Central Bank sets out regulatory and supervisory priorities for 2023

The Central Bank Deputy Governors Derville Rowland and Sharon Donnery addressed the 2023 regulatory and supervisory priorities during an event held by the Institute of Banking. This discussion built on a previous priorities letter issued to regulated firms.
Donnery emphasized the challenging macro-financial environment and the need for effective regulation and supervision. The focus will be on maintaining resilience within the financial system and addressing the needs of the economy and society.
Rowland discussed the importance of mitigating risks to consumers and investors in the evolving economic landscape. Firms must adapt their risk management and compliance frameworks to protect investors and maintain orderly markets. In addition, reference is made to the Consumer Protection Outlook Report and the Securities Markets Risk Outlook Report, which highlight the importance of financial firms and market participants recognizing and adapting to new market conditions. They must adjust their risk management and compliance frameworks to protect investors and promote orderly markets.
Core areas of focus include:
– Assessing and managing firms‘ financial and operational resilience.
– Enhancing regulatory and supervisory approaches in response to a changing financial system.
– Ensuring a transparent authorization process through engagement with stakeholders.
– Addressing systemic risks from non-banks by advancing a macro-prudential framework.
– Overseeing the Irish banking sector’s consolidation and account migration.
– Supervising firms‘ support for borrowers in managing current economic challenges.
– Reviewing the Consumer Protection Code and the Individual Accountability Framework to enhance governance.
– Supervising firms‘ compliance with AML/CFT obligations and enforcing financial sanctions in collaboration with relevant authorities.
– Implementing new EU regulations on digital operational resilience (DORA) and markets in crypto assets (MiCA), as well as contributing to other regulations like Payment Services Directive (PSD2) review.
– Strengthening the financial system’s resilience to climate change risks and supporting a climate-neutral economy, while implementing the Sustainable Finance Disclosures Regulation.
These priorities align with the Central Bank’s vision of a resilient and trustworthy financial system that serves the economy and customers with fairness and high standards.