IFSC institutions and other wholesale international banks operating in Ireland will call on the Financial Regulator to waive new corporate governance requirements for wholly-owned subsidiaries whose parent operations have equivalent requirements in another country.
The wholesale banks are also accusing the regulator of failing to meet basic standards of "necessary, targeted, transparent and proportionate" regulation, according to briefing documents seen by the Sunday Tribune.
The demands will come this week in a consultation submission to the regulator by the Federation of International Banks in Ireland (FIBI), which represents multinational wholesale banks in Ireland. "The principles of better regulation dictate that any regulation be necessary, targeted, transparent, and proportionate. These hurdles have not been met. Without a regulatory impact assessment being presented it has not been demonstrated that the benefits of the proposals being applied to subsidiary institutions outweigh their costs," the documents said.
The Financial Regulator is seeking input on a whole range of new corporate governance measures affecting a broad range of financial institutions operating in Ireland, including IFSC banks which have no domestic market profile. FIBI is arguing the regulator should recognise other corporate governance regimes that these banks operate under and grant them derogations from Irish requirements.
It said the regulator's consultation paper has not provided enough detail on what the proportionate requirements are for the many smaller institutions which are wholly-owned subsidiaries of larger groups. FIBI said the regulator should not require all institutions to have high levels of independence on their boards, since this would mean a loss of control for their group owners.