Bank of Montreal fined €650,000 for three breaches of regulations
This is the latest in a series of fines imposed by the Central Bank on foreign financial firms based in Ireland. The Central Bank has undergone an overhaul since the financial crisis with the emphasis on a much more intrusive and robust style of regulation.
In January 2013, the Central Bank queried Bank of Montreal in respect of a particular financial exposure contained in a regulatory, large exposure, return.
Bank of Montreal initially advised that this exposure was exempt from large exposure limits as it was an exposure to a client, which is an institution, and which was due to mature in less than one year. However, the firm subsequently accepted that, due to a change in legislation, this exemption was not available to it, said the Central Bank.
The second breach by Bank of Montreal was discovered in February 2013, when it notified the Central Bank that, due to an issue with data feeding into large exposure returns and capital (solvency) returns, its exposures under swap transactions with its ultimate parent company and an affiliate had not been calculated correctly in these returns.
The Central Bank said that it takes very seriously any breach of regulations on capital adequacy and loan loss exposures.
However, it took into account the fact that Bank of Montreal notified the Central Bank immediately when it discovered that these breaches had occurred.
The Central Bank confirms that the matter is now closed.
