Regulator defended by those it polices

Now I am as open as anyone to persuasion about the pros and cons of the proposed single regulatory authority for the financial services sector.

There are deep-seated concerns about potential conflicts of interest in the Central Bank's current role as defender of the integrity of the banking system and protector of the customer - roles which might not always be complementary.

It is also true that the bank has been reluctant to take on board regulatory responsibility for some smaller areas of the sector, leaving those areas open to a complex and all too often ineffective regulatory regime.

On the other hand, the Bank does have a good reputation in the international community on regulation in those areas it does cover and there is no doubt that the people with the requisite experience currently reside in Dame Street.

In addition, there seems to be some substance to the argument that the report proposing the single regulatory authority was, in some respects, a rush to judgment. It certainly seems to have been marked by a dramatic U-turn shortly before it issued its findings.

Nonetheless, the sudden rush to the defence of the regulator (the Bank) by the regulated (the Irish Bankers' Federation's members) does give one cause to reflect . . .