Finian McGrath
Question:161 Deputy Finian McGrath asked the Minister for Finance his views on a matter (details supplied) regarding US advisers. [7832/12]
View answerTuesday, 14 February 2012
Questions (122)
Written answers
The Central Bank of Ireland has instituted a new Fitness and Probity Regime which came into effect on 1 December 2011 and will be fully implemented by 1 December 2012. The Regulations apply to Pre-Approval Controlled Functions and Controlled Functions. The Regulations apply to financial service providers other than Credit Unions. The Regulations identify 41 senior positions as Pre-Approval Controlled Functions such as Chief Executive Officer, Director or Heads of Compliance, Risk, and Internal Audit. Central Bank approval is required before appointments are made to these positions. The Regulations also prescribe specific categories as Controlled Functions and persons performing these functions include the staff that exercise a significant influence on conduct of the affairs of the financial service provider, monitor compliance or perform functions in a customer-facing role. The Fitness and Probity Standards are being implemented on a phased basis as follows:
From 1 December 2011, apply to persons performing Pre-Approval Controlled Functions;
From 1 March 2012, they will apply to persons appointed to Controlled Functions (other than Pre-Approval Controlled Functions). This is to include new offers of employment and internal transfers/promotions which may involve a Controlled Function role after that date;
They will apply to all persons occupying Controlled Functions as at 1 December 2012.
A full overview of the Fitness and Probity regime can be found on the CBI's website at the following link: http://www.centralbank.ie/regulation/processes/fandp/pages/ introductiontofitnessandprobity.aspx
The institution referred to in the Deputy's question has confirmed that a US headquartered firm, was engaged by the Chairman of EBS to perform an independent assessment of the EBS Chief Executive's fitness and probity. The output report was submitted to the Central Bank of Ireland on 3 February. The institution has indicated that the decision to take expert advice was taken in the context of this key position as CEO of the subsidiary and member of the Executive Committee on the institution.
The procurement of external service providers is a matter for the management and board of the institution. I have no role in the day-to-day commercial and operational decisions of the banks, which include these matters. These decisions are taken by the board and management of the institution. As the Deputy will be aware, notwithstanding the fact that the State is a significant shareholder in the institution, the bank is run on a commercial arm's length basis as per the Memorandum on Economic and Financial Policies agreed with the EU Commission, the ECB and the IMF.
In relation to costs incurred, the management and board of the institution are aware of their duties to their shareholders to ensure that all costs incurred by the bank are necessary and reflect the needs of the business.