'I am deeply saddened by Brexit' - Central Bank's Ed Sibley
Central Bank deputy governor Ed Sibley has the air of a man comfortable in his own skin - and in his own job - as he glides through the serene corridors of the Central Bank's plush new docklands headquarters.
An air of calm isn't a bad characteristic in a financial regulator, especially with the Brexit storm about to hit.
Even before that, the upper echelons of the Central Bank have been going through their own more contained period of instability. Governor Philip Lane is leaving in May, if all goes to plan, to take up the senior role of European Central Bank chief economist in Frankfurt. That followed a year of fairly intense politicking by Finance Minister Paschal Donohoe. Sibley's peer as deputy governor, Sharon Donnery, was pipped late last year for the top job at Europe's Single Supervisory Mechanism (SSM) and is understood to be considering a run at Lane's soon-to-be vacant seat.
There's a lot going on in the rooms off those corridors.
But the Englishman is happy to take himself out of any speculation.
"There's still a little bit of process to go through in terms of the Governor's appointment, assuming that all goes OK and I'm sure we'll find out later this month. Then, yes, you are right, there will be a vacancy here.
"I'm not interested in it. I'm genuinely committed to the role I have here, I hope to be in this role for a long time, I have a five-year contract (and) it can be rolled over for another five years if whoever the new Governor is likes the cut of my jib, and we haven't had a large failure on my watch.
"I would like to continue to do it for the long-term and the governor role isn't for me," he says.
The point could hardly be made any clearer. It leaves Sibley to face into the greater uncertainties and challenges thrown up by his home country of the UK's impending exit from the EU. He reckons the risk of a hard Brexit is underpriced by the markets, but is satisfied the Irish financial system is now resilient enough to withstand the shock.
To date, the most obvious fallout from Brexit for the Central Bank has been the migration of some London-based financial services business to Dublin.
It's a boost to the Irish economy, although Sibley is firm in his view that the real fallout for Brexit will be economic damage to Ireland, not gains.
Even so, a slew of firms have pitched up seeking Irish authorisation. One UK-based think tank even claimed Ireland had been the main winner of this so-called Brexodus, based on the number of firms moving.
So what will the final breakdown be, I ask? "We'll see at least two phases to it. We are a long way through the first phase, which, as we probably talked about, is more than a hundred applications either as fresh authorisations, or changes, or extensions to existing authorisations."
However, it ranges from firms with fewer than a handful of employees to banks and insurers shifting hundreds of jobs here, Sibley says. None has involved really big job numbers, comparable to a Facebook or an Apple.
In fact, most of the firms coming will have little to do with the Irish economy.
"The majority of firms that are coming as a result of Brexit are coming to continue to serve EU clients post-Brexit. So by their very nature they are most likely to be exporting financial services, rather than serving the domestic economy," he says.
Insurance will be a bit different, but overall what the Central Bank has seen fits with what is already in the IFSC.
"A lot of it we are used to and familiar with, but there is more complexity coming in. Again, if we talk about the banking side and the investment firms, we are seeing more investment banking activity. We've had pieces of that before but not to the same extent that we have now."
As a regulator the Central Bank is ready for it, he said.
"We've skilled up. We've got some support in terms of training and from consultants, we've recruited and we've used the expertise we have."
That also means being able to draw from teams across Europe under the ECB umbrella, he said.
"So, it's not solely what we have here, we're part of the senior supervisory mechanism, we're part of banking - overall banking supervision across the eurozone - and we work very closely with our colleagues in the ECB. So, whether a firm is situated in Frankfurt, or Paris, or Dublin, the supervision is the same. The skill set we have, we can draw on from the sense of the learning and methodologies we follow - there is a good deal of consistency."
Even so, the deluge of applications from firms and executives seeking Central Bank authorisation to operate here has stretched capacity at the regulator.
"It's not without its challenges. Overall, the Central Bank has done a really good job on Brexit - authorisation is only one aspect of that. But we've had to make some hard choices in order to do that - in terms of prioritising Brexit over other work that we might have done."
Sibley accepts that this decision brings with it a risk that problems will be missed elsewhere in the system, but thinks things like less-frequent or extensive engagement than normal with some regulated entities was a choice that had to be made.
"That's all been done in a very conscious way, not entirely without risk, but in a conscious way - weighing up the resource demand the risks associated with Brexit relative to some other risks and prioritised Brexit. We have finite resources both in terms of numbers and skills sets so, you know, you have to make those choices."
Brexit necessarily dominates our conversations, as we move into the end game in what could yet be a very messy British exit from the EU.
As an Englishman settled here - Sibley's wife and children are Irish, he describes himself as at home here, and he has no plans to ever leave the country - it's an extraordinary time.
What does he make of it all?
"I have to be slightly careful. From a post perspective I'm apolitical, although it can be difficult to talk about Brexit and the politics of Brexit and maintain that stance," he says.
"Personally, I am deeply saddened by it. I think it is entirely regrettable - albeit understandable in some respects. I think it is to the detriment of the UK and to the detriment of the EU and it's really unfortunate that Ireland is going to suffer collateral damage as a result," he says.
As financial regulator, Brexit is just one of many challenges that face Irish financial institutions and their customers. Cyberattacks are a particular concern for Sibley "because the burn is so fast" and firms are vulnerable in part as a legacy of underinvestment during the financial convulsions that followed the crash.
The tracker mortgage scandal and the redress process that is still going on has also been a huge undertaking for the wider Central Bank.
Derville Rowland - the Central Bank's director general for financial conduct - has the lead role in the current probe, but, as regulator, Sibley's job will be to ensure lessons are learned to prevent a repeat.
The Central Bank is all over the consumer protection aspect of the scandal now. However, in 2012, when Sibley joined the bank, the concern for regulators was the damage tracker deals posed to lenders. I put it to him that that attitude - the characterising of trackers as a problem for the system - might have given some bankers the nod for what we now know became a €1bn scandal.
Has the regulator examined its own role in this, I ask?
"I came back to Ireland in 2012 - there were discussions about trackers, but it was more about what could be done from a wider bank perspective. Were there options in term of moving trackers - having trackers in a different form away from the banks. There was never any conversation about moving individuals off trackers," he says.
In fact, he says it was the regulator's own 2008 and 2009 consumer protection actions that provided the tools now used to extract redress.
But does he think the then attitude of the regulator had an impact on how the banks went on to misbehave?
"I genuinely don't and even if it were the case, I don't think it would be any excuse for the behaviours that we've seen," he says.
"The fault for that lies with the banks. We have been very consistent in making sure that customers to the greatest extent possible are put right, recognising that financial compensation doesn't address all the emotional hurt and difficulties that some people have experienced through the mistreatment by the banks."
Legislation is wending its way through the Oireachtas that in future will make individuals directly legally responsible if wrongdoing occurs.
Meanwhile, the Central Bank is pushing a cultural shift within firms as the other cornerstone to contain the risk of future wrongdoing, including nudging firms for greater diversity and inclusiveness at the higher levels within organisations as a guard against groupthink.
The Central Bank itself was slow to tackle the tracker-overcharging scandal, which individual borrowers forced through the courts and was a major issue in the media before it was really accepted as a major scandal.
However, Sibley doesn't accept that having consumer protection and financial regulation functions under a single roof at the Central Bank means it is less able or willing to take on banks.
"Personally, I think probably the most important aspect of my role is the consumer protection role. The bulk of what we do in prudential supervision is aimed, certainly when we talk about the domestic market, at protecting consumers both here, and when you talk about the international firms, abroad," he says.
"So I would see them as being entirely complementary."
He isn't naive to the fact that a shift in language and tone by lenders represents a definitive break with the sometimes more obviously grasping policies of the past.
He cites, as an example, the fact that many banks charge existing customers more than new borrowers in mortgage interest, for example.
"When I hear banks talk about putting their customer first and all this kind of management speak about their customers and then I see that they have put a percentage point or more between back book [existing customers] and front book [new borrowers] I'm very sceptical."
However, the solution he suggests - that more mortgage customers switch - suggests he's happy to push the onus to police such behaviour onto the public, rather than intervene himself.
The high cost of borrowing here goes well beyond that however. ECB President Mario Draghi recently told the Oireachtas that high prices here were the result of a "quasi-monopoly". Was he right, I ask?
There's no simple answer to this one, it seems. "There is certainly still dysfunction in the mortgage market in Ireland and if one thinks about what one would expect a functioning mortgage market to do - we would expect there to be risk-based lending - pricing according to risk to be present, good amount of choice, a relatively high degree of market discipline and clear contracts, strong consumer protection and a degree of stability and certainty about the legal system," he says.
More than a decade after the crash, Sibley says there are still problems with every aspect of that, though they're getting smaller.
One of those issues is the difficulty of repossessing houses even when the mortgage hasn't been paid for year. Knowing he's in a minefield, the regulator picks his way through this one with more than his customary caution.
"Ultimately that's a choice that the country makes. Relative to other jurisdictions it does take a long time to effect security in Ireland and in some cases it's very, very difficult," he says.
Other countries, he notes don't report statistics for two, three, four or five-year arrears, because that simply doesn't arise.
"I am living in Ireland, I will live in Ireland for the rest of my days, but certainly my experience from the UK is if you stop paying your mortgage you'll lose your home, and it's relatively quick," he says.
Even so, he says he sees the positive side to the Irish post-crash experience.
"So there clearly are some elements there that affect how one thinks about security in Ireland, but I would also say if you look at how mortgage arrears have been dealt with in Ireland the vast, vast majority has been dealt with through engaging, giving people time to recover from whatever shock has hit them, restructuring where it makes sense to do so and so on.
"So if we look at the numbers and I am always conscious... behind each number there is a person, but at a broad level we have over 100,000 restructured owner-occupier mortgages in the system. Since 2009, really from the onset of the crisis, there's been in the order of about 9,000 cases of loss of ownership and about two-thirds of those have been through the handing back of the keys, the voluntary surrender of voluntary sale," he says, rattling through the numbers with impressive fluency.
"So only - I use that word advisedly - but about 3,000 have been repossession through the court process. For those borrowers that have engaged and continued to try and engage to do the right thing, to make sacrifices, they have been met with a willingness to restructure and if that hasn't been the case there are other avenues, structures, supports within the State that go beyond a lot of other jurisdictions."