The Australian Prudential Regulation Authority (APRA) today released a draft Prudential Standard on Business Continuity Management (BCM) for authorised deposit-taking institutions, general insurers and life insurance companies (regulated institutions) for public consultation.

Under the proposed Standard, regulated institutions would be required to:

· identify, assess and manage potential business continuity risks to ensure they can continue to meet their financial and service obligations to depositors and policyholders in the event of a material disruption to business operations; and

· undertake regular reviews of their BCM framework, including periodic testing and maintenance of their business continuity plan.

APRA’s Chairman, Dr John Laker, said APRA has undertaken detailed assessments of regulated institutions’ BCM arrangements for a number of years as part of its regular on-site reviews and has used this experience in formalising prudential requirements in this area.
“As business operations have become increasingly complex and vulnerable to disruption from external events, effective BCM has become an essential component of a regulated institution’s risk management framework,” said Dr Laker.

He added, “The proposed standard will ensure all regulated institutions adequately address their business continuity risks on an ongoing basis.”

Comment on the draft standard is invited by 30 September 2004.
A copy of the standard is available on the APRA website at: http://www.apra.gov.au/Policy/Draft-Prudential-Standards-Business-Continuity-Management.cfm

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry.
It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry.APRA is funded largely by the industries that it supervises.
It was established on 1 July 1998.APRA currently supervises institutions holding approximately $1.8 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.