Mr. Domhnall Cullinan:

We directed the company in April 2009 to establish an in-house actuarial function, which was not complied with until such time as the administrators were appointed. By way of reassurance, however, all of the other major high-impact companies operating now in the country have in-house actuarial resources. Throughout the noughties, the actuarial resources available to the Central Bank varied between zero and two, and they were almost exclusively devoted towards the development of the Solvency II directive, which is coming from Europe and is probably the biggest piece of legislation ever in the insurance arena.

Outsourcing was not an option for us. The Insurance Act 1989, under section 60, provides for the appointment of authorised officers. It was only through appointing an authorised officer that we could go in and conduct the level of investigation that would be required in order to carry out a reserving exercise of the type that EMB undertook. It was not until the Central Bank Reform Act 2010 that the Act was amended to allow us to appoint third parties. Outsourcing the function and getting the capability from outside the Central Bank was not an option.