In accordance with the provisions of article 3(1) of the Macroprudential Oversight of Institutions Law, 6(I) 2015, the CBC is the designated authority of Cyprus for the implementation of the provisions of article 458 of the Capital Requirements Regulation (CRR) of the EU in Cyprus.

Under article 458 of the CRR, the CBC is empowered to implement national macroprudential measures whenever changes in the intensity of macroprudential or systemic risk in the financial system are identified and which have the potential for serious negative consequences on the financial system and the real economy.

Article 458 of the CRR can only be used provided the national macroprudential authority justifies that other measures set out in the CRR of the EU and in the Capital Requirements Directive (CRD) of the EU are not sufficient to address this risk.

Such national macroprudential measures are intended to mitigate the changes in the intensity of risk and concern:

a) the level of own funds laid down in article 92 of the CRR

b) the requirements for large exposures laid down in article 392 and articles 395 to 403 of the CRR

c) the public disclosure requirements laid down in articles 431 to 455 of the CRR

d) the level of the capital conservation buffer laid down in article 129 of CRD

e) liquidity requirements laid down in Part Six of the CRR

f) risk weights for targeting asset bubbles in the residential and commercial property sector, or

g) intra-financial sector exposures.

In particular, when the national macroprudential authority identifies such changes in the intensity in one or more of the cases set out above, it submits a notification to the European Parliament, the Council of the EU, the European Commission, the European Systemic Risk Board and the European Banking Authority, providing information in relation to the proposed macroprudential measure it plans to take.

It is noted that the European Systemic Risk Board and the European Banking Authority provide opinions to the Council of the EU, the European Commission and the member state concerned within one month of receiving the notification. The European Commission may, within one month, propose to the Council of the EU an implementing act to reject the proposed national measure, if it considers that the measure will have a negative impact. In the absence of a European Commission’s proposal within the period of one month, the member state may proceed with the proposed national macroprudential measure.

It is also noted that prior to the adoption of any macroprudential measure by the CBC, the European Central Bank is consulted in accordance with the provisions of article 5 of the Single Supervisory Mechanism Regulation. In the case where the ECB objects, it shall state its reasons in writing within five working days.

The macroprudential measure taken by the CBC in accordance with the provisions of article 458 of the Capital Requirements Regulation of the EU, is set out in the Macroprudential policy decisions.

In accordance with the provisions of article 3(1) of the Macroprudential Oversight of Institutions Law, 6(I) 2015, the CBC is the designated authority of Cyprus for the implementation of the provisions of article 458 of the Capital Requirements Regulation (CRR) of the EU in Cyprus.

Under article 458 of the CRR, the CBC is empowered to implement national macroprudential measures whenever changes in the intensity of macroprudential or systemic risk in the financial system are identified and which have the potential for serious negative consequences on the financial system and the real economy.

Article 458 of the CRR can only be used provided the national macroprudential authority justifies that other measures set out in the CRR of the EU and in the Capital Requirements Directive (CRD) of the EU are not sufficient to address this risk.

Such national macroprudential measures are intended to mitigate the changes in the intensity of risk and concern:

a) the level of own funds laid down in article 92 of the CRR

b) the requirements for large exposures laid down in article 392 and articles 395 to 403 of the CRR

c) the public disclosure requirements laid down in articles 431 to 455 of the CRR

d) the level of the capital conservation buffer laid down in article 129 of CRD

e) liquidity requirements laid down in Part Six of the CRR

f) risk weights for targeting asset bubbles in the residential and commercial property sector, or

g) intra-financial sector exposures.

In particular, when the national macroprudential authority identifies such changes in the intensity in one or more of the cases set out above, it submits a notification to the European Parliament, the Council of the EU, the European Commission, the European Systemic Risk Board and the European Banking Authority, providing information in relation to the proposed macroprudential measure it plans to take.

It is noted that the European Systemic Risk Board and the European Banking Authority provide opinions to the Council of the EU, the European Commission and the member state concerned within one month of receiving the notification. The European Commission may, within one month, propose to the Council of the EU an implementing act to reject the proposed national measure, if it considers that the measure will have a negative impact. In the absence of a European Commission’s proposal within the period of one month, the member state may proceed with the proposed national macroprudential measure.

It is also noted that prior to the adoption of any macroprudential measure by the CBC, the European Central Bank is consulted in accordance with the provisions of article 5 of the Single Supervisory Mechanism Regulation. In the case where the ECB objects, it shall state its reasons in writing within five working days.

The macroprudential measure taken by the CBC in accordance with the provisions of article 458 of the Capital Requirements Regulation of the EU, is set out in the Macroprudential policy decisions.