APRA, in collaboration with the Reserve Bank of Australia (RBA) and the Australian Bureau of Statistics (ABS), published a letter outlining temporary changes in reporting obligations for authorized deposit-taking institutions and registered financial corporations, in response to COVID-19. The changes include extension of timelines for notifications under Bank Executive Accountability Regime (BEAR), new small and medium enterprises (SME) lending reporting requirements, changes to due dates for quarterly reporting, and deferral of certain new reporting standards and proposals. Additionally, Helen Rowell, the Deputy Chair of APRA, and Danielle Press of the Australian Securities and Investments Commission (ASIC) released a joint letter and a set of frequently asked questions (FAQs) that offer guidance to help superannuation trustees to manage the financial and operational challenges associated with COVID-19.
The temporary changes to reporting obligations, which apply to authorized deposit-taking institutions and registered financial corporations, are effective immediately. The key changes involve:
- Introduction of a new reporting standard for banks regarding lending to small and medium enterprises (SMEs), to support the Commonwealth Government’s COVID-19 SME Guarantee Scheme.
- Early implementation of the November 2019 proposal to standardize reporting due dates for authorized deposit-taking institutions' quarterly forms, only where that represents an extension of due dates, and extending this to registered financial corporations. Forms that were previously due prior to the 35th calendar day will now be due on the 35th calendar day. Forms that were due after the 35th calendar day will continue to be due on the existing due date. Also, APRA, in consultation with the ABS and RBA, decided to not grant any further blanket extensions to reporting due dates, nor to relax the governance requirements applying to reporting to APRA.
- Deferral of the introduction of certain new reporting standards until the March 2021 reporting period. Given the current operating environment, the agencies deferred the implementation of two new reporting standards, including the Reporting Standard ARS 730.1 on ABS/RBA fees charged and the Reporting Standard ARS 722.0 on ABS/RBA derivatives. These reporting standards will now apply to reporting periods ending on or after March 31, 2021. All authorized deposit-taking institutions and registered financial corporations are exempt from reporting for periods prior to this date.
- Deferral of the proposal to determine certain entities' data non-confidential until further notice. In December 2019, APRA had proposed to determine certain data reported by authorized deposit-taking institutions as non-confidential and to seek commentary for publication on significant movements in data. In consideration of the current operating environment, the proposals outlined by APRA have been deferred until further notice.
- Continuation of reporting of data that were required in reporting standards ARS 331.0 on Selected Revenues and Expenses (ARS 331.0); RRS 331.0 on Selected Revenue and Expenses (RRS 331.0); and the ABS Quarterly Business Indicators Survey (QBIS). The due date will be extended to the 40th calendar day after the end of the reporting period, and APRA will accept this reporting on a best endeavors basis.
- Granting a temporary extension of notification period for changes to accountability statements and maps under BEAR. APRA has exercised power under the Banking Act 1959 to replace the 14-day period for notification of changes to accountability statements and maps with a 30-day period. The legislative instrument changing the period will take effect from April 06, 2020. Where changes to statements and maps occurred in the 14 day period prior to March 31, 2020, notification will be accepted by APRA as compliant if provided within 30 days of the change occurring.
- Extension of the query process for monthly reporting. Queries will be sent on the third business day after the due date. Reporting entities will then have three business days to respond to queries. Similar extensions will be granted for quarterly reporting.
The APRA and ASIC letter to registrable superannuation entities highlights that monitoring liquidity is one of the primary areas of regulatory focus over recent weeks to ensure funds retain the means to fulfill their payment obligations, including the early release of superannuation payments recently announced by the government. The following are the key announcements for superannuation sector:
- The Superannuation Data Transformation project will continue, however, there will be a one year deferral for data collections from funds until September 2021.
- APRA will postpone the commencement of thematic activity related to outsourcing and conflicts management until the fourth quarter of 2020.
- Media Release on Reporting Changes
- Letter to Banks
- Media Release on Superannuation
- Letter to Superannuation Entities
- FAQs in Response to COVID-19
Keywords: Asia Pacific, Australia, Banking, Insurance, Pensions, COVID-19, Reporting, BEAR, ARS 730.1, ARS 722.0, SME, EFS, APRA
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
Previous ArticleFSB Outlines and Reprioritizes Its Work to Address COVID-19 Risks
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.