Australian Prudential Regulation Authority
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The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the Australian financial services industry.
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[edit] Regulatory scope
APRA oversees banks, credit unions, building societies, friendly societies, general insurance and reinsurance companies, life insurance and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. APRA currently supervises institutions holding approximately $2.2 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.
[edit] History
In June 1996, the Financial System Inquiry (known as the Wallis Inquiry) was established and given the brief to:
- examine the results of the deregulation of the Australian financial system;
- examine the forces driving further change, particularly technological;
- recommend changes to the regulatory system to ensure an 'efficient, responsive, competitive and flexible financial system to underpin stronger economic performance, consistent with financial stability, prudence, integrity and fairness'
At the time the regulators of the Financial Services Industry were based on the institutions and not the regulatory function. APRAs predeccessor regulators were:
- The Insurance and Superannaution Commission.
- The Reserve Bank of Australia
- The Australian Financial Institutions Commission
- The Australian Securities Commission
The Wallis Inquiry recommended a new structure:[1]
the Reserve Bank of Australia (RBA) to deal with Monetary policy and systemic stability with the Payments System Board considering payments systems regulation;
the Australian Prudential Regulation Commission (later to become APRA) to deal with prudential regulation of:
- Deposit taking institutions
- Life and general insurance
- Superannuation (including Industry superannuation);
the Corporations and Financial Services Commission (a renamed and expanded Australian Securities Commission) to deal with:
- market integrity
- consumer protection
- corporations.
APRA was established on 1 July 1998 following the passage of the Australian Prudential Regulation Authority Bill 1998.
APRA became prominent in the collapse of HIH in 2001 and the National Australia Bank foreign currency deal scandal in 2004.
The current chairman of APRA is Dr John Laker and the deputy chairman is Ross Jones.
[edit] Related Legislation
APRA is an independent statutory authority of the Commonwealth Government established under the Australian Prudential Regulation Authority Act 1998
A complete list of legislation that APRA oversees can be found at http://www.apra.gov.au/Legislation
