Dáil Éireann Debate, Tuesday - 26 May 2026
442. Deputy Pearse Doherty asked the Tánaiste and Minister for Finance further to Parliamentary Question No. 258 of 14 May 2026, the criteria necessary for a financial institution to qualify as a monetary policy counterparty with the Central Bank. [38996/26]
View answerThe Central Bank of Ireland has provided me with the following information on the matter.
"Article 55 of the Central Bank of Ireland’s Documentation on Monetary Policy Instruments and Procedures
(www.centralbank.ie/docs/default-source/monetary-policy/policy-implementation/monetary-policy-instruments-and-procedures.pdf?sfvrsn=b444601a_14) sets out the eligibility criteria for participation in Eurosystem monetary policy operations.
Article 55a sets out the assessment of the financial soundness of institutions required to become an eligible monetary policy counterparty.
Article 55 Eligibility criteria for participation in Eurosystem monetary policy operations
With regard to Eurosystem monetary policy operations, subject to Article 57, the Eurosystem shall only allow participation by institutions that fulfil the following criteria:
(a) They shall be subject to the Eurosystem’s minimum reserve system pursuant to Article 19.1 of the Statute of the ESCB and shall not have been granted an exemption from their obligations under the Eurosystem’s minimum reserve system pursuant to Regulation (EC) No 2531/98 and Regulation (EU) 2021/378 (ECB/2021/1)
(b) They shall be one of the following:
(i) subject to at least one form of harmonised Union/EEA supervision by competent authorities in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013;
(ii) publicly-owned credit institutions, within the meaning of Article 123(2) of the Treaty, subject to supervision of a standard comparable to supervision by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013;
(iii) institutions subject to non-harmonised supervision by competent authorities of a standard comparable to harmonised Union/EEA supervision by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013, e.g. branches established in Member States whose currency is the euro of institutions incorporated outside the EEA. For the purpose of assessing an institution’s eligibility to participate in Eurosystem monetary policy operations, as a rule, non-harmonised supervision shall be considered to be of a standard comparable to harmonised Union/EEA supervision by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013, if the relevant Basel III standards adopted by the Basel Committee on Banking Supervision are considered to have been implemented in the supervisory regime of a given jurisdiction.
(c) They must be financially sound within the meaning of Article 55a;
(d)They shall fulfil all operational requirements specified in the contractual or regulatory arrangements applied by the Bank or the ECB in respect of the specific instrument or operation. The Bank’s operational requirements include:
(i) a requirement that counterparties execute the MPIPs Agreement;
(ii) a requirement that counterparties execute any collateral mobilisation agreement that is relevant for the purposes of a specific instrument or operation; Documentation on Monetary Policy Instruments and Procedures – 30 March 2026 Central Bank of Ireland Page 51
(iii) a requirement that counterparties must have access to an account in TARGET enabling it to conduct transactions with the Bank; and
(iv) any other requirements that may be notified to counterparties in this Document from time to time.
Article 55a Assessment of the financial soundness of institutions
In its assessment of the financial soundness of individual institutions for the purposes of this Article, the Eurosystem may take into account the following prudential information: (a) quarterly information on capital, leverage and liquidity ratios reported under Regulation (EU) No 575/2013 on an individual and consolidated basis, in accordance with the supervisory requirements; or (b) where applicable, prudential information of a standard comparable to information under point (a).
If such prudential information is not made available to the Bank and the ECB by the institutions’s supervisor, either the Bank or the ECB may require the institution to make such information available. When such information is provided directly by an institution, the institution shall also submit an assessment of the information carried out by the relevant supervisor. An additional certification from an external auditor may also be required.
In the case of branches, the information reported under paragraph 1 shall relate to the institution to which the branch belongs.
As regards the assessment of the financial soundness of institutions that have been subject to in kind recapitalisation with public debt instruments, the Eurosystem may take into account the methods used for and the role played by such in-kind recapitalisations, including the type and liquidity of such instruments and the market access of the issuer of such instruments, in ensuring the fulfilment of the capital ratios reported under Regulation (EU) No 575/2013.
A wind-down entity shall not be eligible to access Eurosystem monetary policy operations.
Question No. 447 answered with Question No. 211.
