The Australian Prudential Regulation Authority (APRA) has today released an information paper and prudential practice guide (PPG) to assist APRA-regulated institutions with their planning for a potential pandemic.

The advice is being released following consultation with industry and research into pandemic planning that is taking place around the world. While APRA's existing prudential standards cover business continuity planning requirements in the event of a major event or crisis, APRA's pandemic advice is designed to bring into focus specific planning for a pandemic scenario.

While not wanting to overstate the likelihood of a pandemic occurring in Australia, APRA's interest is in ensuring that regulated institutions have conducted prudent and reasonable planning to meet core obligations to depositors, policyholders and other beneficiaries.

APRA Chairman John Laker said APRA believes that many financial institutions are already taking seriously the risk of a pandemic by updating their business continuity plans and reviewing financial exposures, although there remains work to do to ensure the Australian financial sector is as prepared as is practically possible.

"Global developments with respect to the spread of avian influenza have raised concerns about the risk of a human influenza pandemic," Dr Laker said. "The World Health Organisation, the Australian Government and other authorities have issued guides and plans that outline measures to prepare for and manage the risk of an influenza pandemic."

APRA has been working on pandemic planning in recent months with larger institutions, industry associations, other financial regulators and the Government. The focus has been on highlighting good practice, identifying industry-level issues and assessing potential financial impacts on regulated institutions.

The documents released today do not impose any mandatory requirements on institutions but are intended to highlight and support the need to consider this emerging risk. APRA assesses pandemic continuity planning as part of its routine operational risk reviews. APRA is also currently conducting a survey of pandemic exposures across the life and general insurance industries to gauge the potential impact of a pandemic on these industries.

The pandemic information paper and PPG are located on the APRA website at: www.apra.gov.au

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 $2.5 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.

Media and industry inquiries only:
Stuart Snell, Head of Public Affairs
Australian Prudential Regulation Authority
Telephone: 02 9210 3384
Mobile: 0407 250 276

All other inquiries:
APRA Contact Centre
1300 131 060