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APRA releases superannuation prudential practice guides

Tuesday 10 August 2010

 

The Australian Prudential Regulation Authority (APRA) today released a response paper and prudential practice guides (PPGs) for superannuation trustees in the areas of capital, risk management, adequacy of resources and fitness and propriety.

In August 2009, APRA released for consultation a discussion paper and draft PPGs covering these four areas. The PPGs are intended to assist registrable superannuation entity (RSE) licensees to satisfy licence conditions and operating standards under the Superannuation Industry (Supervision) Act 1993 (SIS Act) and the relevant SIS Regulations.

The final PPGs released today reflect APRA's existing policy position and replace previously issued guidance in these four areas. These PPGs are:

  • Superannuation Prudential Practice Guide – SPG 110 – Capital;
  • Superannuation Prudential Practice Guide – SPG 200 - Risk Management;
  • Superannuation Prudential Practice Guide – SPG 230 - Adequacy of Resources; and
  • Superannuation Prudential Practice Guide – SPG 520 – Fitness and Propriety.

Deputy Chairman Ross Jones said the four PPGs outline what APRA regards as sound practice in these areas of a superannuation trustee's operations.

'The release of this consolidated guidance to superannuation trustees and their directors on capital, risk management, adequacy of resources and fitness and propriety is an important means to assist trustees in meeting their obligations.'

The practices outlined in the four PPGs are not affected by the recommendations of the Super System Review Panel ('Cooper Review') that were released on 5 July 2010.

Draft prudential practice guides on management of conflicts and reserving practices that were also issued for consultation in 2009 will be further reviewed subject to any Government response to the Cooper Review's recommendations on these subjects.

APRA's response paper and each of the four PPGs are available 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.