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APRA releases draft prudential practice guides for superannuation

Tuesday 11 December 2012


The Australian Prudential Regulation Authority (APRA) has today released for consultation a discussion paper and 10 draft prudential practice guides (PPGs) for the superannuation industry.

This year APRA has consulted extensively with industry and other stakeholders during the development of its prudential standards for superannuation and the MySuper authorisation process. The material released today responds to a number of guidance-related matters that were raised in submissions during this consultation.

The 10 draft PPGs include practical guidance on matters that a registrable superannuation entity licensee (RSE licensee) may consider to assist it in meeting the requirements in APRA’s prudential standards. APRA has drafted the superannuation PPGs to align where appropriate with guidance in other APRA-regulated industries.

APRA Deputy Chairman Ross Jones said that the draft PPGs will assist in the implementation of APRA’s prudential standards and help strengthen the superannuation system.

‘This guidance will not only provide practical support to RSE licensees in meeting the requirements of the prudential standards, but will also encourage the further development of good practice,’ Mr Jones said.

The 10 draft PPGs released today focus on areas APRA considers to be most important for MySuper authorisation and also include draft PPGs that relate to core elements of the prudential framework.

The draft PPGs are:

  • Prudential Practice Guide SPG 114 Operational Risk Financial Requirement;
  • Prudential Practice Guide SPG 220 Risk Management;
  • Prudential Practice Guide SPG 231 Outsourcing;
  • Prudential Practice Guide SPG 232 Business Continuity Management;
  • Prudential Practice Guide SPG 250 Insurance in Superannuation;
  • Prudential Practice Guide SPG 510 Governance;
  • Prudential Practice Guide SPG 520 Fit and Proper;
  • Prudential Practice Guide SPG 521 Conflicts of Interest;
  • Prudential Practice Guide SPG 530 Investment Strategy – Formulation; and
  • Prudential Practice Guide SPG 531 Investment Strategy – Implementation.

A second set of draft PPGs will be released for consultation in the second quarter of 2013.

The discussion paper and draft PPGs can be found on the APRA website.

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 $6 trillion in assets for Australian depositors, policyholders and superannuation fund members.