The capital adequacy requirements as defined under the Law and the relevant capital adequacy directives issued by CySEC shall be fulfilled throughout the course of the operation of each investment firm.

The current prudential rules, the Capital Requirements Regulation and Capital Requirements Directive (CRD IV) were introduced in June 2013. Despite being developed with banks in mind, CRD IV also applies to investment firms. The new prudential regime applies  to all MiFID II firms.

Capital Adequacy Ratio (CAR) is also known as Capital to Risk (Weighted) Assets Ratio (CRAR) is a measurement of an available capital expressed as a percentage of a risk-weighted credit exposures.  CAR is critical to ensure that company has enough cushion to absorb a reasonable amount of losses before  becoming insolvent.

Additionally in accordance with Regulation (EU) No. 575/2013 (the “Capital Requirements Regulation”, “CRR”), which was introduced in late 2014, Investment firms are obliged to disclose its risk management, capital structure, capital adequacy, its risk exposures as well as the most key characteristics of the CIFs corporate governance including its remuneration system.

Our company can help you to meet capital requirements and assist you with preparation or reviewing of the capital adequacy and large exposures statements to be submitted to regulator.

For more information, please feel free to contact us.