APRA Releases Details of Superannuation Heatmap
APRA released details of the superannuation heatmap that will provide insights into the outcomes being delivered by the registrable superannuation entity (RSE) licensees by providing information for all MySuper products. Delivering an address to the ASFA 2019 conference in Melbourne, APRA Deputy Chair Helen Rowell revealed a sample of the heatmap. APRA also released an information paper that explains how APRA selected the metrics and benchmarks used in the heatmap and the methodology used to take into account differences in products’ investment strategy and asset allocation. The full heatmap is expected to be published on APRA website by mid-December.
The heatmap enables like-for-like comparisons of outcomes and seeks to foster a culture of continuous improvement across the superannuation industry. The heatmap is expected to drive improvements in outcomes for members by holding RSE licensees publicly accountable for their performance and by highlighting areas of under-performance. A heatmap with mock data is also available to illustrate how the heatmap will use a graduating color scheme to provide clear and simple insights into MySuper products across three areas—investment performance, fees and costs, and sustainability of member outcomes. For investment performance and fees and costs, MySuper products delivering outcomes below the relevant benchmarks are depicted from pale yellow to dark red. The sustainability measures provide an indication of a trustee’s ability to provide quality member outcomes in the future and address areas of under-performance.
APRA is integrating the heatmap into its risk assessment and supervisory intensity model, which is aligned with its new enforcement approach. In developing the heatmap, APRA has included metrics that reflect outcomes relative to peers and appropriate benchmarks. APRA will periodically refresh the heatmap to incorporate new data submitted to APRA. As work on assessment of member outcomes evolves, APRA will also develop metrics for insurance, as this is another important component of member outcomes. Having released the information paper, APRA will engage with trustees to ensure that both the heatmap and the APRA expectations for its use are well-understood. This will include meeting with trustees that the heatmap identifies as having clearly under-performing MySuper products and ensuring that these trustees deliver on plans to address this issue in a timely manner.
Keywords: Asia Pacific, Australia, Insurance, Pensions, Superannuation, Heatmap, Mysuper Product, RSE Licensee, APRA
BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks
The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.
DNB Publishes Multiple Reporting Updates for Banks
DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.
NBB Sets Out Climate Risk Expectations, Issues Reporting Updates
The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting
EBA Updates Address Securitization Standards and DGS Guidelines
The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.
FSB Publishes Letter to G20, Sets Out Work Priorities for 2023
The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023