CySEC prudential supervision

New CIF Prudential Supervision Forms to CySEC – Forms 165-03 & 165-04

On the 22nd of June 2022, the Cyprus Securities and Exchange Commission (CySEC), published Circular C518, to introduce two new forms regarding the prudential supervision of Cyprus Investment Firms (CIF). Following the logic of the recently introduced prudential forms, Form 165-01 for Class 2 and Form 165-02 for Class 3 CIF regulated entities, the new reports consist of:

  • Prudential Form 165-03 ‘Prudential Supervision Information’
  • Prudential Form 165-04 ‘Application form for prudential permissions’

The Prudential Form 165-03 is tasked to update and replace existing Form 144-14-11, in facilitating CySEC’s desk-based supervision by collecting the necessary information for the assessment and evaluation of CIF regulated entities:

  1. Internal Capital Adequacy Assessment Process (ICAAP),
  2. Internal Liquidity Adequacy Assessment Process (ILAAP),
  3. Audited financial statements,
  4. Safeguards relating to client money.

In doing so, Form 165-03 considers the changes introduced by the new prudential framework for investment firms, IFR/IFD. Additionally, the said form stands as an annual reporting obligation for all Investment Firms and it must be submitted to CySEC via the Transaction Reporting System (TRS), by the 30th of June each year. As an exception for the year that ended on the 31st of December 2021, the form can be submitted by the 30th of July 2022.

Form 165-03 must be completed in the English language and reporting data should be completed in thousands in the reporting currency of each CIF. The naming convention of the file must be in the form ‘XX_Year_Form165-03’, where XX denotes the TRS identification code of each CIF and the Year the corresponding reporting year.

The Prudential Form 165-04 is required to be prepared from a CIF on an ad-hoc basis, according to the provisions of the IFR/IFD framework and Law 165(I)/2021, and it is introduced to ease Cyprus Investment Firms in requesting CySEC’s permission for the application concerning:

  1. Interim profit recognition
  2. Liquidity reduction

In this respect, a CIF which has to take any of the above actions must proceed with the completion of Form 165-04 and its submission through CySEC’s TRS. It is noted that the CIF shall complete only the sections relevant to the permission requested while the other sections shall remain empty.

The naming convention of the file must be in the form ‘XX_ddmmyy_Form165-04’, where XX denotes the TRS identification code of each CIF and ddmmyy corresponds to the submission date of the form.

For more regulatory obligations a CIF must meet in 2022 to comply with CySEC, please visit the SALVUS Regulatory Reporting Obligations Calendar.

The SALVUS Risk Management team is able to support you and prepare all forms related to Prudential Supervision including Form 165-01, Form 165-02, Form 165-03 and on an ad-hoc basis Form 165-04, along with the preparation of an ICAAP, ILAAP, and the relevant stress tests scenarios.

Please contact us at [email protected] or call us at +357 7000 7898 if you require additional information or support in fulfilling your prudential supervision reporting obligations.

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