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APRA-regulated businesses operating in the banking, insurance, and superannuation industries will soon be faced with significant regulatory changes. APRA and the ASIC have commenced early consultation around the introduction of the Financial Accountability Regime, which aims to establish a strong accountability framework to enhance risk management and governance practices in the financial sector.

Following industry consultation released late last year APRA recently finalised revisions to Prudential Standard APS 220 Credit Risk management, effective September 2022, to include a new Attachment C - Macroprudential policy: credit measures. Under the new requirements, ADIs must be operationally prepared to implement certain macroprudential policy measures, if needed to avoid potential barriers to timely and effective implementation.

Last week, APRA Deputy Chair John Lonsdale delivered a speech at the COBA CEO and Director Forum. Reflecting on the history of the mutual banking sector, Lonsdale highlighted APRA’s recent review of mutuals exiting the industry and their performance 12 months prior to their exit. It brought to the fore several issues that could lead to potential future mutual exits, such as poor performance on cost management, lending growth and profitability. APRA highlighted three core priorities to “support a strong, stable mutual sector”, being: • Cyber risk, including CPS 234 reviews • Risk culture • Contingency and continuity frameworks

On Thursday 11 November 2021, APRA announced its proposed new attachment to Prudential Standard APS 220 Credit Risk Management.

While auditing risk culture is still a relatively new concept for most organisations, it’s an area that is receiving increased focus.