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The Central Bank of Ireland (CBI) has published Guidance on the Standards of Fitness and Probity 2025 (Revised Guidance) alongside a feedback statement following its April 2025 consultation.
Background
On 10 April 2025, the CBI launched a public consultation on revisions to aspects of its fitness and probity (F&P) regime and for this purpose it published:
The public consultation responded to recommendations by Mr Andrea Enria, former Chair of the European Central Bank’s Supervisory Board, following his independent review of the CBI’s F&P assessment process to assess its transparency, efficiency and effectiveness (see our previous client insight). The Draft Guidance and proposed changes to the PCF list addressed several recommendations calling for increased clarity and transparency of supervisory expectations in relation to the F&P assessment process.
This insight summarises the key changes under the Revised Guidance as compared with the Draft Guidance.
The Revised Guidance came into effect on 20 November 2025, replacing the previous Guidance on Fitness and Probity Standards that was published in December 2023.
PCF list
The consultation paper outlined several proposed changes to the CBI’s list of PCFs (i.e. removal of all sector-specific categorisations and merging and re-naming of certain PCF roles). However, most of the changes (including the removal of sector-specific categorisations) have not been implemented in the Revised Guidance. For now, a small number of changes have been made to the PCF list, namely the removal of PCF-24 (Head of Traded Markets) and PCF-25 (Head of International Primary Markets), and the addition of two new PCF roles, PCF-56 (Head of Safeguarding for Payment Institutions and Electronic Money Institutions) and PCF-57 (Head of Safeguarding for Crypto Asset Service Providers). The CBI will issue amending regulations to implement these changes.
The CBI will conduct a more substantive review of the PCF list and consult on proposed changes in 2026, with the revisions expected to be implemented in mid-2027 to coincide with a planned review of the Senior Executive Accountability Regime (SEAR). This approach to a more ‘holistic’ review of the full PCF list is in line with feedback received from industry during the consultation.
Consolidation of existing guidance
To ensure increased clarity and transparency of supervisory expectations, the Revised Guidance consolidates the following F&P related guidance and material into one document:
Head of Anti-Money Laundering and Counter Terrorist Financing Compliance (AML/CFT)
Additional expectations for PCF-52 (Head of AML/CFT) are introduced in the Revised Guidance. The CBI explicitly states that it expects firms to appoint a “member of senior management” with primary responsibility for implementing, managing and overseeing compliance with AML/CFT measures where such an appointment is proportionate to the nature, scale and complexity of a firm’s activities.
In addition, the CBI expects that where a firm is exposed to a significant degree of inherent ML/TF risk, the firm should consider whether it is appropriate for the relevant member of senior management to be a board member. Where a firm decides that it is not necessary to appoint a member of senior management to the PCF-52 role, it should record in detail its rationale for such decision. Expectations regarding the required level of knowledge and experience have also been included for this role.
Temporary officer appointments
To reflect the realities of recruitment and market conditions that were raised in stakeholder feedback, there is new guidance on the appointment of a ‘temporary officer’ (i.e. an individual who is permitted by the CBI to perform a PCF role on a temporary basis due to a vacancy).
Previous guidance recommended that temporary officer appointments should be used in exceptional circumstances only, and this was reflected in the Draft Guidance. In practice, this often caused practical difficulties when individuals did in fact move out of a PCF role with limited notice, with firms individually engaging with their supervisors on the appropriate structuring and oversight of the activities that the PCF role holder fulfilled pending identification, recruitment and approval of a replacement for that PCF role.
Under the Revised Guidance, a firm may now appoint an individual as a temporary officer for a period of up to six months subject to the prior written agreement of the CBI and the firm providing specific information and confirmations. The CBI may agree to an extension of the appointment in exceptional circumstances only. This is a welcome update to the regulator’s previous approach and, in many cases, will avoid the need to restructure reporting lines and ‘split’ activities during the period where no formally approved PCF is ‘in situ’.
Where a temporary officer is appointed to fill a role that has been permanently vacated, the firm will have to submit a PCF application in respect of the role within three months of the date of the appointment. The application may be in respect of the temporary officer or another individual. In the meantime, the temporary officer may perform the role for a period of up to six months while the firm is awaiting the CBI’s decision on the application.
Role of company secretary
While the role of company secretary was not addressed in the Draft Guidance, the CBI has included new guidance on the designation of the role. The FAQs had previously referred to the role of company secretary as being captured by the CF-1 category. The Revised Guidance clarifies that the designation of a company secretary as a CF-1 should be determined on a case-by-case basis. Where the functions performed by the company secretary enable him/her to exercise a significant influence on the conduct of the firm’s affairs, the individual should be designated as a CF-1. However, where the role is confined to administration of company law matters, the CF-1 designation is not required for those activities.
Performing a PCF/CF role outside of Ireland
The Revised Guidance clarifies that while PCF/CF roles performed outside of Ireland are captured by the F&P regime, firms must demonstrate a sufficient degree of substantive presence in Ireland in this context. For example, this should include the management of key risks from within the regulated firm and the making of key decisions by those within the firm and not elsewhere in the group. Requests for PCF role holders to reside outside Ireland will be assessed on a case-by-case basis considering the nature, scale and complexity of the firm and of the particular PCF role, the capacity of the individual to meet the CBI’s expectations while residing outside of Ireland and the residence of other PCF role holders in the firm.
Look-back period for due diligence
The Draft Guidance introduced a ten-year ‘look-back period’ under which, as a general rule, if ten years have passed since a final decision or finding in respect of an action that could be relevant to an individual’s ‘fitness and probity’ (save where a custodial sentence may have been imposed) and there are no other facts indicating material concerns regarding the individual’s fitness and probity, the individual can now be presumed to meet the F&P Standards.
The Revised Guidance retains this general ‘look-back’ rule but clarifies the exception: it states that where aggravating circumstances exist, the decision or finding remains relevant and material to the individual’s fitness and probity. In addition, the individual’s involvement in a matter that led to a criminal, civil or regulatory action must be disclosed in an Individual Questionnaire, regardless of the time elapsed since the conclusion of the matter, and the CBI will assess its relevance on a case-by-case basis.
Financial soundness
The Draft Guidance introduced new expectations around financial soundness assessments which are retained in the Revised Guidance, save for the expectation to provide evidence of financial soundness. In addition, the feedback statement confirms that checks should be performed on a best-efforts basis and, unless disclosures are made by the applicant or concerns arise that warrant investigation, public records should be sufficient.
Time commitments
The expectations regarding time commitments that were introduced in the Draft Guidance are retained in the Revised Guidance. Although the CBI generally expects executive roles to be performed on a full-time basis, the Revised Guidance did not carry over wording from the Draft Guidance expressly setting this out. However, there is nothing in the Revised Guidance to suggest that this does not remain the regulator’s expectation and that any arrangements under which an executive carries out that role on less than a full-time basis would need to be explained and well reasoned by the firm in question.
Board independence / independence of mind
The new expectations in the Draft Guidance regarding independence and “independence of mind” of board members are reflected in the Revised Guidance. The CBI also clarifies that it expects both the independence and the independence of mind of individual board members to be considered by firms when assessing an individual’s fitness and probity, particularly their ability to act with integrity and competence, their capacity and concurrent responsibilities.
Inherent responsibilities and PCF role summaries
The Draft Guidance provided that the “inherent responsibilities” under SEAR are relevant when assessing competence and capability. Although SEAR applies only to certain regulated entities, the CBI considers the inherent responsibilities under SEAR to have broader relevance across all financial sectors and has applied them to clarify the regulator’s expectations as to the nature of responsibilities held by certain PCF roles under the Revised Guidance.
However, the references to SEAR have been removed to clarify that the Revised Guidance does not extend the application of SEAR to regulated entities that are not already within its scope. Inherent responsibilities have been applied in this way in the Revised Guidance to the roles of CEO, Chair, executive and non-executive directors, Chief Risk Officer, Head of Compliance, Head of Internal Audit, Head of Actuarial Function, Head of Finance and Head of AML/CFT in all regulated firms (application to the Head of AML/CFT is new under the Revised Guidance). Additionally, to further clarify expectations, the Revised Guidance retains the brief role summaries for these PCF roles (and adds a role summary for Head of AML/CFT).
Level of knowledge and experience of board members
The Draft Guidance introduced expectations regarding knowledge and experience (including minimum years of experience) for the roles of CEO, Chair and executive and non-executive directors. However, the Revised Guidance allows for greater flexibility in the types of knowledge and experience considered appropriate (while retaining the concept of minimum years of experience).
Update to the Fitness and Probity Standards
Finally, the Fitness and Probity Standards have been updated to a November 2025 version that consolidates the previous Fitness and Probity Standards 2023 and the Fitness and Probity Standards for Credit Unions 2024 into one set of standards without substantive changes to the text.
For further information on the changes under the Revised Guidance or on the F&P regime more generally, please contact Dario Dagostino, Partner, Patrick Brandt, Partner, Mark Devane, Partner, Chloe Culleton, Partner, Sarah Lee, Senior Practice Development Lawyer or your usual ALG contact.
Date published: 3 December 2025
