Circular CSSF-CPDI 25/48

What Changed

• - Modified Contribution Formula: Replaces prior methods (e.g., from Circulars CSSF-CPDI 16/01, 17/06, 20/21) with a new structure: Component 1 proportional to covered deposits growth (Γ_{j,k}) at 0.8% base rate, plus a flat add-on (T_j D_{j-2,k}) for
• Risk Adjustment Introduction: ARW is calculated using a weighted score (minimum 75% on EBA core categories, plus 12.5% deposit-size risk and 10% others) from indicators like leverage ratio (bounds 3-9%), capital coverage (100-200%), LCR/NSFR (100-200
• Merger/Transfer Handling: For failed/merged institutions, contributions are redistributed proportionally to receiving institutions' deposit increases, capped by their own required amounts; no positives added if the original can pay.
• Floor and Alignment: Introduces max(0, A_{j,k}) floor to avoid negative components; ensures EBA compliance, simplicity, and risk sensitivity.

Suggested Considerations

• Data Reporting: Submit accurate covered deposits data (e.g., as of 31 Dec 2025 per Circular 25/49) and risk indicator metrics (leverage, LCR, NSFR, NPL, etc.) to FGDL/CSSF for ARW calculation; prepare for annual surveys like CPDI 25/45 (31 Mar 2025 snapshot).
• Internal Calculations: Model contributions using new formula C_{j,k} = ARW_{j,k} * max(0, max(A_{j,k}) + T_j D_{j-2,k}) * μ; forecast based on historical deposits (D_{j-2,k}) and growth.
• Risk Monitoring: Track and improve key metrics (e.g., reduce NPLs below 3%, maintain LCR/NSFR >100%) to minimize ARW >1; review merger impacts.
• Payment: Pay FGDL invoices reflecting uniform rates per compartment, risk-adjusted amounts.
• Systems Update: Adapt finance/compliance systems for new inputs; align with EBA risk guidelines (https://www.eba.europa.eu/regulation-and-policy/single-rulebook/interactive-single-rulebook/1085).

Key Dates

Who is Affected