CENTRAL BANK NEW SUPERVISORY APPROACH
On 28 February 2025, the Central Bank of Ireland introduced its new supervisory approach which seeks to integrate conduct, integrity and prudential supervision. From now on, PRISM will no longer be the Central Bank's framework for the supervision of regulated entities. Instead, only the most significant regulated entities will receive close and continuous supervision with a dedicated supervision team. Less significant entities will be subject to increasing sectoral and cross-sectoral thematic engagements as part of an integrated supervisory approach with multi-disciplinary teams working together to deliver the Central Bank's supervisory priorities.
For more information, read the latest insights from Denise Murray, our Head of Financial Services Compliance and Regulatory Relations here: Central Bank introduces its New Supervisory Approach.
CENTRAL BANK REGULATORY OUTLOOK AND SUPERVISORY PRIORITIES FOR 2025
The Central Bank's Regulatory and Supervisory Outlook 2025, published on 28 February 2025 outlines key themes, risks and supervisory priorities that will shape the Irish financial services industry in 2025.
It highlights the need to balance opportunities like digitalisation and innovation with challenges like geopolitical tensions, political reorientations, dilutions of net zero commitments, and growing regulatory divergence across climate change, financial regulation, crypto regulation, AI, data privacy and DEI policies.
The Report highlights 11 key risk areas: operational resilience and financial crime are areas of elevated risk. Increased reliance on third parties, the growth of technology-led frameworks, ineffective control and immature risk cultures are highlighted as key drivers of risk growth.
The Report identifies 6 supervisory priorities, 5 of which are cross-sectoral. Those cross-sectoral priorities cover proactive risk management and consumer-centric leadership; operational and financial resilience; addressing deficiencies in governance, risk management and control frameworks; managing change effectively; and addressing climate change / net zero.
Our latest insights examine the risks and priorities across the key sectors in which our regulated clients operate, and the key areas in which regulated firms can expect engagement from the Central Bank in 2025:
- Central Bank Regulatory & Supervisory Outlook 2025: Banks, Payment and E-Money Firms, Retail Credit Firms, Investment Firms and Securities Markets
- Central Bank's Regulatory & Supervisory Outlook 2025: Funds Sector Impact
- Central Bank's Regulatory & Supervisory Outlook Report 2025 – Insurance
CONSUMER PROTECTION CODE
The final draft 'Conduct of Business' Regulations which will replace the Consumer Protection Code and incorporate, among other codes, the Code of Conduct on Mortgage Arrears are expected to be published by the end of Q1 2025 (having originally been signposted for publication towards the end of December 2024).
These will be accompanied by a Feedback Statement and final draft 'Standards for Business' Regulations (part of the Individual Accountability Framework). The Regulations will be signed into law shortly afterwards, with a 12-month transition period.
For more information, read our insights:
- Consumer Protection Code Reform: Central Bank launches 3-month consultation
- Individual Accountability Framework: Central Bank consults on Business Standards as part of CPC review
FINANCIAL SERVICES OMBUDSMAN
Amendments to the Financial Services and Pensions Ombudsman (Amendment) Bill will be considered at Dáil Committee Stage this month to address an issue that arose in early 2024.
The Ombudsman's view was that his remit doesn't extend to complaints regarding how a borrower's Standard Financial Statement under the Code of Conduct on Mortgage Arrears is dealt with / assessed by a credit servicing firm where the mortgage loan was sold between 2015 and 2019. The Ombudsman views that as being a 'key decision' and therefore one that rested (between 2015 and 2019) with the legal title holder (who did not require to be regulated by the Central Bank during that period) and not with the credit servicer (against whom the borrower lodged the complaint).
The Central Bank and Minister for Finance had previously confirmed that they were keen for this perceived legislative gap to be closed in a way which allows the Ombudsman's jurisdiction to cover this point.
FITNESS & PROBITY
In addition to the operationalisation of the Central Bank's new Fitness & Probity Unit (a key deliverable following the Enria Report) the Central Bank has confirmed that as part of its ongoing work to embed the recommendations in that Report, a new Fitness & Probity Assessment Approach will be published shortly, and a consultation will be launched on Guidance on Fitness & Probity Standards.
For more information, read our insights:
- Fitness and Probity: Central Bank announces establishment of dedicated Fitness and Probity Unit
- Fitness & Probity: Report published following independent review
LISTING ACT - PROSPECTUS REGULATION
The Department of Finance's consultation on Member State discretions under the Listing Act closes on 18 March 2025.
The consultation doesn't specifically address the discretion in relation to persons discharging managerial responsibilities under the EU Market Abuse Regulation i.e. whether it will adjust the new threshold of €20,000 to either increase it to €50,000 or reduce it to €10,000.
The consultation questions are instead specific to the EU Prospectus Regulation, and relate to the following:
- Question 1: Under the Listing Act, the Member State discretion to set an exemption threshold for public offers of securities anywhere between €1,000,000 and €8,000,000 will be replaced (the current Irish threshold is €5,000,000). There will be a principal threshold of €12,000,000 (calculated over 12 months) below which a public offer will be exempt from the obligation to publish a prospectus (if the offer doesn't need to be passported). Member States have discretion to reduce that threshold from €12,000,000 to €5,000,000. The Department is seeking views on this, but hasn't indicated whether it favours a €5,000,000 or a €12,000,000 threshold – it simply asks whether it should exercise the discretion to reduce the threshold to €5,000,000 from June 2026.
- Question 2: Whether, if the above exemption applies, an issuer should still be required to publish a prospectus summary. Again, there's no indication of the Department's preference on this.
- Question 3: Any views on other matters relevant to the transposition of the Listing Act Regulation.
Our insights on the Listing Act are here:
- Listing Act published in Official Journal: Update on changes to Prospectus and Market Abuse Regulations (debt securities)
- EU Prospectus Regulation: Listing Act changes relevant to debt capital markets
- EU Market Abuse Regulation: Listing Act changes relevant to debt capital markets
PAYMENTS
The Finance (Provision of Access to Cash Infrastructure) Bill has been reintroduced to Dáil Éireann in Q1 2025 now that a new Government is in place, and we expect it to progress quickly.
For more information on the Bill, and the related National Payments Strategy, read our insights here:
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.
