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APRA releases final prudential standard for Financial Claims Scheme

Monday 24 June 2013

 

The Australian Prudential Regulation Authority (APRA) has today released a response paper on the Financial Claims Scheme (FCS) for locally incorporated authorised deposit-taking institutions (ADIs), as well as the final version of Prudential Standard APS 910 Financial Claims Scheme (APS 910).

The response paper addresses submissions received in relation to APRA’s November 2012 consultation package on the Financial Claims Scheme.

The Financial Claims Scheme, established in October 2008, is designed to protect depositors (up to a defined amount of $250,000 per account holder per ADI) and to provide them with timely access to their deposits in the event that their ADI becomes insolvent and is declared by the Treasurer to be subject to the FCS.

Under APS 910, ADIs are required to be operationally ready to meet payment, reporting and communications requirements should they be declared under the FCS. There are also requirements under APS 910 for ADIs to be able to produce a ‘single customer view’ for each account holder to facilitate fast payment under the FCS.

In the coming weeks, APRA will also release a final information paper and technical guidance on payment and reporting to assist ADIs to comply with the payment and reporting requirements under APS 910.

The payment, reporting and communications requirements under APS 910 will take effect from 1 July 2013 and ADIs have 12 months to comply with the new requirements. The commencement date for existing FCS requirements relating to the single customer view remains 1 January 2014.

APRA may grant an extended transition period on application by an ADI. Lodgements of such applications are expected three months prior to the relevant compliance date to allow sufficient time for APRA to consider and approve an extension.

The final APS 910 can be found on the APRA website: Financial Claims Scheme for ADIs

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.