Dáil Éireann Debate, Wednesday - 19 February 2014
93. Deputy Pádraig Mac Lochlainn asked the Minister for Finance his plans to split the regulator into two agencies, one that is responsible for prudential regulation and another responsible for financial conduct. [8501/14]
View answerA whole series of reforms have been introduced since the financial crisis to underpin a more effective and efficient financial regulatory regime. The Central Bank Reform Act 2010 gave effect to significant structural changes in the operation of financial regulation in Ireland. The Act created a single unitary body - the Central Bank of Ireland - responsible for both central banking and financial regulation. The new structure replaces the previous related entities, the Central Bank and the Financial Services Authority of Ireland and the Financial Regulator. The Central Bank Commission was established by the Central Bank Reform Act 2010 and is responsible for ensuring that the statutory functions of the Central Bank are properly discharged. The Central Bank is now organised into directorates which report to the Deputy Governor (Central Banking), the Deputy Governor (Financial Regulation) or the Chief Operations Officer. The Central Bank Reform Act commenced on 1 October 2010.
The Central Bank (Supervision and Enforcement) Act 2013 further strengthened the ability of the Central Bank to impose and supervise compliance with regulatory requirements and to undertake timely prudential interventions. The 2013 Act also provides the Central Bank with greater access to information and analysis and underpins the credible enforcement of Irish financial services legislation in line with international best practice.
In 2012, the Central Bank published its three-year Strategic Plan for the period 2013-2015 which sets out a strategy of assertive risk-based supervision, underpinned by a credible threat of enforcement, in order to deliver on its key strategic priorities over the coming years. The Central Bank intends that reform of its regulatory and supervisory framework will be deepened over the term of the plan to minimise future risks to financial stability and enhance consumer protection, while continuing to promote a better functioning financial sector.
I am satisfied that the reforms introduced in recent years have brought our regulatory system into line with international best practice. A number of further changes are being introduced as part of the wider EU reform agenda - which was advanced significantly under the Irish EU Presidency - and it will be necessary to review the need for future changes on an ongoing basis to take account of emerging best practice in regulation and to keep pace with developments in the modern financial services sector.
