Effective and efficient regulation and supervision are among the most important contributors we can make to stability, resilience and confidence in the financial system – Central Bank of Ireland hosts fourth annual Financial System Conference

The Central Bank of Ireland today (25 November) hosts its fourth annual Financial System Conference. The conference brings together domestic and international industry leaders, consumer representatives and policymakers to discuss key issues impacting the financial system.

Speaking at the conference, Governor Gabriel Makhlouf said the work of central banks and regulators matters now more than ever in a changing, fragmented world, to deliver monetary and financial stability and ensure the financial system continues to operate in the best interests of consumers and the wider economy.

He said: “Effective and efficient regulation and supervision are among the most important contributors we can make to stability, resilience and confidence in the financial system. The experience of the past years has reinforced my view that a strong regulatory system does not depend on the number of rules, but on the quality of those rules, the fairness of their application, and the confidence they inspire.

“This year, the world of financial regulation has been buzzing with phrases such as deregulation, de-supervision, modernisation and simplification. My preference is continuing to focus on being forward-looking, connected, proportionate, predictable, transparent and agile, or, to put it another way, regulating and supervising well.

“Regulating well is not about loosening standards or dismantling the architecture that protects consumers and ensures financial stability. It is about making sure that what we do is clear, consistent and coherent, so that rules are understood, applied predictably, and achieve their purpose without unnecessary burden or complexity.”

On the next phase of the Central Bank’s evolution, Governor Makhlouf said, “Over recent years, we have streamlined and strengthened our supervision, authorisation and engagement processes. We have introduced a new supervisory approach which remains risk-based and outcomes focused but is more integrated across the Bank.

“We have improved our external-facing processes including authorisations, making them more transparent, consistent and predictable. The outcomes we have achieved in our first Innovation Sandbox programme also represent a new model for innovation engagement, where collaboration with industry accelerates safe innovation.

“The way we make policy has evolved. The mortgage measures are a good example of regulation that learns in practice and shows how we evaluate and refine frameworks over time, drawing on data, evidence and experience to maintain both resilience and access to sustainable lending.

Governor Makhlouf acknowledged the work the Central Bank is doing at a European level, noting that high quality regulation depends on coherence between domestic and European frameworks. He said, “We are reviewing frameworks to ensure alignment with evolving EU law, coherence across domestic regimes, and proportionality in application.  We expect, for instance, that our existing anti-money laundering framework will mostly be replaced by new EU Regulations. 

“As we have brought in new regulations domestically, we are also reviewing our existing ones. For example, we are going to review the corporate governance requirements in 2026 to remove duplication, improve alignment across sectors, and embed proportionality and clarity into governance design.”

Governor Makhlouf said, “What matters to me most is the discipline behind these projects: to review what we have built, to align with best practice while meeting domestic needs, and to ensure that rules continue to serve their purpose, while we remain focused on doing our job.”

Governor Makhlouf made it clear that there should be no confusion of efforts to make better policy and improve processes with a weakening of the Bank’s approach to regulation and supervision. “The standards we expect of regulated firms won’t be lowered. We will not dial back our supervision. We will continue to take enforcement action where necessary. And if changes to the risk landscape mean we have to introduce new rules or requirements, we will do so.”

Over the coming weeks, the Central Bank will publish a list of ongoing initiatives to make the domestic regulatory framework more straightforward, including consulting on a new Regulatory Impact Assessment Framework next year. The Central Bank will also continue to actively engage with others on how to streamline the European rulebook to strengthen the Single Market.

Governor Makhlouf said, “A commitment to regulating well and being more straightforward does not mean a commitment to no new regulation; rather it means ensuring that each new measure is well-designed, well-justified, and well-understood. Regulating well and supervising well ultimately means ensuring clarity of purpose, coherence of process and consistency of principle.

“Robust, efficient and effective regulation and supervision is not a luxury; it is a necessity and one of the most important ways we can contribute to resilience at home and confidence abroad. If we continue to challenge ourselves, be humble about the value of learning continuously, and evolve our frameworks in a disciplined way, then I am confident that the financial system will continue to work well, whatever the external environment throws at us.”

ENDS

Further information:

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[email protected]

Notes to Editors

• The Governor’s full opening remarks can be read here