Credit institutions, investment firms, fund service providers and EEA insurers will be interested in the Central Bank of Ireland’s (“CBI’s”) latest consultation on a new methodology for calculating industry funding levies (“CP 108”). While currently funding levies are based on an entity’s risk impact categorisation, this can lead to “threshold effects” whereby a movement between impact categories can give rise to a substantial increase or decrease in levies. The proposed new methodology will introduce continuous levying thereby eliminating these threshold effects. The CBI is also proposing to move away from the single levy currently imposed on EEA insurers towards a risk-based funding model.
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