The Chief Executive Officer of the Australian Prudential Regulation Authority (APRA), Mr Graeme Thompson, today noted the release of Justice Neville Owens report to the Government on his findings into the collapse of the HIH Insurance Group.
The Report represents a comprehensive examination of the events that led to the demise of the insurer and APRA will be giving full consideration to findings that have been made in relation to its supervision of HIH, he said.
Mr Thompson also noted the Commissioners recommendations for further reforms to protect the interests of policyholders.
The Government will be considering future policy for the prudential supervision of the insurance industry and APRA looks forward to assisting in this endeavour, Mr Thompson said. A number of Justice Owens recommendations were advocated by APRA in its submissions to the Commission last year and some of these are already being implemented.
While welcoming the Commissioners conclusion that APRA did not cause or contribute to the collapse of HIH, Mr Thompson acknowledged findings that the way in which it exercised its powers and responsibilities in relation to HIH fell short of community expectations.
Many of the shortcomings identified in the supervision of HIH in 1999 and 2000 have been conceded by APRA in its submissions to the Commission and in other public statements over the past couple of years. Most importantly, however, remedial changes have already been made in many areas and this has also been recognised in the Report.
Mr Thompson added: APRA also acknowledges Justice Owens recognition of APRAs candid and open approach to assisting the Commission during the course of the hearings.
APRA will not be making further public comment on the contents of the Report at this point.
APRA is the prudential regulator of the financial services industry including banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry. It currently regulates $1.5 trillion in assets for 20 million Australians.
