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Financial Regulator interviewing bank board appointees
15.04.2010
Categories:
Leadership
The Financial Regulator has promised to clean up Ireland’s financial system with the proper enforcement of tough new rules, which include limiting the number of directorships that can be held by bank board members.
Speaking before the Oireachtas Joint Committee on Economic Regulatory Affairs yesterday, the Financial Regulator Matthew Elderfield said there had been serious failures in corporate governance at financial institutions.
Elderfield said he would shortly be publishing new proposals to set “more exacting standards” for the boards of banks and insurers.
The Regulator also said that his office was now interviewing new bank board directors to see if they were suitable for the job.
“We’re not just going to check whether you’ve got a criminal background; we’re going to check if you’re up to doing this particular role and you have got the experience. We’re going to interview you and ask you about regulation,culture and risk management.”
Elderfield also said the Irish banking system became fundamentally flawed with lenders chasing “unsustainable profits” through risky property and development lending.
The era of low mortgage rates in Ireland was “now clearly ending”, the Regulator said. He explained to the committee that the reason the banks had been able to offer such low mortgage rates was because the profits they earned through risky property and development lending had effectively subsidised their cheap mortgage lending.
Categories:
Leadership