Latest news with #GerryCross
Irish Times
12-06-2025
- Business
- Irish Times
Central Bank's role in approving Israeli bonds can be traced back to Brexit
It is something else that can be blamed on Brexit. When Britain decided to leave the EU in 2016 it no longer belonged to the European bond market. The market allows sovereign states to raise finance by issuing bonds that they pay back over time. The European Prospectus Regulation for bonds deemed that one European state would be the 'home state' that would determine if a non- EU state selling bonds had the financial wherewithal to trade the bonds in EU markets. The state would be chosen not by the EU but by the country selling the bonds. Until 2016 Britain was the country which decided if a bond prospectus offered by Israel could be approved for sale in the EU. When Brexit happened, Israel decided that Ireland should fulfil that role. It wasn't the only one to do so in recent years. At an interesting meeting of the Oireachtas finance committee yesterday, Gerry Cross of the Central Bank told Shay Brennan (Fianna Fáil) that seven other countries had also done so in recent years: Georgia; Turkey; The Maldives; Côte d'Ivoire; Armenia, Benin and Ukraine. To quote Macbeth: what's done is done and cannot be undone. Central Bank governor Gabriel Makhlouf told the committee that only Israel can decide to use another state to be the home country unless the EU at political level does what it did with Russia and imposes sanctions against Israel. Given the ties between some EU states and Israel, that's very unlikely to happen. Mr Makhlouf, Mr Cross and deputy governor Mary-Elizabeth McMunn told the committee that the EU regulation was strict; they could only make the approval determination based on financial stability criteria and not on wider geopolitical considerations. Effectively their hands were tied. READ MORE This issue was a dominant one in political discourse again this week, with a second Dáil vote in as many sitting weeks over the bonds last night. This time the vote was on a Social Democrats motion and again it was defeated. As Marie O'Halloran reports, two Independent TDs who support the Government – Gillian Toole and Barry Heneghan – voted against the Coalition. The debate last night revolved around the same issues. Taoiseach Micheál Martin and Minister for Finance Paschal Donohoe both took exception in the Dáil and other forums to the accusation from the Opposition that the Government was somehow complicit in the genocide because the Central Bank approves the bonds. Martin completely rejected the assertion at the Fianna Fáil parliamentary party meeting last night. He has argued that the Central Bank was independent in its role, and that its determination was a technical one based solely on financial criteria. Still, Ireland's unwanted status has made everybody uncomfortable. Meeting offers further details on bonds The three-hour meeting of the finance committee was interesting in that we learned that for all the trouble they have caused the returns from the bonds in Europe are relatively modest. Israel has raised between €100 and €130 million from the bonds, Mr Makhlouf said. He said the Israeli government website marketing its 'war bonds' had stated it had sold bonds worth €5 billion. He said the EU accounted for only a fraction of that, with the US accounting for the bulk of it. On what the bank can and can't do, he said: 'The Central Bank cannot decide to impose sanctions for breaches or alleged breaches of international law. It is for international bodies such as the UN or the EU to determine how to respond to breaches or alleged breaches of international law.' Mr Cross, director for capital markets at the bank, confirmed that the Central Bank fees for the approval of Israeli bonds between October 2023 and May this year was €13,300. The EU prospectus is due for renewal in September. When asked by Ged Nash (Labour) if there were new issues to be considered, Mr Makhlouf said the 'intensity of the conflict in Gaza probably does put a question mark [on] whether the financial viability of the state still remains secure'. He added: 'The European Union has indicated that it's going to look at its co-operation agreement with Israel, and I think that's a factor, the fact that the finance minister [Bezalel Smotrich] has just been sanctioned by a number of countries.' However, he said it should not be taken as granted that the prospectus would not be renewed. Asked by Mr Nash about how employees of the Central Bank have reacted to its role approving Israeli bonds, Mr Makhlouf said that the views in the bank were a reflection of the view across society. 'They range [from] people who are very sympathetic to one side of the debate, but also people who are sympathetic to the other side of the debate,' he said. Fallout of Arts Council ICT project continues The Oireachtas committee on media and arts returned for a second time in recent weeks to its examination of the implications of a partially abandoned ICT project that cost the Arts Council €7 million and also cost its director Maureen Kennelly her job – Minister for Arts Patrick O'Donovan made the decision that her contract was not to be renewed. The Arts Council has become the fall guy taking most of the blame for the failure. But yesterday the committee, chaired by Labour TD Alan Kelly, honed in on the action, or lack of action, by the then Department of Arts in the matter. Ms Kennelly told the committee that the council had written to the department some 60 times in relation to difficulties with the project. It was disclosed that the department never escalated the issue to senior management beyond principal officer level. Jack Horgan-Jones has the details of how the department's shortcomings were discussed during the meeting. Pepper sprays Paul Gogarty with shouting Jack Horgan-Jones reports on a stand-off between Independent TD Paul Gogarty and two anti-immigrant Dublin city councillors, Malachy Steenson and Gavin Pepper. Both shouted him down when he tried to speak. Mr Gogarty had been addressing a group of protesters objecting to the prospective State purchase of the Citywest Hotel, which is being used to accommodate people seeking international protection. He did not get very far in his contribution. He opened his remarks with a 'preamble', saying that he did not condone any form of racism or abuse. 'I wasn't allowed to finish my preamble,' he said. Best Reads Miriam Lord gives a peerless example of how an unmissable 900-word column can be constructed from a single line . No smokers without fire, that should be her motto. Emmet Malone has a comprehensive Q&A piece on how errors were made in calculating the pensions of certain politicians and civil servants. Seanín Graham reports that after weeks of speculation, a £50 million (€59 million) investment was offered by the British government to redevelop the derelict Casement Park GAA stadium in Belfast. It's good news but there is still a £90 million shortfall of the estimated £260 million cost to transform the dilapidated site. Playbook Dáil 08.47: Parliamentary Questions: Tánaiste and Minister for Defence Simon Harris 10.23: Parliamentary Questions: Minister for Education and Youth Helen McEntee 12.00: Leaders' Questions 12.34: Other Members' Questions 12.42: Questions on Policy or Legislation 13.52: Government Business: Statements on Fisheries 16.17: Government Business: Statements on Nursing Homes and Care for Older Persons 18.17: Topical Issues 19.17: Private Members' Bill: Criminal Law (Prohibition of the Disclosure of Counselling Records) Bill, 2025 – Second Stage 21.17: Dáil adjourns Seanad 09.30: Commencement Matters 10.30: Order of Business 13.00: Government Business: Statements on delivering a world class education system, which breaks down barriers and ensures every child can achieve their full potential 14.30: Seanad adjourns Committees Defence and National Security 09.30: Pre-legislative scrutiny of a general scheme: Defence Amendment Bill, 2025 Fisheries and Maritime Affairs 09.30: Extension of EU-UK trade agreement and the implications for the Irish fishing and seafood industry Children and Equality 10.00: Insight into the priority topics and issues facing the department
Irish Daily Mirror
12-06-2025
- Business
- Irish Daily Mirror
Central Bank governor says question marks over Israel's financial stability
The 'intensity' of the conflict in Gaza 'puts a question mark' over whether the financial viability of Israel 'still remains secure', the Central Bank of Ireland governor has said. The Central Bank of Ireland (CBI) insisted that it cannot 'impose sanctions' on Israel or stop facilitating the sale of so-called 'Israeli war bonds'. It also said that it does not have to consider the Genocide Convention when reviewing or approving prospectuses. The comments were made at the Finance Committee, which was held several hours before the Dáil was due to vote on selling the bonds for the second time in as many weeks. The CBI is the designated authority for the sale of Israeli bonds in the EU. It is responsible for assessing whether a prospectus is in compliance with the requirements of the EU Prospectus Regulation. Gerry Cross, Director of Capital Markets and Funds at CBI, told TDs and senators at the Finance Committee that they must ensure that relevant information is included, such as 'does this disclose the things that an investor needs to know to understand their financial risks' before they invest. Gabriel Makhlouf, Governor of the CBI, confirmed that Israel has yet to contact the bank about renewing the prospectus before it expires in September. Labour's Ged Nash asked Mr Makhlouf the questions and issues the CBI would 'raise with the Israeli State' if they seek to renew the prospectus before it expires in September. The Governor said that he would expect Israel to divulge that its war on Gaza is affecting its financial stability. He said: 'I would expect [the prospectus] to set out any new developments that are relevant. 'It depends at the moment when they actually write to us, but I think the intensity of the conflict in Gaza probably does put a question mark over whether you know the financial viability of the [Israeli] State still remains secure. 'The fact that the European Union has indicated that it's going to look at its cooperation agreement with Israel, I think that's a factor. 'The fact that the Finance Minister [Bezalel Smotrich] has just been sanctioned by a number of countries, that may be a factor. 'We haven't drawn up a list of the things that we'd expect to see. But clearly, you'd expect, in view of what's happened in this conflict, some impact on the financial affairs of the State will be material. 'Now, in the end, it is for the [Israeli] State to make the judgment whether it does affect its financial standing or not. 'We don't make that assessment. I would expect them to address that.' Mr Makhlouf said it is up to Israel to decide who they want to apply to another EU country to be the designated authority for the sale of bonds. In his opening statement, Mr Makhlouf stated that CBI is 'established by law, we are empowered by law, and we must always act within and in line with the law'. He said: 'One of the powers that has been assigned to us is to perform the functions of a competent authority under the European Prospectus Regulation. 'This means that we must approve a prospectus once certain conditions are met.' He insisted that the CBI does not 'issue, sell, trade or list these bonds' and that it does not 'authorise or supervise them' in the case of Israeli sovereign bonds. Mr Makhlouf continued: 'It is for international bodies such as the UN or the EU to determine how to respond to breaches or alleged breaches of international law, including to determine whether sanctions are necessary. 'The Central Bank cannot impose sanctions on Israel – for example, by refusing to approve the Israeli bond prospectus – in circumstances where the EU has not imposed any such sanctions itself.' While he condemned the war in Gaza and the blocking of aid, Mr Makhlouf said the CBI must 'carry out the statutory tasks and functions which have been assigned to us'.
Irish Times
29-05-2025
- Business
- Irish Times
Regulation cannot eliminate ‘inherently high' risk in crypto
Every few months from the great, inscrutable world of cryptocurrencies a fresh piece of terminology hits the mainstream, promising to revolutionise the world of finance. Stablecoins are now the next big thing. Invariably, after six months in which the new term fills newspaper columns and corporate types announce how they are embracing the 'complex synergies and unlocking capabilities' of the new tech, it is forgotten with the arrival of an even newer term or concept. The pace of innovation in the space is impressively fast, but that means regulators struggle to keep up with the inevitable knock-on consequences for investor risk. Addressing the Blockchain Ireland conference, Gerry Cross, the director for capital markets and funds at the Central Bank , alluded to that element. READ MORE 'Risks to consumers are inherently high in some crypto and related services, and crypto markets have been noteworthy for their significant volatility,' he said. Even with the introduction of the new EU-wide Markets in Crypto-Assets Regulation (MiCAR), Mr Cross said it 'will not provide the same levels of protection as exist for traditional financial investment products, nor will it mitigate all the risks linked to crypto-assets'. In a speech full of indications of the vast promise of decentralised and digital finance technology, this represents the stark reality of investing in cryptocurrency; it is a risky game. The Central Bank, which has moved from labelling unbacked crypto assets as more akin to a 'Ponzi scheme' than an investment to noting the potential of the latest hit topic, stablecoins, has a challenge on its hands in finding the balance between regulating the technologies and stifling innovation. [ Bitcoin price surge encourages more companies to acquire crypto Opens in new window ] Cross says a 'good outcome' for the regulator will be that the risks involved in cryptocurrency investments are understood and that 'any change occurs in a safe manner'. However, this is an industry that often trumpets the mantra of 'move fast and break things'. An increasing number of cryptocurrency and related digital finance firms are choosing to locate in Ireland. It remains to be seen whether regulatory attempts to maintain 'safe' change will keep pace with the constant development and launches of new technologies in such a 'significant volatility' market.
