The Central Bank is likely to retain a significant role in the regulation of financial services under a recommendation expected to be made to the Government by the committee currently studying the issue.

The Irish Times understands that an agency or division under the direct control of the Central Bank will be assigned to specifically monitor consumer issues in the sector. The Central Bank will retain its normal role of ensuring the solvency of financial institutions.

No member of the committee was available for comment yesterday, but other sources said the Central Bank had outlined several difficulties in setting up a standalone regulator. The unions representing staff at the Central Bank also made strong representations against an entirely independent body.

The committee is due to meet again today to try and agree a final report scheduled to be presented to the Tanaiste, Ms Harney, and the Minister for Finance, Mr McCreevy.

The meeting today is expected to discuss the budget to be set aside for the new division and whether consumer representatives will be involved.