Ireland: Financial System Stability Assessment

Ireland: Financial System Stability Assessment
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Volume/Issue: Volume 2022 Issue 215
Publication date: July 2022
ISBN: 9798400213564
$20.00
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Topics covered in this book

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Banks and Banking , Finance , Money and Monetary Policy , International - Economics , Business and Financial , insurance sector liquidity risk analysis , G , insurance sector solvency , MBF sector , banking sector Stress Testing Matrix , C , banking sector solvency , Commercial banks , Financial Sector Assessment Program , Foreign banks , Insurance companies , Global , Europe

Summary

This Financial System Stability Assessment paper highlights that the Irish financial system has grown rapidly and in complexity, especially after Brexit, and Ireland has become a European base for large financial groups. Risks to financial stability emanate from a much larger and more complex financial system, persistent legacy issues, as well as emergent ones from non-bank lending, Fintech, and climate change. Stress tests confirmed banks’ resilience to severe macrofinancial shocks, with some caveats. While broadly adequate, supervisory resources and capacity need to keep pace with a growing and more complex sector with significant cross-border linkages. Efforts are needed to further strengthen supervision of banks’ credit risk and develop capacity and skills on new areas such as climate, non-bank lending, and Fintech. Insurance oversight should prioritize intra-group complexities. Resolution and crisis management can be enhanced through greater planning and collaboration between the Central Bank and the Department of Finance to bolster the ability to deal effectively with institution failures and systemic crises.