Regulator beefs up supervisory team
Insolvency problems at Quinn Insurance and the collapse of lenders like Anglo Irish and Irish Nationwide have prompted the financial regulator to beef up its supervisory team.
Insurance regulatory staff numbers at the office will increase to 113 at the end of this year from 42 two years ago while a director of insurance supervision will also be appointed, Matthew Elderfield told members of the European Insurance Forum in Dublin’s RDS yesterday.
The office is also adding to its actuarial team.
Mr Elderfield said that he was “surprised” at the lack of focus on supervisory issues and risk assessment when he took over from previous regulator Pat Neary in 2009.
“We are working to address both of these issues,” he said.
Mr Elderfield added that tougher corporate governance is necessary in the banking sector including a greater emphasis on board meetings.
“More time should be set aside for more board meetings to facilitate more challenge of management, analysis of risks and reviews of strategy.”
He also reiterated his recommendation for the vetting of bankers and insurance executives before they take up senior roles in institutions following on from the financial crisis.
The vetting process would be based on the UK model called the approved persons regime.
“This is another exercise in closing a glaring gap in the regulatory framework in Ireland that applies across all sectors: the absence of a statutory framework for assessing the fitness and probity of individuals working in the financial sector,” he said.
“The framework will be familiar to many of you …..the approved persons regime.”
Under the system, individuals who carry out certain functions including deposit taking and insurance have to be vetted.
He told the forum that the insurance industry is still a thriving part of the Irish financial services sector, despite challenges.
There were 308 licensed insurance and reinsurance companies in Ireland writing up to €58bn gross premium in 2009.
However, he added that the international market is continuing to experience soft pricing conditions due to excess capacity.