SPEAKING following the appearance of representatives from the Central Bank of Ireland’s Financial Regulation Division before the Oireachtas Committee on Finance today (Wednesday), Fine Gael Cork North West Deputy, Michael Creed, said the Ulster Bank debacle raises serious questions for the Central Bank in terms of the regulation of our banking sector’s IT systems.
“By all accounts, there is a lack of capacity within the Central Bank to regulate our banks’ IT systems. In the past, Ireland has suffered dearly as a result of light touch regulation, which cost the taxpayer €64 billion. Now, it appears we are suffering a chronic case of no touch regulation where the monitoring of our banks’ IT systems is concerned.
“There are currently no inspections of banks’ IT systems carried out by the Central Bank, making them followers of the game rather than the main players, as should be the case. The saga with Ulster Bank has seen its customers seriously inconvenienced, not knowing where they stand in terms of their finances.
“In recent days, much of the commentary surrounding the previous weeks’ events, as far as the unaffected banks are concerned, has been; ‘there but for the grace of God….’. This suggests that a technical glitch could have happened to any one of them.
“There is now a pressing need for a review of the regulatory system, as far as the banks’ IT systems are concerned, as we move towards increased use of online banking and fewer cash transaction taking place.
“A banking regulatory system that was not up to scratch, bore a heavy load on the Irish taxpayer once before. We cannot afford to let that happen again. We must ensure that banks’ customers have absolute confidence in how they operate and that adequate contingency plans are in place when things veer off-course.
“None of the officials who attended the Finance Committee today were IT experts, with the result that TDs and Senators were instructed to direct technical questions towards Ulster Bank representative attending at the Committee tomorrow. This begs the question as to whether or not an appropriate skills mix is in place at the Bank and if not, why not?”