A spat seems to have developed between the Deputy Governor of the Central Bank, Cyril Roux and senior officials in the Department of Finance over the extent and resourcing of the Bank’s oversight of the insurance industry.

According to correspondence, published in the Irish Times this morning, a senior department official, Aidan Carrigan, wrote to Mr Roux in March raising concerns about media reports commenting that price competition in the insurance sector might not be viable, and that reserve levels and actuarial knowledge in the sector might not be adequate. 

Mr Carrigan requested a report from Mr Roux setting out any issues of concern in particular with reference to companies such as RSA, Liberty and FBD Holdings, and the Bank’s assurance that it would take the necessary steps to ensure stability in the sector.

Mr Roux replied directly to the Sec Gen of the Department, Derek Moran, saying he (Roux) was accountable to the Oireachtas and the Central Bank board - not to the Department of Finance.

He pointed out that Mr Moran’s own position on the Central Bank Board was the statutory avenue for information sharing and he added that the staff "vacancy rate" in the Bank’s enforcement division was close to 40 percent due to government pay restrictions.