The Irish Financial Services Regulatory Authority (IFSRA) is preparing to charge financial institutions, insurance companies and other businesses it regulates €19.6 million this year to part-fund its supervisory activities.
IFSRA announced yesterday that credit institutions will have to pay €6 million towards its costs. Insurance undertakings will contribute €3.8 million while intermediary firms (brokers) will pay €2.65 million. The estimated cost of IFSRA's activities is €38.5 million.
The regulator said that it intends to raise approximately 50 per cent funding from industry in 2005 and 2006. It has agreed to cap funding for the industry at those levels for the next two years.
Security and investment firms will pay just over €2 million to IFSRA this year, Collective Investment Schemes, which are administered at Dublin's International Financial Services Centre, will be invoiced for €3.7 million, while credit unions will have to pay €1 million.
Moneylenders will be asked to pay €125,000 to IFSRA in 2004, approved professional bodies will pay €80,000, while Bureaux de Change will pay €20,000.
In a statement, IFSRA said it sees the raising of funding from the industry as an important part of the new regulatory framework.
Speaking to the Irish Insurance Federation (IIF) yesterday, IFSRA chief executive Mr Liam O'Reilly said it planned to issue regulations at the end of June and invoices will be dispatched in July.
IFSRA consulted those funding the regulator and noted that the dominant theme during that process was their concern for value for money. Mr O'Reilly reassured them that IFSRA will be subject to value-for-money audits by the Comptroller and Auditor General.
"As a new organisation, we have indicated that our strategy is an emerging one and that we will, over the coming period, develop increasingly more robust indicators of performance."
He told IIF members that all financial institutions value working in a well-regulated environment. Regulation that is "too light" or non-existent, he said, leads to reputation questions, which can be a competitive disadvantage.
IFSRA believes that placing responsibility on boards and top management who are expected to be competent, conscious of risks and are responsible for inculcating a culture of probity throughout their organisations, works best.
