Hi Przemyslaw,
thank you, my bad - navigation index for RSEC_GENERATE_PASSWORD was not updated in my system and therefore the use of PASSWORD_FORMAL_CHECK within the loop in FM RSEC_GENERATE_PASSWORD itself was not found (and I missed it while briefly looking into the code).
Then my issue is solved as PASSWORD_FORMAL_CHECK is part of generating password logic in RSEC_GENERATE_PASSWORD.
Thank you
Michal