As I have previously informed the House, I intend to bring forward heads of a Central Bank (Amendment) Bill for Government approval in Quarter 1 2019. In that regard it is my intention that the proposed legislation will identify the legislative changes that are required to implement a customer centric culture and to enhance individual accountability.
I have long been on the record as stating that there are cultural failings in the banking sector that must be addressed and I have recently spoken of the need to rebuild the bond of trust that has been sundered with society in the wake of the banking crisis. We, in Government, are supportive of measures to change behaviour and organisational culture within the financial sector, in order to keep the customer at the heart of its operations.
The Central Bank's Section 6A Report on the culture and behaviour of the main retail banks was drafted in response to my request in November 2017. The report published in July, puts forward proposals, to enhance individual accountability by way of Conduct Standards for all regulated financial services providers and the individuals working within them; a Senior Executive Accountability Regime; and enhancements to the current Fitness and Probity Regime.
My Department’s assessment of the report found that it is a detailed and considered analysis of culture within the banking sector. The report’s recommendations are intended to drive positive changes in terms of wider banking culture, greater delegation of responsibilities, and enhanced accountability. The report importantly focuses on simplifying the taking of sanctions against individuals who fail in their financial sector roles.
These Central Bank proposals are being considered as part of the work of the Government's forthcoming Central Bank (Amendment) Bill. Officials in my Department are engaging with the Central Bank and other stakeholders in order to provide for measures that are proportionate and effective to achieve the Government’s objective of a sustainable, customer focussed, financial services industry. Policy matters including how proposals may be implemented are currently being examined including an appraisal of international best practice.
It is important that any proposals that are brought before the Houses of the Oireachtas adopt a strategic approach in proposing and bringing through legislation that allows the Central Bank and firms within the financial sector to drive the necessary changes in culture.