APRA Publishes Policy and Supervisory Priorities for 2020
APRA has set out its policy and supervision priorities for the next 12 to 18 months, with an emphasis on fulfilling the strategic goals of its Corporate Plan. These goals are maintaining financial system resilience, improving outcomes for superannuation members, improving cyber-resilience in the financial sector, and transforming governance, culture, remuneration, and accountability (GCRA) across all APRA-regulated institutions. Additionally, while speaking at the Chair Forum of the Investment Magazine, the APRA Deputy Chair Helen Rowell presented the policy and supervisory agenda for superannuation sector in 2020.
Consistent with the previous years, the policy priorities of APRA offer a forward view of planned changes to the prudential framework. Among the key cross-industry policy priorities for 2020 are initiatives aimed at driving improvements in GCRA, including finalizing a more robust prudential standard on remuneration, and updating prudential standards on governance and risk management. Additionally, as flagged in the APRA Insight last month, APRA intends to roll out a new prudential risk rating system to replace its long-standing Probability and Impact Rating System and Supervisory Oversight and Response System (also known as PAIRS and SOARS models) mid-year. APRA will also work closely with the Treasury and the Australian Securities and Investments Commission in expanding the Banking Executive Accountability Regime (BEAR) to the insurance and superannuation sectors. The other key policy priorities include the following:
- Strengthening crisis preparedness, including the development of a new prudential standard on resolution and recovery planning
- Completing the current review of the capital framework for authorized deposit-taking institutions to implement unquestionably strong capital ratios and the Basel III reforms
- Progressing a range of enhancements recommended by the post-implementation review of the original superannuation prudential framework introduced in 2013
- Continuing work on strengthening the capital framework for private health insurers
Accompanying the policy priorities are the supervision priorities of APRA, which outline how the supervision function will be directed toward significant risks in the financial system and actions to ensure that these risks are well-managed and mitigated. In the supervision arena, the following are the key priorities for 2020:
- Maintaining financial resilience, including through increased focus on recovery and resolution planning and stress testing
- Conducting a range of GCRA-related supervisory reviews and deep dives and using entity self-assessments to drive greater accountability
- Encouraging under-performing superannuation funds to urgently improve member outcomes or exit the industry
- More closely assessing institutions’ capability to deal with emerging and accelerating risks, such as cyber-security and climate change
Related Links
Keywords: Asia Pacific, Australia, Banking, Insurance, Pensions, Superannuation, Policy Priorities 2020, Supervision Priorities 2020, GCRA, Corporate Plan, Basel III, BEAR, Resolution Framework, Operational Risk, APRA
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
UK Authorities Update on Transition to Post-Exit Rules and StandardsNext Article
ISDA Publishes First Issue of ISDA Quarterly in 2020Related Articles
UK Government to Set Out Rules on Wind-down of Critical Benchmarks
HM Treasury notified that, after considering all responses, the government intends to bring forward further legislation, when the Parliamentary time allows, to address issues identified in the consultation on supporting the wind-down of critical benchmarks.
EIOPA Launches Stress Test for Insurance Sector in EU
EIOPA launched the 2021 stress test for the insurance sector in EU.
UK Authorities Publish Third Edition of Regulatory Initiatives Grid
UK authorities jointly published the third edition of Regulatory Initiatives Grid setting out the planned regulatory initiatives for the next 24 months.
EC Consults on Regulation on Non-Financial Sustainability Disclosures
EC is requesting feedback on the proposed Commission Delegated Regulation on the content, methodology, and presentation of information that large financial and non-financial undertakings should disclose about their environmentally sustainable economic activities under the Taxonomy Regulation.
OSFI Outlines Prudential Policy Priorities for Coming Months
OSFI has set out the near-term priorities for federally regulated financial institutions and federally regulated private pension plans for the coming months until March 31, 2022.
BIS Announces TechSprint on Innovative Green Finance Solutions
Under the Italian G20 Presidency, BIS Innovation Hub and the Italian central bank BDI launched the second edition of the G20 TechSprint on the lookout for innovative solutions to resolve operational problems in green and sustainable finance.
ACPR Publishes Version 1.0.0 of RUBA Taxonomy
ACPR published Version 1.0.0 of the RUBA taxonomy, which will come into force from the decree of January 31, 2022.
EBA Proposed Regulatory Standards for Central Database on AML/CFT
EBA proposed the regulatory technical standards on a central database on anti-money laundering and countering the financing of terrorism (AML/CFT) in EU.
ECB Responds to EC Consultation on Crisis Management Framework
ECB published its response to the targeted EC consultation on the review of the bank crisis management and deposit insurance framework in EU.
BCBS, CPMI, and IOSCO to Survey Market Participants on Margin Calls
BCBS, CPMI, and IOSCO (the Committees) are inviting entities that participate in market infrastructures and securities markets through an intermediary as well as non-bank intermediaries to complete voluntary surveys on the use of margin calls.
