Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Question 103: To ask the Minister for Finance if he has issued any policy directions to the Financial Services Regulatory Authority since the banking crisis broke; and if he will make a statement on the matter. [37709/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The Deputy may wish to note that, under the terms of the Central Bank Act 1942, as amended, the Irish Financial Services Regulatory Authority is responsible for the regulation and supervision of the financial system including the banking sector. In the exercise of its regulatory and supervisory functions under statute, the Regulatory Authority acts independently of the Minister of Finance. This independence is an essential pre-requisite for the proper exercise of these functions and is firmly in accordance with standards of international best practice. In my role as Minister for Finance, therefore, I have no legal authority nor would it be appropriate for me to issue policy directions to the Authority.

As the Deputy will be aware the system of financial regulation in Ireland is based on a detailed and comprehensive EU template and many of the functions and powers assigned to the Regulatory Authority are assigned under EU law. As Minister for Finance, I do not have the authority to issue directions on matters covered by European law.

Of course as a matter of routine, my Department liaises closely on an ongoing basis with the Financial Regulator on matters relating to the legislative and policy framework for financial regulation. This reflects the expert advisory role played by the Financial Regulator in relation to the development of legislative proposals both at national and EU level. Since the onset of the financial crisis all the public authorities have worked closely advising the Government on key elements of the Government's response – the Guarantee Scheme, the recapitalisation of the banks and NAMA. This has helped ensure a cohesive and co-ordinated national response to maintaining financial stability in Ireland and ensuring that the financial system is restored to health to support economic recovery.