Financial Crime World

Central Bank of Ireland Remains Focused on Priorities Since Financial Crisis

Since the 2008 financial crisis, the Central Bank of Ireland (CBI) has continued to prioritize key areas to ensure the stability and resilience of the Irish banking system. In a recent review, the CBI highlighted its ongoing efforts to monitor compliance with mortgage borrower treatment in arrears and encourage banks to implement sustainable restructuring arrangements.

AML Compliance Remains a Key Focus

The CBI has been actively monitoring anti-money laundering (AML) compliance, identifying areas for improvement and implementing measures to strengthen its AML regime. The bank’s efforts have resulted in significant progress in reducing the risk of money laundering and terrorist financing in Ireland.

  • The CBI subjects new non-bank mortgage owners to authorization and supervision to ensure they meet strict standards.
  • The bank has made significant progress in reducing the risk of money laundering and terrorist financing in Ireland.

Sustainable Finance Takes Center Stage

As part of its commitment to sustainable finance, the CBI is working closely with the European Banking Authority (EBA) on the Sustainable Finance Action Plan. This initiative aims to:

  • Enhance ESG risk disclosures
  • Incorporate environmental and social risks into supervisory and evaluation processes
  • Explore dedicated prudential treatment for exposures related to environmentally or socially objectionable assets

Individual Accountability Framework

The CBI has been pushing for legislative change to assign regulatory responsibility to individuals working in regulated entities. The proposed Central Bank (Individual Accountability Framework) Bill 2021 aims to establish a new Individual Accountability Framework, comprising:

  • Conduct standards
  • Senior Executive Accountability Regime
  • Enhancements to the Fitness and Probity Regime
  • Changes to enforcement investigations and enquiries processes

Technological Innovation and Cybersecurity

The CBI has emphasized its focus on technological innovation, including big data and algorithms, to assess risks posed by inappropriate technology use and information asymmetries between firms and customers. The bank is also prioritizing cybersecurity, highlighting the importance of:

  • Limiting impacts from technology failures
  • Mitigating cyberattacks

Culture and Conduct Standards

As part of its efforts to promote a culture of good governance in regulated financial services providers, the CBI has advocated for legislative change to assign regulatory responsibility to individuals. The proposed bill will introduce new conduct standards for all staff, senior management, and businesses, emphasizing:

  • Due care
  • Diligence
  • Honesty
  • Ethics
  • Integrity

In conclusion, the Central Bank of Ireland’s ongoing efforts since the 2008 financial crisis have demonstrated its commitment to ensuring the stability and resilience of the Irish banking system. By prioritizing areas such as AML compliance, sustainable finance, individual accountability, technological innovation, and culture and conduct standards, the bank is working towards a safer and more responsible financial environment for all stakeholders.