John Lahart (Dublin South West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

90. To ask the Minister for Finance if his Department has considered any of the implications of a television programme (details supplied); and if he will make a statement on the matter. [2192/17]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

There were a number of issues raised in the course of the interview referred to.

Firstly, on the issue of liquidity breaches at Unicredit Ireland in 2007, the Central Bank has informed me of the sequence of events and the actions of the Central Bank in relation to those breaches, which are as follows.

In August 2007, the Central Bank of Ireland was notified by Unicredit Ireland of an overnight breach of compliance with the then recently introduced Central Bank Requirements for the Management of Liquidity Risk. An inspection was undertaken by the Central Bank from 3-10 October 2007. Upon investigation, the Bank was satisfied that the breach did not suggest a wider or more systematic erosion of overall liquidity. The bank was back in compliance with the limits within twenty four hours of the breach. The breach was not connected to any other bank operating in Ireland.

Following additional claims made in the media in 2010 that numerous breaches had taken place in the months following the introduction of the Requirements in 2007, a further investigation was undertaken at the instruction of the Central Bank. An independent third party firm was engaged in order to check compliance with the liquidity requirements. This investigation did not highlight any further breaches.

The Central Bank also requested that any individual who had information they wished to share with the Central Bank regarding potential regulatory breaches, to write in confidence to the Public Contact Unit or the Deputy Governor, Financial Regulation. Following contact from a third party at that time, the Central Bank held a meeting with that person to discuss the matter.

The Central Bank has undertaken significant investigations around the issues raised and is satisfied that this matter is now closed.

On the issue of the Central Bank's approach to whistleblowers, new protections for persons making protected disclosures to the Central Bank came into force on 1 August 2013. This also included new obligations on certain categories of persons in regulated firms to disclose breaches of financial services legislation to the Central Bank. The Central Bank has established a whistleblower desk and put in place policies and procedures to ensure such disclosures are dealt with appropriately.

In broad terms, where a person makes a disclosure in good faith to the Central Bank or one of its employees, and the person making the disclosure has reasonable grounds for believing that the disclosure will show that there has been a breach of, or offence under, financial services legislation or the concealment or destruction of evidence relating to such an offence or breach and provides their name, the disclosure is a protected disclosure. Any correspondence received by the Central Bank through its protected disclosure channel is treated seriously and examined thoroughly.

Furthermore, the EU Regulation establishing the Single Supervisory Mechanism, which formally commenced on 4 November 2014, includes a provision in respect of reporting of breaches, i.e. whistleblower reports, which relate to those banks directly supervised by the European Central Bank. Persons with information on potential breaches of EU law by banks and/or by competent authorities, including the Central Bank of Ireland, can report such breaches to the ECB. 

Another issue which was raised in the interview was around attendance at the Banking Inquiry. The Joint Oireachtas Committee of Inquiry into the Banking Crisis was formally established in November 2014 under the Houses of the Oireachtas (Inquiries, Privileges and Procedures) Act 2013. The purpose of the Inquiry was to inquire into the reasons Ireland experienced a systemic banking crisis. It was a matter for the Joint Committee to decide on whom it would call as a witness or who would be consulted as part of the Inquiry. The Joint Committee's full report can be found via the link .

Finally, some opinions were expressed during the interview around AIB's solvency. I want to take this opportunity to reassure the House that AIB is now in a healthy financial position, generating good profitability and levels of capital. I've indicated many times before, that our strategy in recent years was to hold onto our investment in the bank until its value had recovered substantially from its lows to the point where it accurately reflected the true value of the franchise. Six years on from when the State last had to put capital into AIB, we are now at a point where funds have already started to come back to the taxpayer, and we see a genuine possibility of being able to sell a portion of our shareholding on the markets in the next 12-18 months.