of the regulatory framework is maintained. of course when it comes to criminal matters, investigation and prosecution of most of these are the responsibility of the garda siochana to whom we pass relevant information. regulating the nonbank sector while, of all the central bank ’ s activities, banking attracts the lions - share of media coverage and public debate, and not surprisingly considering events of recent years, in actual fact, of the central bank staff working in financial regulation and supervision, only a fraction work on banks. the largest group supervise regulated non - bank entities operating in the financial markets notably including investment funds, for which dublin is one of the global centres. insurance firms, many of them providing services mainly to international customers, are supervised by another large group. the supervision of insurance firms and funds call for different approaches to that adopted for banks, and in both areas extensive and complex legislation has recently been introduced in europe and worldwide. the goals of this legislation are clear and simple – for example to ensure that insurance companies are adequately reserved for the risks they ensure, and that they do not have an incentive to assume risks being shed by banks, and to ensure that investment funds state clearly to investors what they are getting into and are not subverted in the interests of the promoters at the expense of investors – but their application is far from simple. indeed, many observers begin to worry that the new legislation – the number of new eu regulations or directives are being brought into effect in just a few years can certainly not be counted on the fingers of both hands – has grown to become too complex to achieve its goals or even to be fully digested by regulator or regulated. this has created a challenge for us as an international financial centre, but it is one which we are rising to. for example, we have recently pioneered an approach that will regulate funds that seek to originate loans ( as distinct from those which buy and sell pre - existing financial assets ), thereby providing protection to the investors in such funds – shadow banks being brought out of the shadows, as one might say. bis central bankers ’ speeches advising the government despite its operational independence from government, the central bank is part of the state ’ s administrative apparatus and one of its statutory goals is to provide economic analysis and comment. what kind of economic advice is the bank providing to government at present? with the lead in to the budget of course we are emphasising the importance of avoiding the mistake made in years gone by to assume as permanent revenue sources that are volatile

patrick honohan : central banking boundaries address by mr patrick honohan, governor of the central bank of ireland, to the university college dublin economics society, dublin, 6 october 2014. * * * introduction with a single currency, a single monetary policy and, now, a single system for supervising key banks, what role ( it could be asked ) is left for a national central bank operating within the eurosystem? the answer is, actually, quite a lot. true, while the single currency, and now the single supervisory mechanism, also play a fundamental role in delivering on the mission slogan of the central bank of ireland of ‘ safeguarding stability, protecting consumers ’ the central bank of ireland retains many functions to itself that also play a significant part in this. the euro getting the euro area inflation rate back up closer to 2 per cent, in line with the medium term target of the european central bank ( ecb ) is technically quite a tricky challenge. given that interest rates are already as low as they can go, the ecb has, like the fed, the bank of england and the bank of japan, been navigating uncharted waters which, in the european context, are known to contain hidden shoals and quick sands. from dublin, we try to bring a distinctive flavour to this difficult policy debate and contribute to influencing the design of novel instruments and programmes. the ssm ensuring that the irish banks could stay open and provide the essential payments and shortterm credit functions while they undertook urgent running repairs has been a big task for us at the central bank over the past number of years. the banks needed to re - assess their entire risk management functions and our role as prudential supervisor has been to assess and challenge their effectiveness in doing this. in addition to the application of standard international rules and practices, we have felt the need to improvise additional intrusive engagement with the banks to try to accelerate and improve the speed with which they have been processing and dealing with the very large percentage of their loan portfolio which is still not fully performing even after six years of crisis and the forced sale to nama of some €70 billion of large property loans. now that job of supervising the main banks from a prudential point of view passes to the new frankfurt - based single supervisory mechanism ( ssm ), following the completion later this month of the “ comprehensive assessment ” of capital adequacy. the comprehensive assessment illustrates the future continuing role in prude