Dáil Éireann Debate, Tuesday - 3 December 2013
54. Deputy Pearse Doherty asked the Minister for Finance if he has confidence in the Governor of the Central Bank of Ireland's ability to ensure that Irish-regulated banks are adequately providing for loan losses in their books of account. [51325/13]
View answer55. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to statements made by the former chairman of the International Accounting Standards Board (details supplied), who criticised the Governor of the Central Bank at a British House of Commons parliamentary commission on banking standards in January 2013; and if he will make a statement on the matter. [51326/13]
View answerI propose to take Questions Nos. 54 and 55 together.
Ensuring that Irish regulated banks are adequately providing for loan losses in their books of account is the responsibility of the Governor of the Central Bank and I have full confidence in his ability to fulfil that role.
As regards the comments attributed to the debate in the House of Commons Parliamentary Commission, and referred to by the Deputy, I would like to outline the position as it applies in Ireland.
In the first instance, the individual Board of each Bank is responsible for ensuring that there is adequate provisioning in their respective institution. This process is carried out in conjunction with the individual bank auditors, and the Central Bank, in its capacity as regulator, has an oversight function in relation to this process. AIB, Bank of Ireland and PTSB have been subject to a PCAR in 2011 and the recently completed Asset Quality Review which has again reviewed the adequacy of the bank provisions.
The Central Bank of Ireland continually monitors the financial position of the Covered Banks including through reviews such as PCAR and the wider Financial Measures Programme. The banks will also be subject to the ECB’s Comprehensive Assessment which is ongoing and will conclude in late 2014. The Central Bank has also produced a paper which sets out the Central Bank of Ireland's best practice guidelines regarding the policies, procedures and disclosures which the State supported covered institutions should adopt for loans and receivables financial assets that are subject to impairment review in accordance with the requirements of International Accounting Standard 39, Financial Instruments: Recognition and Measurement ("IAS 39").
