Good morning and welcome to the launch of our first Financial Stability Review of 2026 . During 2026, risks facing the domestic financial system from the global environment have intensified. In 2025, the origin of external risks related primarily to swings in global trade policy. This year, the origin relates to the pricing, and the sustainability of global energy supplies, following the start of the war in the Middle East. This shock, coming less than a year after the previous trade shock, a...
BankAsset ManagerAll Firms
Risks to Ireland's financial system from the global environment have intensified, Central Bank of Ireland has said today. The Financial Stability Review , published today, assesses the risks to and resilience of the Irish financial system. A persistent global energy supply shock triggered by the conflict in the Middle East, the risk of a correction in financial markets, potentially amplified by financial vulnerabilities in parts of the global non-bank sector, and increasing cyber risks could ...
BankAsset ManagerAll Firms
No description available.
Asset ManagerBankBroker Dealer
1 We are at the early stages of a potential technological rewiring of finance. Fast-forward ten or twenty years, and it seems likely that the use of shared, programmable ledgers – and the tokenisation of financial assets – will have become embedded across the financial system. Today, we stand at a juncture. The question is less whether the technology will transform finance. Rather, it is how we collectively shape this ongoing transition, so that the potential of tokenised finance is realised,...
The Deputy Governor’s speech sets out the Central Bank of Ireland’s (CBI) emerging regulatory stance on tokenised finance and distributed ledger technology (DLT), framing it as a structural transition rather than a niche innovation. While it does not introduce new binding rules, it clearly signals supervisory expectations, impending policy development (including follow‑up to the March 2026 Discussion Paper on tokenisation and DLT), and the need for regulated firms to integrate tokenisation risks, governance and operational resilience into existing regulatory frameworks.
What Changed
- - The CBI formally recognises tokenisation and shared, programmable ledgers as a likely core infrastructure of the future financial system and signals that regulation will evolve to treat tokenised...
- The speech confirms that CBI’s regulatory approach will be “technology‑neutral but not technology‑blind”, indicating that existing EU and Irish rules (e.g.
- The CBI emphasises the need to keep central bank money at the core of tokenised finance, aligning its stance with Eurosystem work on wholesale and retail central bank digital currency (CBDC) and...
- The speech reinforces that tokenised instruments representing traditional financial assets (securities, deposits, fund units) will generally be treated as regulated financial instruments, triggering...
- The CBI highlights operational resilience, cyber risk, interoperability and smart‑contract governance as critical supervisory focus areas for tokenised finance infrastructure and platforms.
Suggested Considerations
- Map all current and planned tokenisation and DLT initiatives (including pilots and proofs of concept) across the group and identify which EU and Irish regulatory regimes they fall under (MiFID II, UCITS, AIFMD, CRR/CRD, PSD2/PSR, Solvency II, MiCA, DORA, etc.).
- Perform a regulatory gap analysis to confirm that tokenised products and services are fully captured within existing licensing permissions and assess whether any variation of permission, new authorisation, or recognition as a market infrastructure is required.
- Review and update governance arrangements so that boards and senior management explicitly oversee tokenisation strategies, risk appetite, and the use of DLT, including ensuring clear allocation of responsibilities under the firm’s senior manager or fitness and probity framework.
- Integrate tokenisation‑specific risks into the firm’s risk management framework, covering legal enforceability of tokens, smart‑contract risk, cyber and operational resilience, data integrity, interoperability, concentration risk in technology providers, and settlement and counterparty risk.
- Review outsourcing and third‑party risk management frameworks to ensure that DLT platform providers, smart‑contract developers, node operators and custodians are treated as critical or important outsourced service providers where appropriate, with robust contractual, oversight and exit provisions.
Key Dates
- CBI publishes its Discussion Paper on tokenisation and distributed ledger technology in financial services, initiating a structured consultation on tokenised markets, funds, money and payments
- Deputy Governor speech sets out the CBI’s strategic approach to tokenised finance, confirming that consultation feedback will inform subsequent policy, supervisory expectations and potential rule changes
- Closing date for submissions to the CBI Discussion Paper on tokenisation and DLT, after which CBI will prepare a feedback statement and refine its policy stance
- CBI feedback statement on the tokenisation Discussion Paper expected, likely followed by more granular guidance and potential adjustments to supervisory and authorisation processes for tokenised activities
Compliance Impact
Non‑compliance will not immediately trigger new standalone tokenisation fines, but CBI is likely to use existing conduct, prudential, governance and operational resilience powers to challenge poorly controlled tokenised activities and may restrict or prohibit projects that do not meet its expectations. Firms that treat tokenised finance as “outside the regulatory perimeter” or fail to integrate it into existing compliance frameworks risk supervisory intervention, authorisation issues, enforcement action and reputational damage.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
Governor of Central Bank of Ireland Gabriel Makhlouf today (Tuesday 19 th May) spoke at the AFME Annual European Financial Integration conference , where he called for a more ambitious approach to Europe’s Single Market, arguing that greater integration in goods, services and capital is essential to enhance European competitiveness and resilience. The Governor outlined two primary conditions for building a genuine single capital market: completing the regulatory architecture and establishing ...
All Firms
Thank you for the invitation to speak this afternoon. I want to talk about the Single Market, which is one of Europe's greatest political and economic achievements. Over more than three decades, it has been an engine of European growth and resilience, delivering scale, opportunity, and tangible benefits for citizens and businesses across the Union. As António Costa has pointed out, it connects 450 million consumers and 32 million companies, supporting around 56 million jobs through trade with...
All Firms
Introduction Good morning – I am delighted to be here, and many thanks to Brian and the BPFI for hosting us. 1 I very much look forward to the discussion, and to hearing from you all today, but before I do I would like to set out some reflections on a number of topics which are currently high on the regulatory agenda. While the discussion is multifaceted, and tied up with a regulatory cycle which has turned, an economic one which has become more challenging, not to mention a renewed focus by ...
All Firms
Central Bank loan-level research shows the Irish lending market is significantly less concentrated when considering the full diversity of lenders. Robust capital and liquidity positions have served the sector well – with the evidence not supporting a lowering of overall levels of resilience on the basis of bank credit, profitability or international competitiveness. Central Banks best serve these broader objectives related to productivity and growth by delivering on their core mandates, effec...
Bank
I was in Washington for the Spring Meetings of the International Monetary Fund (IMF) two weeks ago and this week I was in Frankfurt at the latest meeting of the ECB Governing Council, to decide interest rates to achieve our price stability target of 2 per cent inflation over the medium term. I wanted to use this blog to offer some reflections on both meetings. Inevitably the war in the Middle East cast a shadow over both meetings. Uncertainty about the global outlook dominated the discourse: ...
All Firms
Safeguarding Financial Integrity – Central Bank of Ireland’s Approach to Financial Crime Prevention Thank you for the invitation to speak at today’s event. This is an important opportunity for us to engage and share our experiences and approaches to deal with the global challenges and issues we are facing in financial crime. Change, instability, flux, unpredictability - all words that I guarantee you will hear on multiple occasions throughout the day’s events. I will not be any different. We ...
Bank
Good morning. Brendan, thank you for the warm introduction. It is a pleasure to join you at the ILCU Internal Audit Services Conference. I also want to thank Barry Harrington for the invitation to address you here today. 1 When I addressed the ILCU Annual Conference last April, I spoke about a time of transformative change for credit unions, a period that would bring both significant opportunities and important challenges. 2 One year on, we can see that transformation taking shape. A revised ...
All Firms
No description available.
Asset ManagerBroker DealerBank Today, the High Court published its written judgment in the matter of the Central Bank’s application under the Fitness & Probity Regime to confirm the one-year prohibition issued to a senior executive on 02 February 2022 concerning his role in a regulated firm in the investment fund and asset management sector. The decision of the High Court was to refuse the application. The Central Bank acknowledges the importance of the Court’s findings and the clarity that the judgment provides in this ca...
The Central Bank of Ireland (CBI) issued a statement on 17 April 2026 acknowledging a High Court judgment refusing to confirm a one-year prohibition on a senior executive in the investment fund and asset management sector due to inadequate fair procedures during the CBI's Fitness & Probity (F&P) investigation. This matters for compliance professionals as it underscores the critical need for robust fair procedures in F&P processes and highlights recent legislative and guidance enhancements under the Individual Accountability Framework (IAF) Act 2023 to address such shortcomings. Firms must prioritize these updates to mitigate enforcement risks.
What Changed
- - Legislative enhancements via IAF Act 2023: Introduced changes to strengthen CBI's investigation and prohibition powers under the F&P Regime, including additional safeguards for fair procedures in...
- Updated Regulations and Guidance (April 2023): CBI published revisions reflecting IAF Act changes, focusing on improved investigation and decision-making processes...
- CP-150 Consultation (2025): Led to updated Guidance on consolidated Fitness and Probity Standards, separate from F&P investigations...
- CP-166 Consultation on Supplemental Guidance: Public consultation on prohibitions closed 25 March 2026; final guidance expected summer 2026...
Suggested Considerations
- Review and implement April 2023 updated F&P Regulations and Guidance to ensure investigations and prohibitions incorporate IAF Act fair procedure safeguards (https://www.centralbank.ie/news/article/press-release-central-bank-statement-on-high-court-judgment-17-april-2026).
- Conduct internal audits of F&P processes, focusing on fair procedures (e.g., notice, representation rights) for senior executives in CF/PCF roles.
- Monitor and prepare for summer 2026 final guidance from CP-166 on prohibitions; submit any late feedback if applicable.
- Train compliance and HR teams on heightened procedural standards, referencing High Court emphasis on fair procedures.
- For firms in investment funds/asset management: Assess PCF suitability assessments against consolidated F&P Standards from CP-150.
Compliance Impact
Urgency: High – The High Court ruling directly critiques CBI's past F&P procedures, signaling elevated scrutiny on fair process compliance; failure risks court refusals of prohibitions, reputational damage, and escalated enforcement. With final CP-166 guidance imminent (summer 2026), firms face immediate pressure to align processes, especially post-IAF Act, to avoid similar outcomes in ongoing or future investigations.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
Asset ManagerWealth ManagerHedge Fund Good morning. I am delighted to join you here this morning – and thank you to Irish Funds for organising this event. 1 As you know, a key part of our job at the Central Bank of Ireland is to focus on ‘tail risks’. Not just what we expect will happen, but what could happen. And the range of possible outcomes that could happen has recently widened considerably. What might have been considered close to unthinkable a few years ago, is no longer so. Unpredictable geopolitical developments – includ...
Asset ManagerHedge Fund
Governor Gabriel Makhlouf of the Central Bank of Ireland today emphasised the critical need to strengthen Europe’s Single Market as the foundation for mobilising the continent’s substantial savings in an increasingly fragmented global environment.
BankAsset ManagerWealth Manager
In his remarks, Governor Gabriel Makhlouf emphasised that Europe must mobilise its substantial savings by strengthening economic growth, completing the Single Market, and building more integrated capital markets, as capital currently flows abroad due to perceived higher returns elsewhere. He argued that central banks must anchor price stability and financial stability as preconditions for effective capital allocation, and that by addressing these fundamentals, European savings will naturally ...
BankAsset ManagerBroker Dealer
EU Bonds - Central Bank of Ireland Issues Warning on Unauthorised Firm
All Firms
No description available.
BankBroker DealerCrypto Exchange
Good morning everyone, I am delighted to be here for what looks set to be an interesting conference on a topic which is both very close to my heart and central to what we do at Central Bank of Ireland (“the Central Bank”) – as we work to deliver on our mission, and in particular ensuring the financial system is operating in the best interests of consumers and the wider economy. 1 I am particularly delighted to be back in UCD – where I had the pleasure to study economics as an undergraduate, w...
This speech by Deputy Governor Mary Elizabeth McMunn outlines the Central Bank of Ireland's (CBI) shift toward **outcomes-focused regulation and supervision**, emphasizing five key priorities from the 2026 Regulatory and Supervisory Outlook (RSO) to address geopolitical risks, consumer protection, technology, and resilience in a volatile environment. It matters for compliance professionals as it signals intensified CBI scrutiny on firm behaviors and outcomes rather than mere rule compliance, with direct implications for supervisory engagements, thematic reviews, and enforcement across banking, funds, insurance, and payments sectors.
What Changed
- No new legislative changes are introduced in the speech itself, which serves as a practitioner's perspective on implementing the RSO 2026 priorities.
- Resilience to geopolitical/macro risks (operational resilience, cyber security, financial resilience).
- Consumer/investor protection (customer experience, digitalisation risks, financial crime/fraud).
- Technology transformations (AI, digital money, tokenisation).
These build on prior developments like the revised Consumer Protection Code (CPC), DORA implementation, and enhanced AML/CFT frameworks,...
Suggested Considerations
- Conduct gap analyses for revised CPC compliance, focusing on thresholds, customer experience, and fraud support (immediate if in-scope).
- Enhance resilience frameworks: Map operational/cyber risks, perform realistic scenario testing, document risk management for geopolitical/macro uncertainties.
- Strengthen financial crime controls: Improve fraud detection, victim support, scam awareness; update AML/CFT via enhanced questionnaires and transaction monitoring.
- Review technology/AI governance: Assess AI models, digital innovations (e.g., tokenisation); engage CBI supervisors pre-implementation; ensure data quality/reliability.
- Embed ESG/climate risks: Integrate into governance/business models; prepare for desktop/onsite reviews and greenwashing checks.
Key Dates
- Revised Consumer Protection Code (CPC) takes effect (12-month lead-in complete; firms must be compliant)
- DORA implementation including threat-led penetration testing (survey issued H1)
- Enhanced AML/CFT Risk Evaluation Questionnaire
- Thematic inspection of transaction monitoring and STR reporting
- UCITS Value at Risk (VaR) model review and depositary oversight
Compliance Impact
Urgency: High – The speech, delivered today (9 March 2026), underscores imminent RSO 2026 execution with CPC effective in 2 weeks (24 March 2026) and H1 2026 activities (e.g., DORA testing, AML questionnaires) starting soon. Non-compliance risks intensified supervision, thematic inspections, enforcement, and reputational damage in a high-geopolitical-risk environment; outcomes-focus demands proactive evidence of resilience and consumer safeguards over procedural box-ticking.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
BankAsset ManagerInsurance
Central Bank of Ireland today published a Discussion Paper examining the potential role of Distributed Ledger Technology (DLT) and tokenisation in the financial system . Deputy Governor Vasileios Madouros, commenting on the publication, said: “Distributed ledger technology and tokenisation have the potential to transform how financial services are delivered. We believe this technology, if enabled and deployed correctly, can change the financial system for the better, including by helping the ...
The Central Bank of Ireland (CBI) has launched Discussion Paper 12 (DP12) on Distributed Ledger Technology (DLT) and tokenisation in financial services to explore their transformative potential in areas like markets, funds, payments, and money, while assessing opportunities, risks, and enablers such as legal clarity and interoperability. This matters for compliance professionals as it signals CBI's proactive stance on integrating these technologies into a resilient financial system, aligning with EU ambitions like the Savings and Investment Union, and invites stakeholder input to shape future policy without proposing immediate rules. (Source: https://www.centralbank.ie/news/article/press-release-discussion-paper-tokenisation-and-distributed-ledger-technology-in-financial-services-5-march-26 [publication]; https://www.arthurcox.com/insights/central-bank-issues-discussion-paper-on-dlt-tokenisation-in-financial-services/ )
What Changed
This is a non-binding discussion paper, not a regulatory change or new requirement; it poses 16 questions on topics including legal recognition of tokenised instruments, governance, infrastructure, funds (e.g., tokenised MMFs and ETFs), payments, and risks like operational resilience and interoperability. It highlights needs for policy intervention to avoid fragmented "walled gardens," ensure central bank money's role, and address challenges in fractionalisation, transparency, and settlement finality, but no mandates are imposed yet.
Suggested Considerations
- Review DP12 (PDF available via CBI site) and prepare/ submit responses to the 16 questions by 5 June 2026, focusing on legal clarity, risks, funds tokenisation, and enablers like interoperability.
- Engage in CBI's structured stakeholder dialogues to influence future frameworks.
- Assess internal DLT/tokenisation pilots or plans against discussed risks (e.g., operational resilience, scalability) and opportunities (e.g., fractional ownership, 24/7 liquidity).
Key Dates
- Deadline for stakeholder submissions responding to the 16 questions in DP12
5 June 2026; - CBI to publish a feedback statement assessing responses and existing policy fit. (Source: https://www.centralbank.ie/news/article/press-release-discussion-paper-tokenisation-and-distributed-ledger-technology-in-financial-services-5-march-26 [publication]; https://www.arthurcox.com/insights/central-bank-issues-discussion-paper-on-dlt-tokenisation-in-financial-services/ )
Compliance Impact
Urgency: Medium – This consultative paper poses no immediate rules but represents a key opportunity to shape emerging DLT/tokenisation regulation amid CBI's 2026 priorities on tech-driven transformations and resilience; inaction risks missing input on critical enablers like legal finality for tokens, potentially leading to stricter future requirements misaligned with firm needs. It aligns with broader EU/BIS pushes (e.g., MiCA, tokenized reserves), amplifying relevance for firms in funds, payments, and crypto.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
No description available.
Asset ManagerBankBroker Dealer
It is a pleasure to be here in Oxford 1 While I’m aware that this is a school of government and I’m a central banker, the two are inextricably linked. Societies and indeed economies are shaped by their institutions, specifically the legal, social, cultural, formal and informal norms that impact the way citizens interact with each other. Successful institutions are those that are trusted by the societies that created them and for which they ultimately serve. Today I am going to resist the oppo...
Governor Gabriel Makhlouf's speech at the Blavatnik School of Government addresses central bank independence as a foundational institutional mechanism for delivering price stability and economic prosperity, rather than as a shield from accountability. The speech is not a regulatory enforcement action or new requirement, but rather a governance statement clarifying the Central Bank of Ireland's institutional philosophy on independence, credibility, and accountability—matters that directly affect how the CBI exercises supervisory discretion over regulated firms.
What Changed
- This is not a regulatory change document but a governance clarification with compliance implications:
- Reframing of independence: Central bank independence is characterized as an "anchor" enabling long-term decision-making rather than isolation from society.
- Credibility framework: Credibility depends on competence, engagement, coherence, and public trust—not institutional distance alone.
- Accountability emphasis: Independence requires continuous dialogue with society and other economic governance institutions; it "does not mean isolation."
- Historical validation: The speech references the 1960s-1970s macroeconomic instability under political pressure versus post-pandemic effectiveness of credible central banks in controlling inflation.
Suggested Considerations
- *Understand CBI decision-making philosophy: Recognize that CBI supervisory decisions are grounded in long-term economic stability objectives, not short-term political cycles.
- *Align governance with credibility principles: The speech identifies four credibility pillars—competence, engagement, coherence, and public trust. Regulated firms should ensure their governance frameworks reflect these principles in their own operations.
- *Monitor 2026 supervisory priorities: The speech references CBI's published 2026 Regulatory and Supervisory Priorities, which include maintaining resilience to geopolitical risks, securing consumer and investor interests, and delivering new responsibilities under Access to Cash legislation.
Key Dates
- Ireland assumes EU Council Presidency; CBI will support government during this period
- CBI published its 2026 Regulatory and Supervisory Priorities, which establish the operational framework within which this governance philosophy applies
- This speech delivered, reinforcing institutional independence principles
Compliance Impact
Urgency: MEDIUM
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
BankAsset ManagerPayment Provider Introduction Good morning and thank you to Michael for inviting me to speak at the Compliance Institute’s Annual General Meeting. It is always a real pleasure to engage with compliance professionals. At the Central Bank, we recognise the essential role played by the compliance community in ensuring that financial firms are well-run and contributing to a financial system that is trusted and resilient. We also recognise the important role played by the compliance institute, equipping those work...
This speech by Gerry Cross, Director of Capital Markets and Funds at the Central Bank of Ireland (CBI), outlines key supervisory priorities including securing customers' interests via the revised Consumer Protection Code, Individual Accountability Framework (IAF) implementation, regulatory simplification, resilience, technology leverage, and an evolving outcomes-focused supervision approach. It matters because it signals CBI's expectations for compliance professionals to drive these outcomes in firms, emphasizing proportionality and ongoing engagement amid regulatory evolution. Compliance teams must integrate these themes to align with CBI's shift toward less process-driven, more effective oversight.
What Changed
- - Revised Consumer Protection Code: Introduces new Standards for Business, building on the Code reviewed with industry input; focuses on delivering good outcomes for consumers and the economy.
- Individual Accountability Framework (IAF): Implemented 18 months prior (circa mid-2024); enhances clarity on responsibilities, supports governance, and aligns with outcomes-focused regulation rather...
- Supervisory Approach Evolution: Shifting in 2025-2026 to risk-based, outcomes-focused, less process-driven supervision integrated across financial stability, consumer protection, safety/soundness,...
- Regulatory Simplification: Openness to reviewing frameworks (e.g., fitness and probity) for simpler, outcomes-based alternatives without compromising effectiveness; supports broader simplification...
- Resilience and Technology: Ongoing focus on financial resilience post-reforms, leveraging technology for supervision; no specific new rules but emphasis on embedding these in operations.
No new...
Suggested Considerations
- Implement Revised Consumer Protection Code: Complete readiness by 24 March 2026; apply new Standards for Business in operations, leveraging CBI workshops for guidance.
- Embed IAF: Maintain enhanced responsibility mapping, support decision-making, and engage with CBI on implementation feedback to mature governance.
- Adopt Outcomes-Focused Practices: Shift from process-driven to outcomes-based compliance (e.g., customer interests, resilience); review internal frameworks for simplification opportunities.
- Engage with CBI: Participate in ongoing consultations, workshops, and stakeholder feedback on supervision evolution, IAF, and Consumer Protection Code.
- Leverage Technology: Integrate tech for resilience and compliance efficiency, aligning with CBI's supervisory priorities.
Key Dates
- Revised Consumer Protection Code comes into force; firms must ensure full readiness and ongoing embedding of provisions, including new Standards for Business
Compliance Impact
Urgency: Medium. This speech reinforces imminent obligations like the 24 March 2026 Consumer Protection Code effective date (less than 2 months from speech/publication), requiring immediate readiness checks, but lacks new rules or critical enforcement threats. It matters for long-term alignment with CBI's outcomes-focused supervision, reducing future supervisory risks through proactive embedding of IAF and simplification; non-engagement could signal poor governance amid evolving oversight.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
Asset ManagerBankAll Firms
CFD Trades 24 – Central Bank of Ireland Issues Warning on Unauthorised Firm
Broker DealerWealth ManagerFintech
Clermont Meridian Trading - Central Bank of Ireland Issues Warning on Unauthorised Firm
Broker DealerWealth ManagerFintech
The Central Bank of Ireland has today (Tuesday 23 July) published a Feedback Statement to the Discussion Paper on an approach to macroprudential policy for investment funds.
The Central Bank of Ireland (CBI) published a Feedback Statement on 23 July 2024 summarizing stakeholder responses to its Discussion Paper (DP11) on developing a macroprudential policy framework for investment funds, emphasizing the sector's growth and systemic risks. This matters for compliance professionals as it signals ongoing domestic and international efforts to enhance fund resilience amid rapid expansion of non-bank financial intermediation (NBFI), with Ireland's funds sector reaching €6.2 trillion in assets by end-2022. No immediate new rules are imposed, but it underscores evaluation of existing measures and future policy evolution.
What Changed
- This Feedback Statement introduces no new regulatory changes or requirements; it is a summary of feedback on DP11 and CBI's perspectives on macroprudential considerations for funds.
- Restrictions on leverage and liquidity mismatch for Irish-authorised property funds (introduced prior to 2024).
- A codified minimum 300bps yield buffer for Irish-authorised GBP-denominated Liability Driven Investment (LDI) funds, requiring resilience to UK interest rate shocks, with liquid assets in the buffer...
Suggested Considerations
- For property funds: Continue adhering to pre-existing leverage/liquidity mismatch limits.
- All relevant managers: Monitor CBI updates on measure evaluations, conduct ongoing vulnerability analysis, and prepare for potential toolkit expansions (e.g., stress testing, data sharing). Engage in international coordination via FSB/IOSCO and EU consultations.
- General: Review fund strategies for systemic risks, update governance for macroprudential oversight, and align with CBI's DP11 principles.
Key Dates
- Consultation deadline for CP157 on macroprudential measures for GBP LDI funds
- Announcement and start of three-month implementation period for GBP LDI yield buffer measures
- Publication of Feedback Statement to DP11 on macroprudential policy for investment funds
- Effective date for GBP LDI funds' minimum 300bps yield buffer compliance (three months post-announcement)
- CBI response to European Commission consultation on macroprudential policies for NBFI
Compliance Impact
Urgency: Medium—No new rules from the Feedback Statement itself, reducing immediate pressure, but firms must ensure full compliance with implemented LDI (by July 2024) and property fund measures while preparing for evaluations and EU-level developments (e.g., November 2024 CBI response). This matters as Ireland's funds dominance (global hub status, 16% of world financial assets) amplifies systemic scrutiny, with non-compliance risking supervisory actions under AIFMD Article 25 or future tools; proactive monitoring prevents disruptions in a €68 trillion global sector.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
Asset ManagerHedge Fund
The Central Bank of Ireland has today (29 April 2024) announced the introduction of macroprudential measures for Irish-authorised GBP-denominated Liability Driven Investment (LDI) funds. Building on the recent Consultation Paper “Macroprudential measures for GBP Liability Driven Investment funds”, the measures require that GBP-denominated LDI funds authorised in Ireland maintain sufficient resilience to be able to withstand a sudden and adverse shocks to UK interest rates.
The Central Bank of Ireland (CBI) introduced binding macroprudential measures on 29 April 2024 requiring Irish-authorised GBP-denominated Liability Driven Investment (LDI) funds to maintain a minimum **300 basis point yield buffer** to withstand adverse UK interest rate shocks. This regulatory intervention directly addresses systemic risks exposed during the September-October 2022 UK gilt market crisis, where excessive leverage in LDI funds amplified financial stress across markets.
What Changed
- The framework establishes the following core requirements for in-scope GBP-denominated LDI funds:
Yield Buffer Requirement
- Minimum resilience threshold of 300 basis points increase in UK yields
- CBI clarifies this is a minimum floor, not a target; funds may prudently maintain higher buffers
- Assets must be sufficiently liquid under both normal and stressed market conditions
Yield Buffer Composition Rules
- "External assets" or "third-party assets" cannot be included in the yield buffer
Suggested Considerations
- *For Existing Fund Managers (by 29 July 2024):
- *Audit & Classification: Determine whether each fund falls within the regulatory scope by assessing whether the investment strategy matches asset sensitivity to UK interest rates/inflation against pre-defined investor liabilities
- *Yield Buffer Assessment: Calculate current yield buffer position and identify any shortfalls against the 300 bps minimum threshold
- *Portfolio Restructuring: If necessary, rebalance portfolios to achieve and maintain the 300 bps yield buffer, ensuring:
- Removal of external/third-party assets from buffer calculations
Key Dates
- CBI announces finalised macroprudential framework
- Compliance deadline for existing Irish GBP-denominated LDI funds authorised before 29 April 2024 (3-month implementation period)
- Compliance requirement for newly authorised LDI funds after 29 April 2024
- New funds seeking authorisation must notify CBI of framework scope applicability
Compliance Impact
Urgency Rating: HIGH
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
Asset ManagerHedge FundWealth Manager
I’d like to thank Insurance Ireland and Milliman for inviting me here today for this Chief Risk Officer (CRO) Forum. I’d like to use this opportunity to briefly reflect on the recent turmoil we’ve seen in the banking sector, what this might mean for (re)insurers, and to highlight some of our supervisory priorities going forward. Much commentary has already been devoted to the fallout from SVB and Signature Bank in the US, and to the acquisition of Credit Suisse by UBS. Whilst the exposure of ...
BankInsurance
Introduction Good morning everyone. Thank you for inviting me to speak here today. Before I begin, I’d like to acknowledge the important role played by Financial Services Ireland in advocating for its members, and in promoting the Irish financial services sector, both here and abroad. Whilst the respective missions we undertake are undoubtedly different, we have a shared interest in a strong and stable financial services sector. It is claimed that the phrase “may you live in interesting times...
Insurance
Introduction Good morning, and thank you for attending our Insurance Industry Event, the second of these which we’ve held virtually. Hopefully, as the vaccine rollout continues and restrictions are eased, there won’t have to be a third! The COVID 19 crisis has brought about a significant amount of change to all of our personal and professional lives, and with it has provided the opportunity to reflect on what is important, and where our priorities should lie. With this in mind, I would like t...
Insurance
Opening remarks at the 2020 Insurance Industry Briefing Good morning everyone. I would like to thank you for attending today’s industry briefing. In my remarks this morning, I will take this opportunity to touch on: the role that insurance can play in society; some of the reasons why the industry in Ireland is negatively perceived; and the areas of supervisory focus for the Central Bank moving forward. 2020 has been an unprecedented year in so many respects and the emergence of COVID-19 has a...
BankInsurance
I am joined today by Gráinne McEvoy, Director of Consumer Protection, and Domhnall Cullinan, Director of Insurance Supervision. Thank you for this opportunity to speak to you today about the Central Bank’s work in regulating and supervising the Irish insurance industry and specifically the practices of differential pricing and dual pricing. Insurance serves a critical role in the functioning of a modern society, through reducing uncertainty by protecting people and businesses against the risk...
BankInsurance
Settlement Agreement between the Central Bank of Ireland and Merrion Stockbrokers Limited Merrion Stockbrokers Limited fined €200,000 by the Central Bank of Ireland in respect of failings pursuant to the Fitness and Probity regime. On 12 December 2017, the Central Bank of Ireland (the ‘Central Bank’) fined Merrion Stockbrokers Limited (‘Merrion’) €200,000 and reprimanded it for a breach of section 21 of the Central Bank Reform Act 2010 (the ‘2010 Act’). Merrion has admitted this breach, which...
The Central Bank of Ireland (CBI) fined Merrion Stockbrokers Limited €200,000 on 12 December 2017 for breaching section 21 of the Central Bank Reform Act 2010 by failing to implement adequate systems and controls under the Fitness and Probity (F&P) regime from 1 December 2011 to at least April 2015. This first-ever enforcement action against a firm for section 21 violations underscores firms' primary responsibility for ongoing due diligence on Controlled Functions (CFs) and Pre-Approval Controlled Functions (PCFs), signaling heightened CBI scrutiny on governance and accountability post-financial crisis.
What Changed
- This 2017 enforcement does not introduce new regulatory changes but enforces existing requirements under the F&P regime, established via the Central Bank Reform Act 2010 and effective from 1 December...
- Firms must maintain adequate systems and procedures for initial and ongoing due diligence to ensure CFs/PCFs meet F&P Standards (fitness: competence, integrity; probity: honesty).
- Ongoing monitoring beyond initial checks, with written records and centralized documentation for each individual.
- Accurate classification of roles as CFs/PCFs; failure here constituted a breach.
No subsequent statutory changes are noted in the publication, but it reinforces that firms bear ultimate...
Suggested Considerations
- Develop/improve written policies and procedures for initial and ongoing due diligence on CFs/PCFs, including centralized records per individual.
- Conduct thorough due diligence at appointment and continuously monitor compliance with F&P Standards; maintain demonstrable records.
- Ensure accurate CF/PCF classification for all relevant roles (e.g., executive directors, finance heads, client advisors).
- Implement monitoring systems to detect changes in fitness/probity and report to CBI if Standards are breached.
- Board-level oversight: Review and remediate gaps, as post-2016 Merrion Board did.
Key Dates
- Fitness and Probity regime effective; Merrion's breach period begins
- Management buy-out and new Board appointed; initial compliance improvements start
- Merrion implements first written F&P policies and procedures
- CBI inspection identifies breaches
- CBI imposes €200,000 fine and reprimand via settlement agreement; investigation closed
Compliance Impact
Urgency: Medium - While from 2017, this foundational enforcement remains highly relevant for ongoing F&P obligations, with risks of fines/reprimands during CBI inspections (as in Merrion's 2016 review). It matters because firms hold primary accountability for a regime designed post-crisis to prevent unfit individuals in key roles; non-compliance exposes entities to significant reputational, financial (€200k precedent), and operational risks, especially amid evolving governance scrutiny.
AI-generated analysis. May contain errors or omissions — verify with the
original CBI source
before acting. Full disclaimer.
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