Featured Product

    Central Bank of Ireland Sets Out Strategic Priorities for 2021

    June 02, 2021

    The Central Bank of Ireland published the annual report for 2020, along with the two research pieces that will help inform its approach to tackling the climate risks. The annual report sets out work done in 2020 as well as the strategic priorities for the coming months. The key strategic priorities involve delivering risk-based supervision through supervisory strategies, enhancing the regulatory and supervisory framework, ensuring the financial system provides services that households and business require, strategically influencing and shaping the regulatory policy, and addressing climate change risks.

    The key planned activities under these priorities include the following:

    • Focus on ensuring that there is appropriate support for borrowers in distress and that lenders treat them fairly, through consistent processes and in line with relevant codes and regulations. This will involve lenders engaging effectively with distressed borrowers to deliver appropriate and sustainable solutions and facilitate as many borrowers as practical to return to repaying their debt in a sustainable way, while recognizing and prudently accounting for the level of distress in their books.
    • Maintain supervisory focus on the financial and operational resilience of firms and markets, to ensure they continue to support households and businesses through the economic disruption caused by COVID-19 and that they operate in the best interests of the wider economy.
    • Focus on strong governance and risk management capabilities in firms and markets to improve culture and decision-making and to ensure that the risks are identified, managed, and effectively mitigated, including the risks from disruptive change such as technological and market innovation, as well as climate-related financial risks.
    • Achieve progress in a number of key areas such as the EBA stress testing exercises, the annual Supervisory Review and Evaluation Process, the safeguarding of client assets and management company effectiveness, and the development and implementation of appropriate frameworks and policies. Also make progress with preparation for the implementation of the Investment Firms Regulation and Directive (IFR and IFD) to ensure investment firms are supervised in line with this new framework.
    • Ensure that firms identify risks or threats to the long-term sustainability of their business models and advance digital and business strategies to support business model sustainability and transformation; also ensure that boards and executives ensure that data aggregation and risk reporting practices are subject to strong Board oversight.
    • Enhance the regulation and supervision of firms for climate risk. Central Bank of Ireland wants to see firms well prepared to deal with a rapidly evolving operating environment, including the transition to a sustainable economy.
    • Propose introduction of regulations in accordance with Section 48 of the Central Bank (Supervision and Enforcement) Act 2013: it is the view of the Central Bank of Ireland that pre-emptive recovery planning is necessary to facilitate increased awareness and preparedness within firms. Pre-emptive recovery planning will inform strategic decision-making processes during a crisis. Developing a strategy during an extreme stress can limit the scope of the planning, the detail of the review, and the efficacy of decision-making. 
    • Contribute to and shape the ongoing integration of the single market in financial services and the completion of the Banking Union. Central Bank of Ireland supports the ongoing integration of the Single Market for financial services in the EU based on high quality regulation, supervision, resolvability and macroprudential policy as it will ensure a more effective and efficient functioning of financial markets, delivering better outcomes for the economy, consumers and investors. An important part of this work is developing the Single Rulebook for the European financial system and convergent approaches to supervisory outcomes across the EU.
    • Pursue the evolution of the EU regulatory framework in the context of rapid technological innovation. The rapid evolution of technological change in financial services requires a corresponding enhancement of the regulatory framework to mitigate emerging risks and anticipate future ones. 

    In addition, Central Bank of Ireland announced its participation in the USD-denominated green bond investment fund for central banks, which is established by BIS. The Central Bank of Ireland also published two pieces of research that will help to inform its approach to climate-related risks. One of the research pieces examine the green bond market in Europe. It finds that Irish-resident investment funds hold the majority of green bonds in Ireland. Credit institutions are the second largest holder, followed by insurance corporations. The second research report presents the results of a survey of insurance firms’ exposures to and preparedness for emerging risks, including climate risks. The results provide a number of key insights into how insurers are managing climate risks. Respondents indicated that physical and transition risks are the most material risks arising from climate change, while 11% of firms indicated that reputational risks were a concern. The findings also show that a majority (84%) of firms have management structures in place for oversight of climate risks. However, they also indicate a need for firms to take further steps to fully assess the impact of these risks on their business model, as 54% of respondents indicated they did not have a climate strategy, plan, or policy in place. The results from the survey will inform the supervisory approach going forward.

     

    Related Links

    Keywords: Europe, Ireland, Banking, Insurance, Climate Change Risk, ESG, Strategic Priorities, COVID-19, IFR, IFD, Investment Firms, Green Bonds, Green Finance, Governance, Central Bank of Ireland

    Featured Experts
    Related Articles
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    News

    ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite

    The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.

    December 22, 2022 WebPage Regulatory News
    News

    FCA Sets up ESG Committee, Imposes Penalties, and Issues Other Updates

    The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.

    December 20, 2022 WebPage Regulatory News
    News

    FSB Reports Assess NBFI Sector and Progress on LIBOR Transition

    The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.

    December 20, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8697