The Central Bank has reprimanded and fined Bank of Montreal Ireland a total of €1,246,189 for breaching a condition of its banking licence.
The Central Bank said that Bank of Montreal Ireland failed to submit three operational risk returns to it.
The bank also failed to establish and maintain effective processes and internal controls to ensure compliance with the regulatory reporting condition.
Bank of Montreal Ireland admitted to the breaches in full and the fine - its second for deficiencies in regulatory reporting - was reduced from a potential €1.78m as a result, the Central Bank said.
In October 2015, Bank of Montreal Ireland told the Central Bank that it had failed to submit three operational risk reports - a breach of its licence.
The breach was identified by the firm through an internal audit of its Operational Risk Management function.
The Central Bank said the audit identified not only the failure to report on three occasions, but also failures to implement the procedures and controls necessary to comply with the licence condition.
The Central Bank then started an enforcement investigation into the circumstances surrounding these failures.
Its investigation found that from August 2013 to October 2015, Bank of Montreal Ireland did not have adequate processes and controls in place to ensure that it submitted operational risk reports as required by the licence condition.
It also found that the bank had an inadequate informal process of email diary reminders to alert the relevant employees of upcoming reporting submission dates.
It said the diary reminders were time-limited, with the final diary reminder set for November 2014.
The diary reminders were not renewed after this point with the result that Bank of Montreal Ireland failed to submit the returns.
The Central Bank's investigation also found that the Bank of Montreal Ireland had placed undue reliance on a Bank of Montreal group policy, which was not adapted at local level to ensure that the necessary processes were in place to comply with the licence condition.
Seána Cunningham, the Central Bank's Director of Enforcement and Anti Money Laundering, said that all firms operating in Ireland must do so in line with their regulatory licence, and all conditions attaching to it.
"Compliance with licence conditions is not optional, and breaches are treated seriously by the Central Bank as demonstrated in this enforcement action against the firm," Ms Cunningham said.
The Central Bank's Director of Enforcement and Anti Money Laundering said that the licence breach in this case centres on the bank's failure to submit three operational risk returns.
"As the risks facing the financial sector continue to grow and become more complex, it is essential that the Central Bank has a clear line of sight to any potential risks, including operational risks, within regulated firms to ensure effective supervision and to assess the resilience and integrity of all firms and the financial sector as a whole," she stated.
"All firms must ensure the highest standards in identifying, properly managing and monitoring, and reporting on its operational risks in line with the Central Bank's requirements," she added.
The Central Bank said today that it was satisfied that the Bank of Montreal Ireland had taken "the necessary steps" to rectify the failings that gave rise to the breaches.
It also confirms that the investigation is now closed.
This is the Central Bank's 127th settlement since 2006 under its Administrative Sanctions Procedure, bringing total fines imposed by it to over €70m.