Governor of the Central Bank of Ireland gives his first keynote speech to WIT students

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Gabriel Makhlouf said that he chose to make his first speech to students as they and their peers are the future, and the vanguard of further progress

As part of the Central Bank’s Outreach and Engagement programme, Gabriel Makhlouf delivered his first keynote speech as Governor to an audience of students at WIT.

In his first keynote speech since being appointed Governor of the Central Bank of Ireland, Gabriel Makhlouf set out the key challenges, risks and transitions which Ireland faces.

Speaking to students and staff at Waterford Institute of Technology, and the Chamber of Commerce, Governor Makhlouf highlighted the vulnerability of the Irish economy, particularly in the context of Brexit and the risk of escalating trade wars.

He said: “Building economic resilience is not like building a bulwark and then assuming the job is done. There is no one-off solution to the challenge of building resilience. It is a continuous process, involving individuals, households, businesses, institutions and authorities, such as the Central Bank, both at home and abroad.”

Challenges

While acknowledging the substantial improvements in resilience made over the last decade, citing reductions in public and private sector indebtedness, he identified four key transitions which pose challenges to the Irish people: Brexit, climate change, the pace of technological change, profound changes which are taking place in the financial system.

He highlighted that given Ireland’s international interconnectedness, building resilience through these transitions is essential: “for me it is about continuing to focus on the fundamentals, about managing the short-term while planning for the medium term. It is about ensuring our frameworks are fit-for-purpose and learning the lessons of the past while preparing for the future.  It is also about being prepared to challenge ourselves.”

Mortgage measures

He noted that the mortgage measures are a permanent feature of the mortgage market and have been key to enabling sustainable lending. He added, “it is important to take stock, learn lessons and continue to develop.  In particular it is important to consider how the suite of macroprudential buffers interact not only with each other but also with those of microprudential supervision – arriving at a consistent and holistic view of capital for the banking sector – and the other key macroprudential tools in operation. We must continue to look at whether the objectives and scope of our wider macroprudential framework remains appropriate to the current environment.”

Macroprudential framework

“Given the growth in market-based finance in recent years, there is growing focus on understanding the financial stability risks posed by these developments. This is particularly important given the ‘lower for longer’ monetary policy environment we find ourselves in. It is important for our macroprudential framework to grow and widen to reflect these developments with policies to promote financial stability and to mitigate the impact of negative shocks on the real economy.”

Question time

WIT students were given the opportunity to ask questions at the end of the speech and got some insight into the Governor’s perspective on a number of different areas.

In addition, Director General, Financial Conduct, Derville Rowland met Masters Business and Finance Students for a discussion on “the role of financial conduct in protecting consumers and investors.”

The Governor also visited ArcLabs, WIT’s research and innovation hub and met with Dr Aisling O'Neill who gave him tour of the centre and arranged for him to meet with some of the client companies based there.

Also on the agenda for Governor Makhlouf and Director General, Financial Conduct, Derville Rowland on the day was a visit to secondary schools today during their visit to Waterford. Governor Makhlouf will visit St. Paul’s Community College and Derville Rowland will visit St. Angela’s College.

Related Courses

Bachelor of Business (Honours) in  Business (Economics & Finance)
Master of Business in  (Economics and Finance Stream)
Master of Science in  Global Financial Information Systems (GFIS)

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