The Australian Prudential Regulation Authority (APRA) today released for industry comment a draft prudential standard on Capital Adequacy: Market Risk for all Authorised Deposit-taking Institutions (ADIs). This is one of a number of harmonised standards covering capital adequacy (and other prudential requirements), and will be followed shortly by the others.

The draft standard released today seeks to ensure that all ADIs engaged in activities that give rise to risks associated with potential movements in market prices adopt management practices and hold capital commensurate with the risks involved. The standard is based on the Prudential Statement on Market Risk (PS C3), which will be replaced.

The draft Capital Adequacy: Market Risk standard, and accompanying guidance notes, as well as PS C3, are available on the APRA website, www.apra.gov.au.

Comments are invited on the proposed Capital Adequacy: Market Risk standard and guidance notes by 30 April 2000, and may be addressed to:

Mr Brian Gray
Executive General Manager
Policy, Research and Consulting
Australian Prudential Regulation Authority
GPO Box 9836
Sydney NSW 2001
Alternatively email ADIstandards.marketrisk@apra.gov.au