Irish banking chiefs want a “reset” of EU business rules to free up firms from red tape, the sector said yesterday.

The Banking and Payments Federation Ireland (BPFI) said that while it “fully recognises” the stability strict regulations have brought, it fears that the rules are strangling growth – adding that “it is time for a reset” after 15 years of regulatory reform since the financial crash.

BPFI chief Brian Hayes insisted the sector is not calling for “deregulation” or “light-touch regulation”, but warned that “overly complex regulation” is strangling EU growth.

The EU rules were like a self-imposed “internal tariff” against the bloc’s own businesses, which the International Monetary Fund (IMF) said were equivalent to a levy of 44% on manufacturing and 110% for services, a BPFI report said.

Mr Hayes said: “With Europe’s competitiveness under mounting pressure, there is now a clear consensus across the EU, from both public and private sectors, that overly complex regulation is diminishing EU growth.”

In line with an EU-wide push on regulatory simplification, the report sets out measures to streamline and create a more uniform application of EU rules to ensure Irish-based firms can compete fairly across the bloc, ultimately safeguarding the sector’s competitiveness while supporting the long-term stability of the financial system.

BPFI proposals to streamline the sector’s rules, which have been submitted to the Central Bank of Ireland and the Department of Finance, comes as the Government prepares to publish its Action Plan on Competitiveness and Productivity, and the development of a new Ireland for Finance Strategy.

However, Mr Hayes – a former Fine Gael junior minister – stressed that the goal is not to tear up the regulations altogether.

He said: “The banking sector in Ireland fully recognises the financial stability and resilience that has been hard won by firms and our regulators since the global financial crisis.

“After a decade-and-a-half of intense EU regulatory reform, it is time for a reset.

“What we want to see is a common EU rulebook applied consistently and proportionately across the Single Market.

“It is important to note this report does not argue for deregulation – no bank operating in Ireland is arguing for light-touch regulation.

“We recognise national discretions, capital add-ons and gold plating aren’t unique to Ireland. They remain a feature of EU fragmentation.”

Key recommendations within the report focus on addressing issues such as the so-called “gold-plating” of EU rules, where Irish regulations go above and beyond the requirements of European standards.

The report says the practice can deter international investment and places Irish-based companies at a competitive disadvantage.

It also highlights the need for a “local single rulebook” to bring greater clarity to supervisory expectations for firms operating in Ireland and a more transparent and consistent approach to “proportionality”, or how rules are applied depending on a firm's size and risk profile.

The report proposes longer-term structural changes.

These include a call for legislative change to introduce a competition mandate for the Central Bank of Ireland.