Section 4, The Banking Act, 2000

(1) The applicant will conduct its business in a prudent manner. (2) An applicant shall not be regarded as conducting its business in a prudent manner unless it maintains or will maintain net assets which, together with other financial resources available to the applicant are of such nature and amount as are considered appropriate by the Central Bank and are— (a) of an amount which is commensurate with the nature and scale of the applicant's operation; and (b) of an amount and nature sufficient to safeguard the interests of its depositors and potential depositors, having regard to the factors mentioned in subparagraph (3) and any other factors appearing to the Central Bank to be relevant. (3) The factors referred to in subparagraph (2) (b) are— (a) the nature and scale of the applicant's operations; and (b) the risks inherent in those operations and in the operations of any other organisations related to the applicant so far as is capable of affecting the applicant. (4) An applicant shall not be regarded as conducting its business in a prudent manner unless it maintains or will maintain adequate liquidity, having regard to the relationship between its liquid assets and its actual and contingent liabilities, to the times at which those liabilities will or may fall due and its assets mature. 60 No. 10 Banking Act 2000 (5) For the purposes of subparagraph (4), the Central Bank may, to such extent as it thinks appropriate, take into account as liquid assets, assets of the applicant and facilities available to it which are capable of providing liquidity within a reasonable period. (6) An applicant shall not be regarded as conducting its business in a prudent manner unless it makes or, will make adequate provision for— (a) depreciation or diminution in the value of its assets (including provision for [illegible] or doubtful debts), and (b) liabilities which will or may fall to be discharged by it and for losses which it will or may incur. (7) An applicant or institution shall not be regarded as conducting its business in a prudent manner unless it maintain or will maintain adequate systems of control of its business and records. (8) The systems and records shall not be regarded as adequate unless they are such as to enable the business of the applicant to be prudently managed and the applicant to comply with the duties imposed on it under this Act; and in determining whether those systems are adequate the Central Bank shall have regard to the functions and responsibilities in respect of them, of the directors of the applicant. (9) For the purposes of this paragraph "net assets", in relation to a company, means paid-up capital and reserves. INTEGRITY AND SKILL