The financial services industry is one of those areas, like life sciences and technology, where Ireland punches well above its weight.

Over the past four decades, an ever-increasing number of financial institutions have set up operations in Ireland, from major international banks and investment managers to insurers and reinsurers, to fintech and payment companies. Supporting them is an expansive ecosystem of companies providing essential services such as technology support, software development and cybersecurity, anti-money laundering and investor relations services. 

There are now over 430 internationally focused financial services companies operating in Ireland, employing more than 50,000 people between them. The roster includes 17 of the top 20 global banks and 11 of the world’s 15 largest insurance companies. 

Their presence means Ireland has become one of the largest exporters of financial services in the EU and, indeed, the world, according to data from the World Trade Organization.

Established Financial Leaders
Many of these institutions have substantial operations. US banking giant Citi, for example, employs 2,500 people in Ireland, offering services that range from private banking to treasury, trade solutions and securities services. 

State Street, another major American firm, employs a similar number of people to provide financial services to institutional investors, including fund administration services for both domiciled and non-domiciled funds, and custodian services. 

“Ireland’s offering as a leading international financial services hub within the EU continues to appeal to overseas investors looking to service their client base in this market,” says Kieran Donoghue, Global Head of Strategy, Public Policy and International Financial Services at IDA Ireland, the country’s inward investment agency. 

Along with well-established financial services such as deposit-taking, lending, trade finance and capital markets, emerging areas such as blockchain, crypto assets, fintech and artificial intelligence have become increasingly important. In August 2022, Zodia Custody (Ireland)—a subsidiary of Standard Chartered Bank—became the first dedicated crypto asset custodian registered in Ireland. 

“There’s been a lot of activity surrounding crypto assets in Ireland recently,” says Zodia Custody Ireland CEO John Cronin. “We aim to play our part by providing institutions with a safe and secure solution for investing in crypto assets.”

Forging a global reputation
IDA Ireland views Zodia’s investment as a strong reference case for the development of Ireland’s nascent crypto custody sector. The country has a long history of developing market-leading positions in critical parts of the finance industry, including aircraft leasing, fund management and bond issuance. 

Many of the world’s leading financial services companies also have significant R&D operations in Ireland. Mastercard’s European Technology Hub, for example, hosts 1,500 technologists and is investing in emerging technology areas such as AI, cybersecurity, blockchain and virtual reality. Dublin is also home to one of Citi’s Global Innovation Labs, while Fidelity Investments’ FCAT lab provides technology and operational business services to the US in areas such as cloud, cybersecurity, digital assets, AI and the metaverse. Ireland is a thriving technology hub, providing companies with access to high-caliber talent to support the growth of their global R&D and technology operations. 

More than 60% of the world’s leased commercial aircraft are owned or managed from Ireland, for example. And the country is the third-largest funds domicile in the world, servicing more than €5.2 trillion of assets under administration. More than 1,000 fund managers from over 50 countries have assets administered in Ireland, with 17 of the world’s top 20 global asset managers offering Irish-domiciled funds. 

The Irish Stock Exchange—part of the wider Euronext Group, which also has markets in Amsterdam, Brussels, Lisbon and Paris—is a world-leading venue for the listing of funds and structured debt products. The Irish bourse currently lists more than 3,650 bonds and several hundred exchange-traded funds (ETFs), and is Europe’s largest domicile for ETFs. 

All this activity has made Ireland a thriving European financial hub, with expertise and skills that help it stand out from other centers. The authorities have set ambitious targets to further develop the sector, and the government has announced that it wants to turn Ireland into one of the 20 largest global financial centers by 2025. In doing so, it will be helped by the robust regulatory oversight of the Central Bank of Ireland, alongside other assets such as a broad and deep pool of skills and a stable business and political environment. Ireland also offers a highly tax-efficient location, with a 12.5% corporate tax rate and a comprehensive set of double-taxation agreements with more than 60 other jurisdictions.

Fintech trailblazers
Ireland also has a strong record in nurturing its own financial services innovators. Online payment processing giant Stripe was set up in 2010 by two Irish brothers, Patrick and John Collison, and today operates from dual headquarters in Dublin and California. Other success stories include international payments firm TransferMate, revenue-based finance and marketing analytics provider Wayflyer and currency hedging specialist Assure Tech. 

While much of the financial industry is focused in and around the capital, Dublin, and its International Financial Services Centre, more than a third of financial services companies in Ireland are now based outside the capital. 

Cities such as Cork, Galway, Limerick, Kilkenny and Waterford all have thriving financial sectors, and smaller towns are also home to major international players and their subsidiaries. JRI America, for example, a part of Japan Research Institute, the specialist IT division of Sumitomo Mitsui Banking Corporation (SMBC), has offices in Tralee, Co Kerry, in the southwest of Ireland, complementing its offices in New York and New Jersey. JRI’s Tralee Technology Centre also hosts a security operations center (SOC) that works closely with the group’s existing SOC in Japan. 

The wider group has several other entities operating in Ireland, including SMBC Bank EU Dublin, Sumitomo Mitsui Finance and Leasing Company and SMBC Aviation Capital. Another major Japanese bank, Mitsubishi UFJ Financial Group, has a fund services office in the Irish capital. 

Dublin is in a time zone that offers an ideal link between the major financial centers of Asia and New York. As part of the European Union, it also provides a base for banks and other financial services providers to operate across the largest single market in the world.

Reforms to welcome the world
In an effort to further improve its market position, Ireland has shown itself open to enacting regulatory reforms when needed. Ireland’s Investment Limited Partnerships (ILP) Act, for example, came into force in late 2020 and modernized the rules for private equity investors, making the country even more competitive for private investment funds, particularly those based in Asia, the US or other parts of Europe. 

Among those to make use of the new structures now available is fund administration services group Ocorian, which announced in July 2022 that it had been granted three new licenses by the Central Bank of Ireland, covering alternative investment fund management (AIFM) services, fund administration services and real asset depositary services. 

“These licenses will now enable us to offer our clients a wider choice of domicile for their funds within the European Union,” explains Mike Hughes, Ocorian’s Global Head of Service Lines.

Open for growth
The expectation is that more American fund managers will choose to domicile their structures in Ireland in the future, using the country as a base for their wider European operations. 

The Investment Limited Partnerships Act is one of the priorities of the government’s growth strategy for the sector, known as Ireland for Finance, first published in 2019. In the latest iteration of this strategy, announced in early October 2022, the government states its aim to add 5,000 more jobs in the sector by 2026, with a particular focus on growth in sustainable finance, fintech and digital financial services. 

Among the initiatives that form part of the plan are the setting up of an International Sustainable Finance Centre of Excellence, alongside assessing the potential for a climate funding platform in Ireland. 

In the past, Ireland has proved adept at identifying financial services sectors with potential for growth. The country expects that both fintech and sustainable finance will provide a platform for further development, alongside the more established forms of financial activity.

A financial trading powerhouse
Ireland’s financial services exports hit $25.9 billion in 2021—up from $11.5 billion a decade earlier—according to the WTO, making it the sixth-largest provider in the world, behind the likes of the U.S. and Singapore. Ireland outperformed countries with arguably stronger international reputations for banking, such as Switzerland, which exported just over $24 billion that year, and much larger European economies. Its exports were worth almost twice Japan’s $13.6 billion in 2021, ranked 11th globally. Ireland had the fifth-highest global total of imports, just behind the UK. 

These statistics point to a healthy financial services market well integrated into the global economy, and forming part of a diverse trade mix.