The Central Bank will start the phased introduction of a national credit register in 2016 under a new strategic plan for the institution.

The release of the 2016-2018 plan comes as Prof Philip Lane prepares to take command of the bank in succession to outgoing governor Patrick Honohan.

Amid controversy over the payment of bonuses or “retention payments” to some 30 middle managers in the Central Bank, the plan says the “most significant challenge” for the operation of the institution is attracting and retaining staff with the right skills and experience.

Areas scrutinised in an internal review of the organisation include career paths, reward and recognition, and internal processes, the plan said.

In addition to the introduction of a central credit register, the plan sets out a framework for the application next year of a new solvency regime for the insurance sector.

Future bank rescues

The plan also sets out how the Dame Street institution will implement Europe’s bank recovery directive, the objective of which is to ensure the cost of any future bank rescues are borne by the bank investors instead of states and their taxpayers.

The aim of the new credit register is to provide lenders with a more comprehensive analysis of creditworthiness of borrowers, with information on their credit profile.

The law underpinning the new register requires lenders to submit personal and credit information on loans of €500 or more.

Lenders will also be required to consult the register when considering a loan application for €2,000 or more.

Operational timetable

“The initial phase of the central credit register is expected to become operational in 2016,” said the plan. The second phase is “tentatively” scheduled for 2017.

With the Solvency II framework for insurers and reinsurers to take effect from January 1st, the Central Bank plan said the institution will extend onsite inspection activities to further sectors of the industry.

The Central Bank is represented on the Single Resolution Board, a new EU institution which will manage a rescue fund into which banks will make contributions.

The Bank Recovery and Resolution Directive “aims to shift the cost of financial crisis away from sovereigns and taxpayers on to institutions, by introducing a tool to ‘bail-in’ shareholders and liability-holders in order to absorb losses and recapitalise a failed firm,” said the plan. The bank is the resolution authority for Ireland.