We move to the motion regarding the proposed approval by Seanad Éireann of the Credit Institutions (Financial Support) (Revocation) Scheme 2025 and of the Credit Institutions (Eligible Liabilities Guarantee) (Revocation) Scheme 2025. The two motions will be debated together and decided separately. I welcome the Minister of State, Deputy McConalogue. He is very welcome.

I move:

That Seanad Éireann approves the following Scheme in draft:

Credit Institutions (Financial Support) (Revocation) Scheme 2025,

a copy of which was laid in draft form before Seanad Éireann on 2nd December, 2025.

I thank the Members of the House for bringing this through the House today. I am bringing these motions before the Houses of the Oireachtas on behalf of the Minister for Finance, requesting resolutions to approve the following regulations in draft: the Credit Institutions (Financial Support) (Revocation) Scheme 2025 and the Credit Institutions (Eligible Liabilities Guarantee) (Revocation) Scheme 2025.

The Credit Institutions (Financial Support) Act, 2008 was enacted on 2 October and this provided the Minister for Finance with the powers to provide the bank guarantee. On 20 October 2008, it was introduced by way of statutory instrument via the credit institutions financial support scheme, which was SI 411 of 2008. The statutory instrument set out the terms and conditions in which institutions specified, by way of ministerial order made under section 6(1) of the Act, could benefit from the guarantee. On 9 December 2009, the eligible liabilities guarantees scheme, SI 490 of 2009, was introduced, having been approved by the Oireachtas. This scheme was made pursuant to section 6(4) of the Credit Institutions (Financial Support) Act 2008. The eligible liabilities guarantee scheme covered deposits and certain unsecured death securities for participating institutions where the liabilities were incurred after January 2010.

The terms of the credit institutions financial support scheme imposed ongoing obligations on covered institutions. I refer in particular to paragraphs 24 to 52 of the schedule to the credit financial support scheme, which contain provisions on restructuring, board representation, commercial conduct, remuneration and transparency and which impose reporting requirements on covered institutions. The obligations imposed on participating institutions under the terms of the eligible liabilities guarantee scheme are chiefly concerned with the establishment and operation of the scheme. The draft statutory instruments to revoke both schemes will remove the obligations placed on the relevant banks, being Bank of Ireland, AIB and PTSB Group, under the schedules of the schemes.

There are several obligations set out in the credit institutions financial support scheme and the eligible liabilities guarantee scheme that continue to apply to Bank of Ireland, AIB and PTSB Group companies. These obligations have become redundant due to there no longer being any guaranteed liabilities under the schemes and duplication of requirements under EU legislation.

Since the introduction of the eligible liabilities guarantee scheme and the Credit Institutions (Financial Support) Act 2008, European regulatory and supervisory structure for banks has changed fundamentally.

Credit institutions authorised by the Central Bank of Ireland are required to comply with the prudential reporting requirements set out under EU Regulation No. 575/2013, known as the capital requirements regulation. This provides for a comprehensive template for mandatory reporting of financial and operational data by banks throughout the EU.

The obligations and rights assigned to the Minister under the CIFS and ELG legislation, such as data reporting or ensuring compliance with codes of practice, have largely been codified into either domestic primary legislation or the capital requirements regulation, as amended. The comprehensive reporting requirements in the capital requirements regulations will remain once the credit institutions financial support scheme and the eligible liabilities guarantee scheme have been revoked. The revocation will eliminate the duplication of reporting requirements. In 2022, the Minister and Bank of Ireland, AIB and PTSB Group companies entered into deeds of partial release to release the banks from contractual obligations entered into in CIFS guarantee acceptance deeds in 2008 and ELG scheme agreements in 2009.

The State has significantly divested from its bank shareholdings. In line with the programme for Government commitment to complete the task of normalising the domestic banking system, a further normalisation of the relationship between the State and the domestic banking system was announced in June of this year. This included the removal of certain crisis-era measures, including certain restrictions pertaining to remuneration.

The draft schemes will revoke the credit institutions financial support scheme, SI 411 of 2008, and the eligible liabilities guarantee scheme, SI 490 of 2009. The revocation schemes are made under section 6(4) of the Credit Institutions (Financial Support) Act 2008. Section 6(5) of the Credit Institutions (Financial Support) Act 2008 provides that regulations may be made only if a draft of proposed regulations is laid before each House of the Oireachtas and a resolution approving the draft has been passed by each House.

In the context of the programme for Government commitment, I ask the House, on behalf of the Minister for Finance, to approve both resolutions to approve the schemes in draft, which have been laid before the House.

I am speaking on this issue because Senator Casey is away in Brussels this week.

Fianna Fáil supports these motions because they are practical, timely and necessary. They recognise how far our banking system has come since the global financial crisis and they remove obligations that are now outdated and fully replaced by modern European regulation.

These schemes were created in 2008, when Ireland faced a financial emergency. Our banks were under severe pressure, and urgent action was needed to stabilise the system and protect depositors. The Oireachtas passed the Credit Institutions (Financial Support) Act 2008, giving the Minister for Finance the power to provide a State guarantee. This led to the CIFS scheme. It guaranteed a wide range of bank liabilities for a two-year period and imposed strict obligations on banks that availed of the guarantee. Before CIFS expired in 2010, a second scheme, the ELG scheme, was developed. This scheme provided a more limited guarantee, mostly for deposits and certain types of bank debt. The ELG scheme was extended several times, and while it closed to new liabilities in 2013, guarantees remained in place until 2018.

These schemes were essential at the time. They helped stabilise our banking system, maintain confidence and ensure that depositors and businesses had the security they needed during an economic crisis.

Today all guaranteed liabilities under these schemes have expired. The contractual obligations arising from the original guarantee agreements were formally released in 2022, and the broader European regulatory environment has completely changed since 2008.

Despite this, however, some obligations contained in the schedules of these schemes technically remain in place for Bank of Ireland, AIB and Permanent TSB. These obligations relate to areas such as restructuring, board representation, commercial conduct, remuneration, transparency and reporting. While once necessary, all these requirements are now fully duplicated, and in many cases expanded on, by EU law and by the Central Bank's supervisory framework.

Revoking the schemes will remove obligations that no longer have any purpose; eliminate duplication between outdated national requirements and the modern EU regulatory regime; provide clarity for the banks that the remaining legacy provisions from these guarantee schemes are now fully closed out; and support a cleaner, simpler regulatory framework.

It is important to note that this does not in any way relax the oversight of Irish banks. The core prudential obligations that matter - those covering capital, liquidity, risk management, transparency and reporting - are all governed by EU legislation, including the capital requirements regulation and directive. These are comprehensive frameworks that apply to all credit institutions in the EU and are enforced by the Central Bank of Ireland.

The reporting requirements alone under the CRR are far more extensive than anything contained in these older schemes. Banks must report detailed financial, operational and risk data on a regular basis; they must comply with strict rules on remuneration, conduct and governance; and they remain fully subject to the obligations that come with being regulated entities in the EU banking system. In short, all the meaningful protections are still very much in place, and none of those protections depends on these now outdated guarantee schemes.

The guarantee schemes introduced in 2008 and 2009 played an important role during a time of financial stress. They served their purpose well and helped safeguard the State's financial system at a critical moment. That moment, however, has passed. Today the remaining obligations are outdated, unnecessary and fully replaced by stronger European rules. Revoking the schemes is not only logical; it is good regulatory practice, it reduces duplication and it reflects the stability that now exists in our banking sector.

For these reasons, Fianna Fáil supports the motions to approve the Credit Institutions (Financial Support) (Revocation) Scheme 2025 and the Credit Institutions (Eligible Liabilities Guarantee) (Revocation) Scheme 2025.

I join the Leas-Chathaoirleach in welcoming the Minister of State, Deputy McConalogue. At very different times - he would want that emphasised - we attended the one educational institution and played fairly similar roles there. There is, however, a very big gap in time. In case he interrupts proceedings, I put that on the record.

The Credit Institutions (Financial Support) Act 2008 enabled the then Minister for Finance to enact the bank guarantee scheme. The EU Commission approved the bank guarantee scheme as being necessary to remedy the serious economic distress in Ireland.

After approval by the Houses of the Oireachtas, it was introduced by way of SI 411 of 2008, the Credit Institutions (Financial Support) Scheme 2008, which set out the terms and conditions and had a life of two years. It guaranteed all deposit liabilities, including retail, commercial and institutional liabilities; all covered bonds; senior debt; and subordinated debt. In simple terms, at a critical stage and at a time of great peril, it guaranteed the savings of individuals across the country. That was crucial along with the rest of the things I referred to. It was followed by the eligible liabilities scheme in December 2009, with less extensive cover. In 2013, the Minister announced that the eligible liabilities guarantee would end for new liabilities, so it was being weaned away, as it were. It is important to note that the majority of deposits continue to be guaranteed. This is a critical point. Anyone watching online or on Oireachtas TV needs to be reassured - it should be read into the record - that retail deposits are still guaranteed to a maximum of €100,000 and joint deposits are guaranteed to a maximum of €200,000. There is effectively a guarantee there yet.

The guarantee schemes had conditions at the time. They included restructuring of the boards, board representation, commercial conduct and remuneration and reporting. Those restrictions were naturally built into the financial guarantees. These obligations have become redundant as there is no longer any guaranteed liability under the scheme. There is no financial liability and therefore they become redundant. I will be addressing the way they are replaced. In 2022, the Minister entered into deeds of partial release with the credit institutions. It is important to reassure viewers, taxpayers, depositors and all the people of our country that the credit institutions are required to comply with the prudential reporting requirements set out under the EU regulation. That EU regulation, implemented domestically, includes a template for mandatory reporting, which still exists, with resultant transparency obligations which are all codified. I agree with Senator Crowe that they go further than the original regulation. This regulation has been implemented by the Government and of course there is the supervision of the EU regulation. We have the Government's implementation thereof and the Central Bank regulation.

As part of the 2022 banking review, pay restructuring was approved. That allowed a variation of €20,000 in individual pay packets and lifted the ceiling on senior executive pay. That engages a lot of discussion but it is important to note that there is a greater demand for staff now in IT. There is the cybersecurity issue, risk management, legal and compliance. The financial institutions including the credit unions are competing with the private sector for a certain pool of people. While the money looks extraordinary to lay people, in that world that kind of money is the norm. It is important also for people to know that in real terms, the State has recovered €2 billion more from the Bank of Ireland than taxpayers were liable for, so there has been a €2 billion win for taxpayers. The money has been retrieved.

In essence, the Credit Institutions (Financial Support) Act and the eligible liabilities guarantee schemes, the inherent regulations there, are redundant now. They have been replaced by EU regulation, by current Central Bank regulation and by Government implementation of the EU regulation. They are obsolete. It is a duplication to have all the sets of parallel regulations. In laypersons' terms, this exercise is a tidying up and an administrative overhaul. It is an acceptance of current and new realities. The financial guarantees were necessary at the time and indeed were supported by all the parties represented in this House. There would have been Armageddon without them. Now there is a new regulatory framework that supersedes anything that went with that. I support the legislation on behalf of Fine Gael. I hope it goes through the House with unanimous support. It is a worthy exercise.

I welcome the Minister and thank the Leader for facilitating today's debate. I raised an objection to how this was passing through the House yesterday. It passed through the Dáil without debate, which Members found unfair and objectionable. We felt the Government did not facilitate proper scrutiny of the legislation. I welcome the opportunity to raise a number of questions this afternoon. A number of speakers have made the point that these regulations were brought in for a time and a specific set of circumstances, which is quite right. The obligations under them were brought in to respond to a particular crisis. Arguably, in terms of transparency and reporting, if those obligations had been there prior to the financial crisis of 2008, we might not have ended up in such a mess. While the schemes themselves were limited to a certain approach, the obligations and transparency should be ongoing. The Minister in his statement said that the approach that has since been taken in EU and domestic legislation has more than compensated for the removal of these, and that this is to remove duplication. That would lead us to believe that all the issues that were in the previous set of obligations under these schemes are now covered again.

The statement and briefing note this morning raises a number of questions. It talks about the rationale for the revocation of these statutory instruments, and states that three banks have already released some of the obligations related to CIFS and ELG schemes. Can the Minister outline the current obligations that the banks are still under and that are relevant to these statutory instruments?

It also says that the obligations and rights assigned to the Minister under the scheme have largely been codified into other legislation. He said in his statement that this is to avoid duplication. For me, duplication means that they have been entirely codified into other legislation, not largely. That begs questions as to whether the powers of the Minister and the Central Bank have been wholly covered by other legislation. An assurance was therefore required that this does not mean a reduction in ministerial powers. I have heard Senators Crowe and O'Reilly say that these things are covered and this is a duplication, and that as a matter of fact there are more or stronger obligations in terms of transparency. I would like to hear that response from the Minister himself. Can he give a guarantee that no changes to oversight of the banking sector will be introduced by the revocation of these statutory instruments?

There was also the question of the banking remuneration section, which stated that taxpayers covered €2 billion, as Senator Joe O'Reilly said. That is misleading because there was also interest on the loans borrowed to bail out the banks. Has the entirety of that contribution been recovered, not just the €2 billion itself? Those are a couple of questions. Given that we were unable to secure a debate on this in the other House, I hope we receive sufficient assurances to allow us to support the passage of this. A number of questions still remain.

We want to ensure that all of the banks' reporting obligations, as well as the powers of the Ministers and the Central Bank, are covered in full by other EU and domestic legislation. I would welcome some clarity in relation to whether that €2 billion recovery includes the interest that was accrued on the loan taken out to pay that out to the banks.

As there are no other Senators indicating, it is now up to the Minister of State to respond.

I thank the Leas-Chathaoirleach and the three spokespeople for their contributions to the discussion. I will summarise the key points that have emerged and place them in a clear and factual context.

It is clear that Ireland's banking landscape has undergone profound change in recent years. The regulatory framework of the banking sector has changed significantly over the past decade, driven both by domestic and European legislation. This has included a material strengthening of banking regulation, which can be attributed to recognition of the regulatory failings that contributed to the financial crisis and corresponding loss of trust in the regulatory system.

Many reports have been completed post crisis, including the Department of Finance's banking review which addressed the impacts of the financial crisis. The review, which was conducted by officials from the Department with assistance from other Government agencies and Departments, made a wide range of recommendations to improve the experience of both the sector and the customer, recognising the critical importance of a stable and viable retail banking sector for the Irish economy.

From a financial stability perspective, the capital funding and liquidity positions of the traditional banks have strengthened considerably. As mentioned, financial regulation has transformed significantly in more recent years as a result of changes introduced through domestic reform and at EU level. The motions I bring before this House today to revoke these two schemes will further strengthen our regulatory framework. The schemes have served their purpose. The obligations under these schemes have become redundant as there are no longer any guaranteed liabilities under the schemes. Furthermore, there is duplication of requirements under existing EU legislation. I have brought these motions before the House on behalf of the Minister for Finance to request resolutions to approve the following regulations in draft: the Credit Institutions (Financial Support) (Revocation) Scheme 2025 and the Credit Institutions (Eligible Liabilities Guarantee) (Revocation) Scheme 2025.

In my opening speech, I set out the context and backgrounds of these two schemes. The Credit Institutions (Financial Support) Act 2008, which was enacted on 2 October 2008, provided the Minister of Finance with the powers to provide the bank guarantee. On 9 September 2009, the eligible liabilities guarantee scheme was introduced, having been approved by the Oireachtas. The draft statutory instruments to revoke both schemes will remove the obligations placed on the relevant banks - Bank of Ireland, AIB and the PTSB group - under the schedules of the schemes. As I have mentioned already, these obligations have become redundant due to there no longer being any guaranteed liabilities under the schemes and duplication requirements under EU legislation. I set out how the European regulatory and supervisory structure for banks has fundamentally changed since 2008. The comprehensive reporting requirements in the capital requirements regulations will remain once the credit institutions financial support scheme and the eligible liabilities guarantee scheme have been revoked. Their revocation eliminates the duplication of reporting requirements and removes unnecessary burden.

It should be noted that in 2022, the deeds of partial release were entered into by the then Minister and each of Bank of Ireland, AIB and the PTSB group to release the banks from contractual obligations in the CIFS guarantee acceptance deeds in 2008 and the ELG scheme agreements in 2009. The scheme has already significantly divested from its bank shareholdings. Furthermore, and in line with the programme for Government commitment to complete the task of normalising the domestic banking system, a further normalisation of the relationship between the State and the domestic banking system was announced in June of this year. This included the removal of certain crisis-era measures including certain restrictions pertaining to remuneration. These draft schemes will revoke SI 411 of 2008, the Credit Institutions (Financial Support) Scheme 2008, and SI 490 of 2009, the Eligible Liabilities Guarantee Scheme 2009. Section 6(5) of the Credit Institutions (Financial Support) Act 2008 provides that regulations may be made only if a draft of the proposed regulations is laid before each House of the Oireachtas and a resolution approving the draft has been passed by each House.

In addition, certain obligations have become redundant. The Minister and the Central Bank of Ireland imposed a number of obligations on the banks requiring them to, among other things, certify compliance with relevant matters; report and provide information to the Minister and to the Central Bank of Ireland; comply with certain restrictions relating to capital, share transactions and financial targets; and comply with any powers exercised by the Minister over the governance of the banks. These are known as the reporting and compliance obligations. The information that each bank has to provide under the reporting obligations in particular is voluminous and the obligations to do so arise frequently. This requires the banks to devote significant resources to meeting these and other compliance obligations. The reporting and compliance obligations are also separate to those which the bank owes to the European Central Bank and the Central Bank of Ireland as its regulators, which are onerous in their own right. Some of the requirements on the banks will remain in place subsequent to the revocation of these two schemes.

I commend both motions and revocations to the House. I thank all Senators for their contributions.