectiveness (e.g., immediate freezing, accurate hits).
Provide documented training to relevant staff on sanctions, institutional exposure, and internal processes.
Establish processes for immediate action on matches: suspend transfers, freeze assets, report to Ministry of Finance/CSSF/FIU without delay; maintain whitelists only under strict conditions.
What changed
- Institutions must develop, implement, and maintain up-to-date policies, procedures, and controls for identifying, investigating, and applying restrictive measures without delay, including risk...
Management body responsibilities expanded: approve sanctions compliance strategy, oversee implementation, conduct at least annual assessments of exposure and controls, ensure remedial actions, and...
Screening and monitoring requirements: Maintain updated sanctions lists with immediate integration of changes; screen customer base, transactions, and datasets accurately; enable immediate...
Training and testing: Deliver regular, documented role-specific training; perform ongoing system testing for screening calibration, list accuracy, transaction monitoring effectiveness, and reporting.
Proportionality applies based on institution's size, activities, and exposure; PSPs and CASPs explicitly addressed with tailored controls.
Compliance impact
Urgency: High – With less than 12 months until the 30 December 2025 deadline (as of January 2026), firms face binding requirements for absolute compliance, including personal accountability for management bodies; non-compliance risks enforcement by CSSF, reputational damage, and fines amid frequent EU sanctions updates (e.g., Regulations 2025/1469, 2025/1476). This elevates sanctions from operational task to strategic board priority.
This press release from the CSSF appears to be related to regulatory oversight and authorization for BGL BNP Paribas, a bank operating in the banking, investment management, and wealth management sectors.
This regulatory update from the CSSF provides information on the global situation of undertakings for collective investment at the end of June 2025, which is relevant for investment management and wealth management firms.
CSSF notification regarding EMIR Article 7a(1) active account registration requirements. This is informational content about regulatory reporting and disclosure obligations for derivatives market participants.
This press release from the CSSF provides an update on the global situation of undertakings for collective investment at the end of May 2025, which is relevant for investment management and wealth management firms.
This regulatory update relates to the profit and loss account of credit institutions, which is relevant for banking and investment management firms. The topics of prudential/capital requirements and reporting/disclosure are also applicable. The update is informational in nature, so the urgency is low.
This press release from the CSSF provides an update on the global situation of undertakings for collective investment at the end of April 2025, which is relevant for investment management and wealth management firms.
This regulatory update from the CSSF in Luxembourg focuses on the use of artificial intelligence in the financial sector, which impacts banking, investment management, and wealth management firms.
This regulatory update provides information on the global situation of undertakings for collective investment at the end of March 2025, which is relevant for investment management and wealth management firms.
This regulatory update relates to the mandate and audit charter for the Internal Auditors Committee of the Eurosystem/ESCB and the Single Supervisory Mechanism. It is relevant for banks, asset managers, and wealth managers as it covers prudential requirements, operational resilience, and reporting obligations.
This press release from the CSSF provides an update on the global situation of undertakings for collective investment at the end of February 2025, which is relevant for investment management and wealth management firms.
This regulatory update relates to the profit and loss account of credit institutions, which is relevant for banking, investment management, and wealth management firms. The topics covered include prudential requirements, reporting, and licensing, which are important for these sectors.
This regulatory update warns about loan scams on social media, which is relevant for banking, consumer credit, and mortgage lending firms. It covers consumer protection and anti-money laundering topics, and is applicable to banks, fintechs, and all firms that engage in lending activities.
This regulatory update relates to the takeover of Iris Financial S.A. by Younited Financial S.A., which are firms operating in the banking, investment management, and wealth management sectors. The key topics covered include authorization and licensing, prudential/capital requirements, and consumer protection.