Irish funds sector assets triple to 5.6 trillion euros
The Central Bank of Ireland has published a comprehensive supervisory review of delegation practices across 121 fund management companies. Deputy Governor McMunn highlighted rapid sector growth alongside notable governance shortcomings.
Tripling assets and rising risks
Over the past decade, the Irish funds sector has more than tripled in size, with assets under management surging from 1.6 trillion euros to 5.6 trillion euros.
Concurrently, the number of authorised investment funds expanded by approximately 50 percent, rising from 6,000 to 9,000. Delivering a speech at PwC, Central Bank of Ireland Deputy Governor McMunn noted that this rapid expansion has occurred alongside mounting geopolitical shifts and economic fragmentation.
The review encompassed 121 fund management companies, involving 41 deep-dive desk-based assessments and 21 onsite inspections that covered over 35 percent of total assets under management in the jurisdiction.
Governance gaps in delegation
While acknowledging that fund management companies recognize the importance of robust controls, the supervisory review identified notable vulnerabilities.
Key areas requiring enhancement include board independence, over-reliance on group-level committees, resourcing constraints, deficiencies in contingency planning, and limitations in data access.
McMunn emphasized that delegation must be supported by substantive oversight rather than performative compliance.
The Central Bank plans to launch a comprehensive review of its governance frameworks, with formal consultations scheduled for early 2027.
A reckoning for remote control
The regulator is drawing a hard line against hollowed-out governance structures.
By targeting delegation practices and teasing potential SEAR rules, the Central Bank is raising compliance costs for international fund houses.
Ultimately, Dublin signals that scale brings no immunity from accountability.