Lane warns banks and firms to prepare for fiscal shocks
Central Bank Governor Professor Philip Lane has appealed directly to leaders of companies and banks to ensure that their business plans are robust enough to withstand a financial shock.
Launching the bank's annual report, Prof Lane suggested his calls for fiscal discipline were not simply confined to State spending.
"I'm also signalling more widely in terms of how individuals make decisions, how corporates make decisions, how banks make decisions," he said.
"Yes, we have greater than expected growth numbers this year and next year but there are a lot of downside risks. In terms of risk management, the legacy of the private sector debts and the sovereign debts are so high, plans should be robust to disappointing news."
The Central Bank said it generated a profit of €2.24bn for 2015, a rise on last year's figure. From this, €1.79bn has been transferred to the exchequer. "The interest income and realised capital gains on the so-called special portfolio acquired as a result of the liquidation of IBRC are the main contributory factors to the high current profit levels," Prof Lane added.
He also said that the bank's staff will increase on a net basis this year by 150 to 1,700. The move to the new headquarters on North Wall Quay will begin later in the year, and the project remains within budget.