APRA Consults on its Approach to Product Responsibility Under BEAR
APRA proposed an approach to implementing the end-to-end product responsibility for authorized deposit-taking institutions under the Banking Executive Accountability Regime (BEAR). The proposal aims to enhance customer experience and outcomes by addressing recommendation 1.17 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. The consultation on the proposed measures ends on August 23, 2019 and APRA expects to implement the new requirements by July 01, 2020. APRA aims to release a draft schedule, with the proposed product responsibility requirements, for further consultation in October 2019 and the final legislative instrument in December 2019.
APRA has addressed a consultation letter to authorized deposit-taking institutions, detailing how it intends to achieve heightened and clarified product accountability among senior executives. The letter requests feedback on four key considerations related to implementing the proposed product responsibility requirements: the scope of accountability, product coverage, the structure of the legal mechanism, and the application of joint accountability in authorized deposit-taking institutions and authorized deposit-taking institutions groups. Although the requirements directly apply to the locally incorporated authorized deposit-taking institutions, APRA strongly encourages all authorized deposit-taking institutions to consider the elements of strengthened product accountability as they relate to their accountable persons, along with the accountability statements and map. Given the Government announcement that the BEAR will be extended to insurers and Registrable Superannuation Entity licensees, all APRA-regulated entities may have an interest in providing feedback on the proposed approach.
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Comment Due Date: August 23, 2019
Effective Date: July 01, 2020 (Proposed)
Keywords: Asia Pacific, Australia, Banking, Insurance, Pensions, Superannuation, BEAR, Operational Risk, Accountability Regime, APRA
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