Central Bank urged to clarify Israeli bond position

The Central Bank of Ireland is under pressure to clarify the role it plays in approving Israeli state bonds after Luxembourg decided not to renew its authorization. Luxembourg had been responsible for the approval since September 2025, but its role expired at midnight. With Luxembourg no longer in charge, Israel now needs another country to take over this responsibility to facilitate borrowing from European investors.

The Central Bank has not confirmed whether it will assume the role again, only stating that the arrangement between Israel and the Luxembourg financial regulator, the CSSF, has ended. The Bank of Ireland would have needed to submit a prospectus application to Ireland by the end of August. The prospectus approved by the CSSF expired today, according to a Central Bank spokesperson.

This situation has come under scrutiny following a statement by the Governor of the Central Bank of Ireland, Gabriel Makhlouf, who assured the Oireachtas Finance Committee that his institution had acted lawfully in the handling of these controversial bonds. However, he did not believe he could prevent the issuance of new bonds this year.

Sinn Féin's Mairéad Farrell urged the Central Bank for urgent clarification about the bonds' renewal, emphasizing that Ireland should not be involved in funding the conflict in Gaza. She argued that the Central Bank should not renew the prospectus and should not continue to be the home state for these bonds.

The Government has been criticized for its inaction on this issue over the past year, with Sinn Féin bringing forward legislation in May to prevent Ireland from dealing with the bonds. Although the motion was defeated in the Dáil, two Independent TDs supported the Coalition's position. Tánaiste and Finance Minister Simon Harris had directed officials to engage with the European Commission on the matter.