Speech by Minister Murphy at ACI Congress

12.05.17

Speech by Minister Murphy at ACI Congress

 

Opening

Good morning ladies and gentlemen.

Pleasure to have the opportunity to address you this morning at your Annual ACI Congress.

You have an excellent programme lined up over the next two days.

Plenty of opportunities for discussion & debate.

But don’t forget the important networking too.

 

It’s great to see such a high profile event held in Dublin, for the second time, and I hope Dublin plays host to the event again in the future.

Indeed, more and more significant international events in Financial Services are taking place in Ireland.

This reflects our ever-growing and exciting international financial services sector.
 

European Financial Forum (EFF)

For example…

In January of this year we hosted the second annual European Financial Forum in Dublin Castle, together with the Financial Times.

The Forum was attended by more than 650 delegates, representing over 300 organisations, from more than 20 countries.

 

Keynote speakers from all over the world, included

  • the President of the Asia Infrastructure Investment Bank,
  • the Vice-Chairman of Blackrock,
  • and the Vice President of the China Investment Corporation, to name just a few.

Next year the EFF will again return to Dublin Castle on the 31 January 2018.

Work is also underway on a special international conference on FinTech & Payments later in the year.

So hopefully you can join us for these events – keep an eye on IFSIreland.com for details.

 

IFS2020

 

But communicating our activities, having a brand, and having  substance behind and vision behind that brand is essential to growing our industry.

2014 – the Government decided to make Financial Services a key pillar of our strategy to increase investment and create high value jobs here in Ireland.

Minister of State was appointed to politically drive the process

2015 – a five year strategy was published – IFS2020

 

  • Vision: make Ireland the global location of choice when it comes to specialisation and innovation in Financial Services.
  • To make that vision a reality, we brought together the relevant actors on the government side, together with industry to plan our approach.
  • No point in the government going off in one direction if industry is not going to follow.

 

Aim of IFS2020 is to increase the numbers employed in international financial services by 30% or 10,000 net new jobs over the five years of the strategy from 2015 to 2020.

We have already seen a 13% increase in those employed in the sector since the strategy was launched.

More importantly than that, the value of the types of jobs being created is higher, their importance greater.

If you look at the Action Plan for 2017 you will see that two key pillars are Education, Training and Skills Development & FinTech and payments.

This is how we intend to build for the future, to put ourselves at the cutting edge, as a gateway to the EU Single Market and the wider world

Brexit

Of course, membership of that market is changing.

The UK is leaving the European Union, which means leaving the single market.

What kind of access it will have to the Single Market in the future will probably not be known for many years.

This is why another key pillar of our planning in the evolving strategy has been Brexit.

London will continue to be a global financial centre – this is important for Europe, but also for Ireland because our own FS offering complements London in so many ways.

But these uncertainties around continued market access have posed a significant challenge to financial services firms who access the single market from the UK.

And because it is not certain how access might be continued, and on what terms, or when, in order to be certain of continuity, these international financial services providers are relocating part of their business outside of London.

Many are making a positive choice to relocate to Ireland.

Because of our Common Law Jurisdiction

Because we speak the English Language

Because of our Location

– the busiest air-route in the Europe is between Dublin and London.

– We are also the only European country with US pre-clearance.

And Because we already have a plan to make ourselves a strategically important Financial Services centre for the Union and the wider world.

So we are one step ahead of the game.

We will endeavour to maintain the strongest possible links with the UK on many fronts.

Indeed I recently led a trade mission of 22 Irish Fintech companies in to the UK.

But our strategic interests lie in European Union.

We are already a gateway in to the Single Market for the leading tech and pharma firms.

Increasingly we are becoming that gateway for Financial Services.

 

European Banking Authority

 

But a gateway to what?

And for whom?

The UK leaving the EU obviously changes the market.  It’s disruptive, and in our view it is negative disruption.  But there are always positives to disruption – sometimes you just have to work harder to see them and achieve them.

We have a chance now to look again at our market for Financial Services and see how we can improve it.  Already in the area of supervision and regulation we are seeing new proposals.  Some of which are very positive and will enhance protections and the integrity of the Single Market, for the businesses and citizens within the market .

The European Commission is currently carrying out a review of the European Supervisory Authorities (of which the European Banking Authority is one).

Included in this consultation is the option of merging the EBA with another authority based in Frankfurt, or the option of relocating the existing body elsewhere.

As we know, the EBA, in some shape or form, must leave the United Kingdom.

At the recent European Council it was stated that a procedure for deciding the location for the EBA will be agreed in June, with the potential for a decision on their new location in autumn.

The European Banking Authority is an important part of the European System of Financial Supervision that arose after the financial crisis.

It is key that the EBA can continue its critical work with minimal disruption following the decision of the UK to leave the European Union.

The Irish Government has made a public declaration of interest in hosting the Authority.

We strongly believe that relocation to Dublin is the best option for the important work of the Authority, and the least disruptive location for its work and for its staff.

Our interest in hosting the Authority demonstrates the continued importance Ireland places in well regulated Financial Services.

And in our bid we have sent a signal to the global financial sector of the importance that Ireland places on this sector.  

Capital Markets Union

Another way in which we can improve our market is to continue to develop and to deepen it.  Capital Markets Union is one such opportunity.  And an example of how the EU’s focus is moving beyond crisis management, and increasingly turning to how financial markets can best serve the broad policy objectives of jobs and growth.

The European Commission has published a report on national barriers to capital flows

  • identifying a number of areas to be improved
  • which would enhance regulatory convergence
  • and enhance the movement of capital within the Union.

The Commission has also recently closed its public consultation for its CMU mid-term review, which will be completed this June, outlining how the CMU can be updated and improved.

Ireland’s fund offering has a lot to gain from such measures and we strongly welcome this development.

Ireland’s particular focus has been, and will continue to be, on what the Capital Markets Union can do for SME’s and for smaller markets.

Given the important role that SMEs play in terms of job creation, we continue to support the strong emphasis placed within the Action Plan on the need for an integrated CMU to benefit SME’s in particular.

Again, this is why we say, as a government, that our door is always open to business – because businesses create jobs, and jobs bring a sense of purpose, they create money to spend, and tax revenues to invest in public goods.

There has been strong progress made in a number of important CMU files.

The Regulation amending the Prospectus framework is nearing completion, this includes legislative proposals for

  • Securitsation,
  • European Social Entrepreneurship Funds
  • and European Venture Capital Funds

Which are currently at trilogue stage.

These files are great opportunities to ensure the goals of CMU are achieved.

Closing

So, with the disruption of Brexit and everything else that is happening on the global stage, we do see opportunities, both as a result of recent uncertainties – but also in spite of them.

We are very ambitious for the future of financial services in Ireland, as a bridge between the UK and the EU, and a gateway for the wider world.

We are embracing new developments in the EU and looking for more leadership roles.

And we are embracing new developments in FinTech and technology generally, to make sure we are at the cutting edge.

  • Good luck for the remainder of the Congress
  • I hope you enjoy your time in Dublin.

Thank you

12 May , 2017