The Department of Finance has said the main conclusion of its review on the regulation of bank charges is that it would not be appropriate to make any changes at this point in time.

To this end, the department said it would repeal Section 149 of the Consumer Credit Action 1995.

Section 149 requires financial institutions to seek approval for any increases in fees and charges and for the introduction of new charges.

The department's review fulfils one of the commitments given to the Troika.

The review was based on consultations with stakeholders including the Central Bank, AIB, Bank of Ireland, the Irish Banking Federation, the National Consumer Agency, the Competition Authority and ISME.

In a statement, the department said the lack of competition in the banking sector means that the removal of section 149 would "give unfettered price setting power to the incumbent banks".

But it added that conclusion should be revisited when competition in the banking sector has improved.

It also found that it was too early to say whether the recent changes in legislation have been successful in attracting new entrants to the Irish banking sector, and that section 149 does appear to exert a restraining effect on the development of innovative products by the existing banks in Ireland, this may not be to the detriment of consumers.

ISME, the Irish Small & Medium Enterprise Association, welcomed today's news after it had voiced concerns repealing section 149 would lead to crippling bank increases for SMEs.

"Section 149 is an important protection for SMEs against the bailed out Irish banks' tendency to increase charges to buttress their profits on the backs of vulnerable SMEs," commented ISME's chief executive Mark Fielding.