Regulatory Alerts2020-09-29
Added · Updated
ESMA Guidelines on Liquidity Stress Testing in UCITS and AIFs
The CSSF integrates ESMA Guidelines on Liquidity Stress Testing into its administrative practice, requiring investment fund managers to perform annual liquidity stress testing and document related policies within their risk management procedures. Depositaries must establish verification procedures to confirm that managers have documented liquidity stress testing programs in place, without replicating the tests themselves. Managers must notify the CSSF of material risks revealed by stress tests and include the adequacy of actions taken in their annual permanent risk management function reports. These requirements apply to UCITS, AIFs, ETFs, leveraged closed-ended AIFs, and certain Specialised Investment Funds, entering into force on 30 September 2020.
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