I appreciate that in view of the example to which he referred, the Deputy wants to press this amendment to ensure the greater disclosure of loans and other similar types of transactions to persons connected with directors of licensed banks that fall within the scope of section 31 of the Companies Act 1990. I am also very conscious of the need to respect how ordinary business is conducted in the everyday world.
In this regard, given that the making of loans is part and parcel of the ordinary business of banking, I would be reluctant to require in company law disclosure through the accounts of companies that are licensed banks, particulars of individual loans to such parties. I believe the body best placed to make a judgment as to what would be appropriate best practice and most appropriate disclosure requirements is the Financial Regulator. It already has a power to insist on disclosure of the type of loans to which the Deputy referred if it deems that necessary. I am satisfied this is a call that should be left to the regulator.
That said, I would like to explain that the principal reason the special provisions applying to companies which are licensed banks were included in the first instance in the Companies Act 1990 was the necessity at the time of introduction of these provisions, which were essentially introducing restrictions, to also include what were considered at the time to be appropriate reliefs. Since the enactment of those provisions in the Companies Act 1990, there have been significant regulatory developments including, in particular, the establishment of the Financial Regulator through the Central Bank and Financial Services Authority of Ireland Acts 2003 and 2004, the remit of which is to focus specifically on the supervision and regulation of financial entities. The grounding legislation enables the Financial Regulator to attach conditions to licences. I understand the Financial Regulator is considering the imposition of requirements with regard to disclosure of relevant details of loans provided for persons connected with directors of licensed banks.
In addition, there have been significant developments with regard to the regulatory framework relating to the preparation of annual accounts of financial entities such that they are now dedicated requirements with a basis in EU directives specifically for these financial entities. These regulations relating to accounting matters of financial entities are made by the Minister for Finance. It would be my intention to have the specific requirements relating to licensed banks contained in Part 3 of the Companies Act 1990 migrated to the relevant Finance Acts and regulations at the earliest possible opportunity.
I accept that in the meantime the provisions cannot simply be repealed. Accordingly, they must be maintained in the Companies Act, but in a manner that addresses the shortcomings that were identified earlier this year. That is the purpose of the amendments to sections 41 and 43 of the Companies Act 1990 contained in section 8 of the Bill before us. I would like to emphasise two particular points relating to these amendments in so far as they apply to persons connected with directors of licensed banks which are companies. The first point is that the aggregate amounts to be disclosed will now include the aggregate maximum amount outstanding during the relevant reporting period, as well as the number of persons for whom relevant transactions were made. Section 8(2) of this Bill will now insert new subsections in the Companies Act 1990 to accommodate this.
The second point is that section 44 of the Companies Act 1990, as amended by section 9 of the Bill before us, will require disclosure on an individual basis in respect of loans to connected persons of directors of licensed banks which are made on "favourable terms". This disclosure will be made through the statement which is required to be prepared under section 43(3) and must be made available 15 days prior to, and also at, the AGM of the licensed bank in question.
All these provisions are without prejudice to any more detailed or stringent requirements the Financial Regulator might impose. For those reasons, I regret I cannot accept the amendment. I understand the Deputy's concerns, but the evolvement of the review should reassure him. Equally, as demonstrated by section 44 of the Companies Act 1990, there is a requirement to disclose where there are favourable terms.