The Australian Prudential Regulation Authority (APRA) has notified NobleOak Life Limited (NobleOak) that it is in breach of its prudential and reporting obligations in relation to capital.
APRA has written to the board of NobleOak to formally advise it has breached Prudential Standard LPS 117 Capital Adequacy: Asset Concentration Risk Charge (LPS 117) and Reporting Standard LRS 117.0 Asset Concentration Risk Charge (LRS 117.0). The breaches relate to the measurement and reporting of NobleOak’s reinsurance exposures and the associated asset concentration risk, which have resulted in a breach of capital requirements.
NobleOak’s non-compliance poses no immediate risk to members and policyholders. It is not connected to any recent financial market movements or developments.
In response, NobleOak has advised APRA of its plan for remediating the breach of LPS 117 requirements by 1 July 2023. APRA is satisfied the plan is credible and will monitor NobleOak’s execution of the plan closely over the coming months.
APRA will examine NobleOak’s processes for compliance with its prudential and reporting obligations in the context of its broader risk governance framework to establish the underlying causes of the breaches. APRA will also take action as needed to hold those responsible for the breach to account. The NobleOak board has launched a review of its control processes for complying with APRA’s prudential standards.