Circulaire CSSF-CODERES 23/18

Circular CSSF-CODERES 23/18 informs about the application of three guidelines of the EBA, notably the Resolvability Guidelines (EBA/GL/2022/01), Transferability Guidelines (EBA/GL/2022/11), and Resolvability Testing Guidelines (EBA/GL/2023/05).
The circular outlines the purpose of integrating these guidelines into the CSSF’s administrative practice and regulatory approach to promote convergence in the field of resolution at the European level. It emphasizes the importance of the resolvability assessment process in ensuring effective implementation of the resolution strategy and highlights the focus areas of the Resolvability Guidelines, including operational continuity in resolution, access to financial market infrastructures, funding and liquidity in resolution, bail-in execution, business reorganization, and communication.
Furthermore, the circular specifies the actions that institutions in scope should take to improve their resolvability, particularly when transfer tools are foreseen as the preferred or variant resolution strategy. It introduces the Resolvability Testing Guidelines, which include a self-assessment report by the institution against the EBA Resolvability Guidelines, the vdevelopment of a multi-annual testing program for resolvability by the CSSF, and the establishment of a master playbook for more complex resolution groups. The document emphasizes that the 3 Guidelines are to be implemented as a whole and therefore grouped together in the present single CSSF-CODERES circular, attached as an Annex and also linked with copies on the EBA website.
The circular applies to Luxembourg institutions whose resolution plan established by the CSSF involves the use of one or more resolution tools and who are not subject to simplified obligations for resolution planning. It delineates the level of application for institutions that are part of a group subject to consolidated supervision and those that are not, specifying that the Transferability Guidelines only apply to institutions where a transfer tool is part of the preferred resolution strategy.
The circular came into effect on 1 January 2024 and includes the aforementioned annexes containing the Resolvability Guidelines, Transferability Guidelines, Resolvability Testing Guidelines, and the format of the self-assessment report as per the Resolvability Testing Guidelines.