The Central Bank of Ireland has been advised to do more to ensure consumers are treated fairly by financial firms and banks, in a peer review conducted by the Netherlands Authority for the financial markets.

The review team said there is scope for the Central Bank to enhance its supervisory approach in respect of specific products in the market. It found the bank tends to focus more on the on-going supervision of individual product providers rather than on specific products that may pose a market-wide threat.

While the review team noted the Central Bank has a clear strategy in respect of consumer protection based around the five Cs – the consumer, confidence, compliance, challenging firms and culture – it said future strategy development may benefit from a more elaborate long-term plan. The Netherlands Authority said that a long -term plan should be built on treating customers fairly with appropriate measurement of the outcomes for consumers over the lifetime of the plan.

The review team said the Central Bank faces many competing demands in terms of protecting consumers and performing its related statutory functions with limited resources.

It recommended that the bank consider a more integrated prioritisation model, with the required flexibility to allow it to deploy its limited consumer protection resources towards addressing only the greatest threats to its statutory objective of protecting consumers.

Regulatory framework

Central Bank director of consumer protection, Bernard Sheridan, said the bank was committed to continually improving the regulatory framework and its supervisory practices in respect of the protection of consumers of financial services.

“We will carefully consider the recommendations emerging from the programme in the context of the development and evolution of our consumer protection strategy,” he said.