Jack Chambers (Dublin West, Fianna Fail)
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81. To ask the Minister for Finance the process required for an international bank to acquire a licence to operate here; the length of time the process takes; if consideration has been given to speeding up this process and creating a shorter waiting time than is in place in other jurisdictions to attract more foreign direct investment; and if he will make a statement on the matter. [33920/16]

Michael Noonan (Limerick City, Fine Gael)
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The Central Bank operates as part of a European system of regulation and standards. The authorisation process is broadly consistent across the European Union and entirely consistent within the eurozone. Post 'Banking Union', the European Central Bank ('ECB') is the competent authority in Ireland for the granting of banking licences in accordance with Section 9 of the Central Bank Act, 1971 (as amended). The Central Bank has published Guidelines on its website to assist those wishing to submit an application for a Banking Licence under Section 9 of the Central Bank Act 1971.

The principal stages in the authorisation process are as follows:

- Exploratory Phase - During this phase the potential applicant will submit a proposal to the Central Bank for review. The Central Bank will undertake a detailed review of the proposal and issue comments advising the applicant of any further information or clarifications required in relation to any aspect of the proposal. The purpose of the review is to determine whether the proposal will meet the required standard for authorisation. The Central Bank will, having conducted an initial assessment, notify the ECB of receipt of the proposal and provide all required information to enable it to commence its assessment of the proposal;

- Formal Application - Should the proposal meet the required standard, the applicant will then submit an application for authorisation. Both the Central Bank and the ECB will complete their assessment of the application which may involve further clarification being sought from the applicant. At the end of this stage the Central Bank will determine whether to recommend to the ECB that authorisation be granted;

- ECB Decision - Decision by the ECB on whether to grant a banking licence - A banking licence will only be granted where the ECB and the Central Bank are satisfied that the applicant complies with the authorisation requirements. The robustness of the discharging of our gatekeeping role is critical to the protection of consumers and maintenance of financial stability.

In relation to applications for authorisation under Section 9A of the Central Bank Act, 1971, referred to as 'Third Country Branches' (i.e. where the applicant is a credit institution whose head office is located in a state or territory other than an EEA state and which holds an authorisation to carry on banking business in that state or territory from the authority that exercises in that state or territory functions corresponding to those of ), the Central Bank is the competent authority for granting such authorisations.

The principal stages are the same as for section 9 authorisations, set out above, with the exception that there is no ECB involvement in the assessment and the decision on authorisation is made solely by the Central Bank. The Central Bank has published a Policy Statement on the authorisation of Third Country Branches.

The total time for licensing will depend upon:

- the quality of the proposal submitted by the applicant;

- the nature, scale and complexity of the proposed business model;

- the time taken by the applicant to respond to comments raised on each draft of the proposal and application;

- the quality of the responses received addressing all issues raised;

- any changes made by the applicant to its proposal during the authorisation process; and

- the time taken by any relevant third parties to respond to queries in relation to the application.

The Central Bank has informed me that once a full, completed application is received and accepted, the assessment process is commenced without delay but in practice, the authorisation process takes many months of engagement, discussion and back and forth on key issues before the application is completed. So measuring on this basis we can expect a time horizon of probably at least a year.

When it comes to applications for licences in Ireland, the Central Bank assures me that it stands ready to meet the challenges that may arise. The Central Bank will do so on the basis of an active, open stance, ready to engage, but in line with their duty to protect consumers, and in keeping with EU rules, international standards, and our published processes.