October 17, 2018

APRA released an information paper to assist authorized deposit-taking institutions to meet their obligations under the Banking Executive Accountability Regime (BEAR). BEAR, which establishes heightened standards of accountability among deposit-taking institutions and their most senior executives and directors, came into force for the largest banks from July 01, 2018. It will apply to all other authorized deposit-taking institutions from July 01, 2019.

BEAR was established under legislation and is administered and enforced by APRA. The information paper, based on the experience of APRA in implementing the regime for the largest banks, is intended to assist all other authorized deposit-taking institutions to prepare to implement BEAR and to helping the largest authorized deposit-taking institutions refine and embed the regime. It clarifies expectations about of how an authorized deposit-taking institution can effectively implement the accountability regime on matters including the following:

  • Identifying and registering accountable persons

  • Creating and submitting an accountability statement for each accountable person and an accountability map for the authorized deposit-taking institution

  • Establishing a remuneration policy requiring that a portion of accountable persons’ variable remuneration be deferred for a minimum of four years and reduced commensurate with any failure to meet their obligations

  • Notifying APRA of any accountability-related changes or breaches of accountability obligations

The information paper also includes questions and answers based on some of the issues commonly raised by authorized deposit-taking institutions during implementation. APRA will address enforcement-related issues, including the disqualification of accountable persons and civil penalties under the BEAR, in a subsequent paper.
 

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Keywords: Asia Pacific, Australia, Banking, BEAR, Governance, Accountability Regime, APRA

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