Ireland has much to offer the international financial services sector and remains an attractive location for companies, IFSC president John Bruton said today.
A combination of a competitive tax regime, falling costs and a substantial pool of talent make Ireland a good location for international finance firms, despite the difficulties afflicting the domestic banking sector.
Speaking ahead of the inaugural conference of the Federation of International Banks, Mr Bruton said he was optimistic about the sector.
"With the downsizing of our domestic banking sector, a lot of skilled people will become available for re-employment," he said.
"I believe the international financial services sector offers a very good opportunity to those who may not have long-term employment prospects in the domestic banks to transition into international banking based in Ireland."
Almost 30,000 people are employed in the international financial services sector.
The banking crisis was not deterring international firms from establishing a base here, he said. Mr Bruton referenced an expansion by Asset Control of its Dublin operations that should lead to the creation of 50 jobs as evidence that not all international sentiment towards Ireland was negative.
"This is a business that is inherently risky, and it's about acceptable risk as against unacceptable risk," he said, adding that stress tests were "estimates based on assumptions".
"They're not facts that have been established beyond challenge," he said. "They are estimates about the future based on assumptions about the future. I think it's important to keep them in proportion to that".
Mr Bruton said he was confident Ireland would retain its low corporate tax rate, despite pressure from other European countries to increase it.
"The low corporate tax policy we have had pre-dates the EU," he said. "It's the means we have used to attract foreign investment, it's the basis on which we've structured our economy, and it's the economy that will repay the loans that people have extended to us," he said.
"No good banker would lend somebody money, and then insists as part of the condition of receiving the money that they destroy the factory machinery they will use to produce the goods to raise the money to repay the loans. That wouldn't be sensible banking policy and it wouldn't be sensible for Europe to interfere with this."
Mr Bruton also dismissed talk of burning senior bondholders.
"Do we want badly enough to regain our economic independence? Do we want to be the country that can live up to its reputation that it has worked so hard to obtain, that lives up to its word that it keeps its commitments? A bond is a commitment," he said.
"It is important to any country both for its own self respect and for the international respect, to have credibility in international finance, that it keeps its word. I think Irish people have it in them to do this. It's not going to be easy.
"Let's not get lost in financial jargon about subjects that we never heard of a year ago - let's keep our eye on the big picture."
