Navigating a Central Bank Risk Mitigation Programme: A Practical Guide

The Central Bank of Ireland (Central Bank) takes an outcome focused, risk-based approach to supervision as outlined in their “Our Approach to Supervision”, which was published alongside its Regulatory & Supervisory Outlook Report 2025. 

RMP’s are part of the Central Bank’s Supervisory Toolkit and may be used as an intervention arising from their supervision. 

If you are a Board Chair, CEO, or other senior executive who has received a RMP you may be trying to understand how to respond effectively which is critical, not only to meet regulatory expectations but also to safeguard your organisations reputation and resilience.  

Drawing on years of experience advising boards and executive teams, we’ve developed a practical framework to help leaders like you navigate the RMP process with confidence and clarity.  In this article, I’ll outline key steps to take, common pitfalls to avoid, and how to turn regulatory scrutiny into an opportunity for strengthening governance and risk management.  

Why is Supervision necessary?  

Financial regulation is important and necessary, but, on its own, it is not enough to protect members, consumers and investors, keep firms safe and stable, maintain trust in the financial system, and support overall financial stability, i.e. the Central Bank’s Safeguarding Outcomes.    

That’s why supervision is also essential.  Supervision means the Central Bank will actively work with financial firms, analysing their activities and keeping a close watch to make sure that regulations are followed and risks are mitigated.  This approach ensures that not only are regulations put into practice, but the support is there to check that they are working as intended, and action is taken when they are not.  

By taking an outcome focused, risk-based approach the Central Bank can communicate its supervisory concerns to sectors and firms and highlight the outcomes expected and the timelines for them to be achieved.    

Why does the Central Bank issue a Risk Mitigation Programme (RMP)?  

If a firm is found to have issues or concerns in high-risk areas, for example, poor governance, weak financial controls, or inadequate third-party risk management, the Central Bank may issue a Risk Mitigation Programme (RMP).  A RMP is a formal set of actions a regulated firm must take to fix those issues. It includes:  

• What needs to be done.  

• Who is responsible.  

• When it must be completed.  

This helps ensure the firm:  

• Protects its members, customers and investors.  

• Stays financially sound.  

• Maintains trust in the financial system.  

• Supports overall financial stability.  

When might an RMP be issued?  

A RMP may be issued:  

• After a supervisory review or inspection.  

• If the firm’s regulatory risk profile increases.  

• When there are concerns about compliance, resilience or governance.  

• If the firm’s actions could impact on the wider financial system.  

How to respond to the Central Bank’s Risk Mitigation Programme?  

Outcome focused and risk-based supervision remains fundamental to the Central Bank’s approach and any supervisory concerns will be communicated to sectors and firms.  This may take the form of, for example, a ‘Dear CEO/Chair” letter, issuance of a risk mitigation programme (RMP) requiring a firm to prepare a skilled report, or at the higher end of the Central Bank’s escalation toolkit, the utilisation of direction-making powers, including enforcement actions.  Firms must ensure they take appropriate risk mitigation actions to address the issues identified and the desired outcomes expected. Set out below is a practical framework to help you navigate the RMP process:   

1. Carefully review the RMP letter – it will outline the specific weaknesses identified, the required actions, desired outcomes and the deadlines.  
2. Engage and Clarify – if you are unclear about any part of the RMP, engage your Central Bank supervisor for clarification.   
3. Conduct a Gap Analysis – compare the Central Bank’s expectations with your current frameworks, policies and practices. Focus on the Central Bank’s identified weaknesses and desired outcomes in addition to regulatory requirements, guidance and best practices. 
4. Identify areas where your firm falls short and need enhancement.  
   • Develop a comprehensive remediation plan.  
   • Assign responsibilities.  
   • Board – Clearly communicate to the Board what their responsibilities are in respect of the RMP.  
   • Project Manager – assign a project manager responsible for planning, executing and closing the project considering the weaknesses identified, regulatory compliance. requirements, the Central Bank’s expected outcomes together with internal and external timelines.  
   • Action Owners – ensure detailed actions have a clear owner within the business to drive the remediation actions in line with desired outcomes.  
5. Set internal deadlines – that will ensure that internal reviews and reporting requirements are met in advance of the Central Bank’s deadlines to allow for review and adjustments.
6. Document everything – maintain a clear audit trail of decisions, actions and communications.  
7. Ensure the issues and concerns – identified by the Central Bank in the RMP letter are appropriately strengthened via the remediation actions identified in your plan and are aligned with regulatory requirements and the Central Bank’s desired outcomes.  
8. Develop a comprehensive remediation project management cadence: 
   • Ensure there are internal structures for progressing the remediation plan including regular project touch points and regular internal progress reporting.
   • Provide regular updates to the Central Bank on progress and where required submit evidence of the remediation progress which may include, for example, evidence of updates to policies, training records, system changes or audit results.  
   • Should you hit a roadblock or need more time, communicate early and clearly with the Central Bank.  Be transparent about challenges or delays and propose realistic solutions.  Transparency builds trust.  
   • Make sure responses are well-supported, accurate and aligned with regulatory expectations.  
9. Embed the Central Bank’s desired outcomes – into your systems and controls and ensure it is aligned with identified weaknesses, regulatory requirements, guidance, best practices and the Central Bank’s desired outcome. 
10. Be prepared for a follow-up. The Central Bank may undertake a follow-up inspection or request additional documentation.  
11. Be ready to demonstrate – how changes have been embedded and made operational in addition to how they are monitored and overseen to reinforce the changes and avoid further risk

If you are a Board Chair, CEO or other senior executive who has received a RMP and would like to talk through how you can best organise your team to respond to it, I’m happy to have a conversation with you, on a no obligations basis, to help guide you on those first steps.  

Feel free to reach out directly my contact details are as follows: Carina Myles on +353 1 293346 or carina.myles@eisneramper.ie  

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