Central Bank of Ireland Consults on Guidance on Operational Resilience
The Central Bank of Ireland announced that the Virtual Asset Service Providers (VASPs) in Ireland are now required to comply with the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) obligations. This follows as the Fifth Anti-Money Laundering Directive (5AMLD) of EU has been transposed into Irish law by way of the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021. VASPs are required to register with the Central Bank for AML/CFT purposes and have three months to apply to the Central Bank for registration. Additionally, the Central Bank of Ireland proposed the guidance on operational resilience of all regulated financial service providers, with the consultation period ending on July 09, 2021.
The proposed guidance on operational resilience is intended to enhance operational resilience and recognize the interconnections and interdependencies, within the financial system, that result from the complex and dynamic environment in which firms operate. The guidance is built on the three pillars of operational resilience—Identify and Prepare, Respond and Adapt, and Recover and Learn. These pillars support a holistic approach to the management of operational resilience and related risks and create a feedback loop that fosters the perpetual embedding of lessons learned into a firm’s preparation for operational disruptions. The guidance:
- Communicates to the boards and senior management of regulated financial service providers, the Central Bank’s expectations with respect to the design and management of operational resilience
- Emphasizes board and senior management responsibilities when considering operational resilience as part of their risk management and investment decisions
- Requires that the boards and senior management take appropriate action to ensure that their operational resilience frameworks are well-designed, are operating effectively, and are sufficiently robust, in an effort to ensure that risks to the firm’s operational continuity do not transmit into the financial markets
In developing these proposals the Central Bank considered the responses to an operational resilience maturity assessment conducted across a sample of financial services firms in the fourth quarter of 2020. These self-assessments were designed to gain an understanding of firms’ views of their level of operational resilience preparedness. The assessment indicated that firms need to build on existing business continuity management approaches to take an end-to-end business services approach to the operational resilience of critical or important business services. The objective of this consultation exercise is to understand the views and experiences of stakeholders in advance of finalizing the guidance to industry on how to prepare for, respond to, and recover and learn from an operational disruption that affects the delivery of critical or important business services.
Related Links
Comment Due Date: July 09, 2021
Keywords: Europe, Ireland, Banking, Operational Resilience, AML/CFT, Virtual Asset Service Providers, Operational Risk, Business Continuity, Governance, Central Bank of Ireland
Previous Article
BIS Assesses Impact of Basel III Reforms Using Macroeconomic ModelsRelated Articles
BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks
The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.
DNB Publishes Multiple Reporting Updates for Banks
DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.
NBB Sets Out Climate Risk Expectations, Issues Reporting Updates
The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting
EBA Updates Address Securitization Standards and DGS Guidelines
The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.
FSB Publishes Letter to G20, Sets Out Work Priorities for 2023
The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023