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APRA issues letter to ADIs on scrutiny of securitisation practices

Monday 7 December 2020

The Australian Prudential Regulation Authority (APRA) has announced a review of securitisation practices, following recently identified repurchased residential mortgage loans at some authorised deposit-taking institutions (ADIs) that were subject to repayment deferral from their securitisations. In APRA’s view, this represents implicit support, which is inconsistent with Prudential Standard APS 120 Securitisation.

The letter to ADIs is available on the APRA website at: Scrutiny of securitisation practices.

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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, private health insurers, friendly societies, and most members of the superannuation industry. APRA currently supervises institutions holding $7.9 trillion in assets for Australian depositors, policyholders and superannuation fund members.