Martin Ferris (Kerry North, Sinn Fein)
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Question 87: To ask the Minister for Finance if he is satisfied that the Financial Regulator has carried out its duties in respect of the regulation of Irish banks. [6714/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The importance of having a regulatory system that provides financial stability and fosters probity has become all the more clear to us now in a time of severe financial dislocation, both nationally and internationally. It is accepted that a new and better co-ordinated approach to ensuring financial stability and regulation is required, with a greater degree of focus on areas such as risk management, compliance, corporate governance and general control processes.

As the Deputy will appreciate, steps have already been taken in that regard in the Credit Institutions (Financial Support) Scheme and, as a result of this, the oversight of the banks concerned has been greatly intensified. This new regime provides for a heightened direct engagement with each of the covered institutions and new reporting arrangements including the provision of Scheme compliance certificates by the covered institutions themselves and by their external auditors. The Regulatory Authority is allocating additional resources to supervise the compliance by the covered institutions with the Scheme requirements and is now reporting to me on this on a regular basis.

The Bank Guarantee Scheme requirements and conditions are the first step in a new system of financial regulation and supervision. The joint Boards of the Central Bank and Irish Financial Services Regulatory Authority are considering further reform measures and I have just received a report in that regard. In addition, other regulatory considerations, both domestically and at an international level, are underway including the following:

The Regulatory Authority is reviewing its overall strategic regulatory approach with a view to ensuring that the Authority meets its statutory mandate and responds to EU developments in financial regulation;

The Financial Regulator Business Process Review, designed to improve its effectiveness and value for money, is now close to finalisation;

The Financial Regulator is also processing a strategic plan for 2009, which will address the particular EU and Guarantee Scheme requirements for 2009;

At EU level, new regulatory proposals, including improvements to the Capital Requirements Directive, are due for adoption in early 2009, and more generally;

At Ecofin Council, which will incorporate the work being carried out at a wider international level, the role and mandates of national regulators are now the subject of in depth consideration and arising from this it can be expected that proposals will be forthcoming on matters such as prudential soundness, the orderly functioning of markets and stronger European co-operation on financial stability oversight.

I propose to take account of the various reviews that are underway on regulatory reform. As Minister for Finance, I am responsible for the legislative framework within which the Financial Regulator operates. When I have considered the issues fully, I will bring my proposals for reform to Government.

Martin Ferris (Kerry North, Sinn Fein)
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Question 88: To ask the Minister for Finance if Anglo Irish Bank provided loans to State or semi-State bodies. [6715/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Anglo Irish Bank is being run on an arms length commercial basis. Accordingly, commercial decisions, which include decisions on lending, whether to private or public entities, are a matter for the Board of Anglo. Notwithstanding this, I am informed that Anglo has no direct lending on the Irish loan book to State or Semi-State bodies. As the Deputy will be aware, the Board of Anglo is preparing a comprehensive business plan which will be required to demonstrate how the Board will oversee the continued commercial operation of the bank in the best interests of the bank, its customers and the State.