Circular CSSF 25/897
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.
- Ensure AML/CFT report details methodologies (e.g., sampling techniques) and covers branches/subsidiaries/tied agents.
- 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 23/845).
- 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 agents; prohibits vague language (e.g., no "no ser
- 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 Upon Procedures (AUP) reports remain, as eliminated
- 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.
Who is affected
Related regulations
References
AI-generated analysis. May contain errors or omissions — verify with the original CSSF source before acting. Full disclaimer.
What the CSSF said
Update of Circular CSSF 22/821 on the Long Form Report, as amended by Circulars CSSF 23/845 and CSSF 24/865
Published by CSSF . Read the full notice at the source for the authoritative text.