Equity Associations (PDF, 13kb)
Large Exposures (PDF, 12kb)

The Australian Prudential Regulation Authority (APRA) today released for industry comment two draft prudential standards - Large Exposures and Equity Associations - for all Authorised Deposit-taking Institutions (ADIs). When finalised, these standards will replace the Prudential Statement on the Supervision of Banks Large Credit Exposures (PS E1), the Prudential Statement on Banks Association with Non-Banks (PS G1) for banks, and the FI Scheme Prudential Standards on Managing Credit Risk and Large Exposures, and Subsidiaries for building societies and credit unions.

APRA is currently conducting a broad review of intra-group and group exposure limits in the course of finalising its approach to the supervision of conglomerates. When that review is complete, new prudential standards on large exposures and equity associations will be formulated to give effect to the conglomerate policy framework. This means that todays draft standards will only be interim when they come into effect.

Reflecting the interim nature, APRA has tried to maintain status quo in the drafts to the extent possible. In the case of large exposures, some changes in the reporting and prior notification thresholds for large exposures and exceptionally large exposures are necessary to achieve harmonisation between banks and other ADIs.

The draft standards on Large Exposures and Equity Associations, as well as PS E1, PS G1 and the FI Scheme Prudential Standards, are available on the APRA website, www.apra.gov.au.

Comments are invited on the proposed standards by 26 June 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.exposures@apra.gov.au

For further information, contact:

Gloria Peterson
Public Affairs Manager
02 9210 3385