Introduction to Credit Institution Prudential Supervision 

The Central Bank of Ireland has overall responsibility for the authorisation, regulation and supervision of Credit Institutions operating in Ireland.  Credit Institutions regulated by the Central Bank of Ireland include:

  • Banks
  • Building Societies  
  • Designated Credit Institutions  

A current list of these entities is available on our registers page.

In addition the Central Bank of Ireland is responsible for oversight of liquidity and conduct of business for branches of non-Irish licensed banks operating in Ireland.

The objectives in supervising Credit Institutions are:

  • to foster a stable banking system;
  • to provide a degree of protection to depositors with individual credit institutions

As set out in the Central Bank Act 1942 (as amended) the Bank shall perform its functions and exercise its powers in a way that is consistent with- 

  • the orderly and proper functioning of financial markets,
  • the prudential supervision of providers of financial services, and 
  • the public interest and the interest of consumers.  

 In relation to the prudential supervision of providers of financial services the Central Bank of Ireland operates a risk based approach to supervision. In 2011 the Central Bank of Ireland introduced a new framework for the supervision of regulated firms called Probability Risk and Impact System (PRISM) to provide a structured framework for credit institution supervision (mores details on PRISM can be found on our PRISM page).  PRISM enhances the Central Bank of Ireland’s ability to deliver judgment-based, outcome-focused regulation.  It provides a tool for supervisors to continually challenge themselves and their firms in order to safeguard financial stability and to protect consumers.  

Within the Central Bank of Ireland the prudential supervision of credit institutions falls within the Credit Institutions and Insurance Supervision Directorate, and is is carried out by two Divisions:

  • Banking Supervision Covered Banks
  • Banking Supervision International Banks

 While the overall objectives and responsibilities of Banking Supervision are common for both divisions the structure reflects the diverse nature of credit institutions in Ireland. In addition to front line supervisors the Banking Supervision Divisions share various support units e.g. Risk Analytics, Business Model Analytics, Treasury specialists, Credit specialists and Policy, Reporting and Operations units.