Circular concerns central administration, internal governance and risk management.
Subjects to the circular are credit institutions, mortgage credit intermediaries, specialized professionals of the financial sector (PFS); cir available in English, French.
The cir specifies the measures credit institutions must take under the Law of Apr. 5, 1993 on the financial sector (LFS) regarding robust internal governance arrangements.
And under the Regulation CSSF No 15-02 on supervisory review, evaluation process.
Re the appointments of members of the management body and key function holders, the cir should be read in conjunction with the relevant Prudential Procedure online.
Cir has 4 parts on scope, central administration and internal governance requirements, specific risk management requirements, entry into force and history of the updates.
Specification of the definition of significant institutions and introduction of the term of transactions with related parties; clarification of scope re financial holding companies.
Alignment of certain circular provisions with applicable regulations, including the obligation to establish an audit committee, and real estate and mortgage exposures.
Also, the veto right of the head of the risk management function and their ability to challenge management decisions; outsourcing arrangements; legal references.
Future FAQs
LUX CSSF plans to publish a consolidated and amended version of all applicable FAQs.
