In February 2020, the Cyprus Securities and Exchange Commission (CySEC) issued Circular C351 which introduces the Recovery Plan requirements for CIFs that fall within the scope of section 10(1) of the Investment Services Law.
The Recovery Plan aims to identify and prepare the actions which may be taken by a CIF to recover its financial position, following a range of scenarios of severe macroeconomic and financial stress that threatens its viability.
The specific reporting requirements are provided below:
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Simplified obligations |
Full obligations |
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Criteria |
CIFs that fulfil one of following: – Total Assets < EUR 1b or – Total Liabilities < EUR 1b or – Total Income < EUR 100m. (paragraph 4 of Directive DI20-01) |
CIFs that are not subject to simplified obligations |
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Prepare and Submit |
Solo Recovery Plan & |
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Reporting deadline |
30 September |
30 June |
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Frequency |
every two years |
every year |
CySEC issued on 29 May 2020 the final version of the Form-20-01 which represents the main contents of the recovery plan as per the provisions of Law 20(I)/2016. The majority of CIFs are subject to simplified obligations and as such are obliged to complete and submit Form 20-01. The purpose of the Form is to provide an overview of the recovery arrangements established by the CIFs. Furthermore, stress scenarios used in the Recovery Plan should be based on the ICAAP stress test scenarios in order to meet the “close-to-default” requirement of the recovery plan.
How can MAP RMS assist you?
MAP RMS can fully support your business’ regulatory reporting needs with respect to the Preparation and Submission of the Recovery Plan and Form 20-01 as per the Circular 351, Directive DI20-01 and EBA Guidelines. Specifically, our team of experts offers the following impeccable supporting services:
• Assistance with respect to the design of the government decision-making process in case of crisis (responsible officers, critical functions, core business lines, etc.);
• Determination of the Key Risk Indicators (KRI) as per the CIF’s risk profile and business operations;
• Identify normal, early warning and trigger points (red, amber and green level) for each KRI;
• Implementation of forward-looking Financial Projections;
• Implementation of stress scenarios which affect certain indicators;
• Assessment of the recovery option to be implemented in order to restore viability;
• Assistance with CySEC’s inquiries with respect to the preparation and submission of Recovery Plans.