Amendment bill seeks to increase APRA powers
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The Financial Sector Legislation Amendment (Prudential Refinements and Other Measures) Bill 2010 is aimed at enhancing the powers of the Australian Prudential Regulation Authority (APRA).
The proposed amendment bill was released for public consultation yesterday by the Minister for Financial Services, Superannuation and Corporate Law, Chris Bowen.
He stated that it would further enhance APRA’s ability to regulate bodies in the financial sector in accordance with prudential laws, consistent with developments in other countries that have sought to strengthen their financial regulatory frameworks, such as the UK and the US.
“The Government is committed to ensuring Australia has a regulatory framework that is risk based, consultative and consistent with international best practice,” Bowen said.
The changes are aimed at enhancing APRA’s power to investigate and detect risks to prudentially regulated institutions and the financial system and to promote financial system stability, as well as compel compliance with, and rectify breaches of, prudential requirements, act when regulated financial institutions are at risk of experiencing financial distress and ensure that distress is resolved without undermining financial stability.
The amended legislation will also enable APRA to administer the financial claims scheme, which protects deposits in Australian banks, credit unions and building societies (currently up to a limit of $1 million per depositor) and eligible policyholders of general insurers, and collect data that APRA or the Government requires to identify and respond to developments in the financial sector.
The Government is also moving to make the amendments to the financial sector levies frameworks that were recommended by the 2009 Report of the Review of Financial Sector Levies.
Submissions close on March 16, 2010.
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