The Macroprudential Oversight of Institutions Law of 2015 (Law 6(1) of 2015), gives the power to the Central Bank of Cyprus, as the designated macroprudential authority of Cyprus (‘the Macroprudential Authority’), the responsibility for defining and implementing a macroprudential strategy for safeguarding the stability of the financial system, including strengthening the resilience of the financial system and decreasing the build-up of systemic risks, thereby ensuring a sustainable contribution of the financial sector to economic growth.
In order to fulfill its macro prudential objectives, the Macroprudential Authority may ask investment firms to hold capital buffers, in addition to the Common Equity Tier 1 capital maintained to meet the own funds requirement imposed by Article 92 of Regulation (EU) No 575/2013 (the ‘Regulation’).
In order to achieve the objectives of its macroprudential policy, the Central Bank of Cyprus, as the authorized authority, took decisions to activate / modify the macroprudential tools as mentioned on its website.
Cyprus Securities and Exchange Commission (‘CySEC’) is responsible for monitoring the compliance of the CIFs with the above capital buffers.