{"id":"circulars/cssf-20-737","title":"Circular CSSF 20/737","type":"circular","date":"2020-02-19","kind":"circular","html":"<p>Circular CSSF 20/737 is a CSSF circular, published 19 February 2020. Subject: Amendment of Circular CSSF 18/703 on the introduction of a semi-annual reporting of borrower-related residential real estate indicators.</p>\n<p>Relevant for: Credit institutions.</p>\n<p>Keywords: Real estate market, Single Supervisory Mechanism (SSM).</p>\n<p>Amends <a href=\"/lhoft?page=circulars%2Fcssf-18-703\" class=\"wikiLink\" data-target=\"circulars/cssf-18-703\">Circular CSSF 18/703</a>.</p>\n<h2>Text</h2>\n<p>Luxembourg, 19 February 2020</p>\n<p>To all lenders in residential real estate</p>\n<p>Re: Amendment of Circular CSSF 18/703 on the introduction of a semi-annual reporting of borrower related residential real estate indicators</p>\n<p>Ladies and Gentlemen, The objective of this circular is to modify Circular CSSF 18/703 and to inform on an update the data collection template. Circular CSSF 18/703 introduced a semi-annual reporting of borrower related residential real estate indicators as well as definitions of these indicators and a template used for the collection of these indicators. Circular CSSF 20/737 introduces a change in the template for the data collection. Specifically, the new data collection template is not an annex to Circular CSSF 18/703 anymore but can be found at the CSSF website. In case of further changes in the data collection template in the future which do not have an impact on the definitions of Circular CSSF 18/703, the template available on the CSSF website will be added and reporting institutions will be duly informed of the new template. To facilitate reading, changes are presented in Annex under a ‘track changes’ format.</p>\n<p>Yours faithfully,</p>\n<p>Annex</p>\n<p>Luxembourg, 17 December 2018 To all lenders in residential real estate</p>\n<p>Re: Introduction of a semi-annual reporting of borrower related residential real estate indicators</p>\n<p>Ladies and Gentlemen, The objective of this circular is to introduce a macroprudential risk monitoring framework for the residential real estate sector in Luxembourg which is based on a recommendation by the European Systemic Risk Board (ESRB/2016/14 Recommendation of the European Systemic Risk Board of 31 October 2016 on closing real estate data gaps – hereinafter “the ESRB recommendation”). The reporting aims at collecting indicators on lending standards in the residential real estate (RRE) market 1. The circular introduces definitions of these indicators as well asthat are collected via thea dedicated template used for the collection of these indicatorsavailable on the CSSF website.</p>\n<p>Please note that the recommendation ESRB 2016/14 also covers data gaps regarding commercial real estate (CRE) lending. CRE data is not covered by this circular.</p>\n<ol>\n<li>Scope The scope of the data collection refers to loans taken for the purpose of purchasing residential real estate in Luxembourg, and that are secured by real estate collateral located in Luxembourg 2. Residential real estate includes existing dwellings, dwellings to be built (as per contract) or land that can be used for the construction of residential real estate dwellings. Loans that are granted to a legal entity should not be included in the reporting. This implies that loans granted indirectly to natural persons for investment purposes through ‘Société civile immobilières’ or SOPARFIs are excluded from the reporting. It should be noted that real estate credit provided to such entities falls under the scope of commercial real estate (CRE), and related indicators are part of a dedicated reporting, and in the AnaCredit reporting. 2.</li>\n</ol>\n<p>Process</p>\n<p>This circular specifies the residential real estate data that will be collected through a dedicated RRE data template. The data will be collected by the CSSF semi-annually in the months of April and October each year. The reference date for the data collection will be the 31st of December and the 30th of June respectively. A template specifying the data to be reported can be found in the annexThe template specifying the data to be reported can be found on the CSSF website. Lenders that are active in the residential real estate sector are expected to be able to produce the requested data at a semi-annual frequency.</p>\n<p>The text above is the opening of the document; the PDF carries the whole.</p>\n<p><a href=\"https://www.cssf.lu/en/Document/circular-cssf-20-737/\" target=\"_blank\" rel=\"noreferrer\">Document page</a>, <a href=\"https://www.cssf.lu/wp-content/uploads/cssf20_737eng.pdf\" target=\"_blank\" rel=\"noreferrer\">PDF</a>. Source: Commission de Surveillance du Secteur Financier (CSSF), reproduced with the CSSF's consent. The French text prevails.</p>"}