Central Bank targets eight high-level goals in strategic two-year plan

The Central Bank has issued its strategic plan for the three years from 2013-2015 which includes eight high- level goals aimed at safeguarding financial stability and protecting consumers.

“The strategic plan is set in the context of continuing financial stability concerns and challenges to Government finances, difficult economic conditions for consumers, businesses and regulated firms and increasingly international policymaking environment,” the bank said.

The Central Bank has come in for a lot of criticism in the wake of the financial crisis over the past few years, particularly its lack of intervention when the domestic banks were building up huge exposures to the property sector.

Much of the regulatory shortcoming has been attributed to the split responsibilities between the Central Bank and the Financial Regulator for overseeing the banks. Since Patrick Honohan was appointed governor in 2009, there has been a radical overhaul of the bank.

The eight high-level goals for the next three years cover all aspects of the bank’s responsibilities.

Not surprisingly, its relationship with the ECB tops the list. The Central Bank says it will continue to help the governor in performing his role in relation to ECB monetary policy formulation and crisis resolution. “The bank will continue to implement both standard and non-standard monetary policies and operations on a decentralised basis.”

The stability of the financial system will also be a core objective. This includes building up data analytics and loan-loss forecasting capability for the banks based in this country.

There will be a comprehensive regulatory framework in place for financial institutions and the markets through an assertive risk-based supervision “which is underpinned by credible enforcement deterrents”.

Resolution of financial difficulties across the banks and the credit unions will be a key feature of future strategy and this includes proper stress testing to ensure that they fufil their capital adequacy requirements.

Protection of consumers of financial services is among the goals. This will include measures to strengthen protection for consumers.

The Central Bank aims to increase the relevance and quality of the analysis, research and financial statistics it compiles for the media, the public and the markets.

The Dame St institution will continue to lead the development of the National Payments Plan.

And lastly, “efficiency and cost-effectiveness will underpin all our operations. The bank will strive to have the people, systems and structures in place to maximise our effectiveness. Cost control within our own operations and ensuring the optimum return on the bank’s investment portfolio will be key considerations in our financial and planning processes.”