Proposed revisions to the credit risk management framework for authorised deposit-taking institutions
This page contains APRA's consultation on proposed revisions to the credit risk management framework for authorised deposit-taking institutions.
June 2022
On 14 June 2022, APRA released the finalised amendments to its prudential framework to give effect to macroprudential policy measures, following consultation with industry participants late last year.
Under the new requirements, ADIs must be operationally prepared to implement certain macroprudential policy measures, if needed. In particular, banks will need to have systems in place to limit growth in higher risk residential mortgage lending, such as loans at high debt-to-income multiples or high loan-to-valuation ratios.
The new requirements take effect from September this year.
Media release: APRA finalises its macroprudential policy framework.
The letter to industry, marked up and final versions of the standards and guide, and the non-confidential submissions can be found below:
Letter
Macroprudential Policy credit measures
Standards and guide
Published 14 June 2022 | Published 14 June 2022 |
Published 14 June 2022 | Published 14 June 2022 |
Published 14 June 2022 | Published 14 June 2022 |
Non-confidential submissions
November 2021
On 11 November 2021, APRA released for consultation its proposed new attachment to Prudential Standard APS 220 Credit Risk Management. Written submissions on the proposed new attachment, Macroprudential policy: credit measures, should be sent by 28 February 2022.
The letter to industry is available below:
Letter
Macroprudential policy: consultation
August 2021
On 30 August 2021, APRA released a response to submissions on the implementation of Reporting Standard ARS 220.0 Credit Quality, as well as the consequential changes to authorised deposit-taking institutions (ADIs) reporting standards affected by the implementation of the new Prudential Standard APS 220 Credit Risk Management.
The response letter, reporting standards and non-confidential submissions are available below:
Letter
Reporting Standards
Non-confidential submissions
August 2021
On 19 August 2021, APRA released a response to submissions and final revised Prudential Practice Guide APG 220 Credit Risk Management (APG 220). APG 220 provides guidance on sound practice to support Prudential Standard APS 220 Credit Risk Management. APRA’s response to submissions and final revised APG 220 are available below.
Letter
Letter to authorised deposit-taking institutions: Guidance on Credit Risk Management
Practice Guide
APRA received three non-confidential submissions to its December 2019 consultation, which are also available below.
Non-confidential submissions
June 2021
On 8 June 2021, APRA released a response to submissions on Reporting Standard ARS 220.0 Credit Exposures and Provisions and draft interim Reporting Standard ARS 220.0 Credit Quality for consultation, as well as a consultation on consequential changes to authorised deposit-taking institution (ADI) reporting standards affected by implementation of the new Prudential Standard APS 220 Credit Risk Management.
Written submissions on the interim and updated ADI reporting standards should be sent by 6 July 2021.
The response paper, draft reporting standards and non-confidential submissions can be found below:
Response paper
Draft Reporting Standards
Non-confidential submissions
January 2021
On 7 January 2021, APRA issued an optional template that respondents may choose to use to provide structured feedback on the proposed Reporting Standard ARS 220.0 Credit Risk Management (ARS 220.0).
The template can be found below:
Template
December 2020
On 10 December 2020, APRA issued a consultation letter inviting submissions on potential revisions to APS 220 Credit Risk Management. Information on how to respond is contained in the consultation letter below.
Submissions closed on 29 January 2021.
Letter
Consultation on revisions to the new Prudential Standard APS 220 Credit Risk Management
October 2020
On 28 October 2020, APRA released a draft Reporting Standard ARS 220.0 Credit Risk Management (ARS 220.0) for consultation.
Written submissions on the draft ARS 220.0 should be sent by 28 January 2021.
The draft ARS 220.0 and accompanying letter can be found below:
Draft Reporting Standard
Letter
Proposed reporting standard ARS 220.0 Credit Exposures and Provisions
December 2019
On 12 December 2019, APRA released a response to submissions and final standard on Credit Risk Management (APS 220) and, for consultation, Draft Prudential Practice Guide APG 220 Credit Risk Management (APG 220).
Written submissions on the draft APG 220 should be sent by 12 March 2020.
The response paper, final APS 220, draft APG 220 and non-confidential submissions can be found below:
Response paper
Response to submissions: APS 220 Credit Risk Management
Prudential standard
Draft prudential practice guide
March 2019
The Australian Prudential Regulation Authority (APRA) has proposed updating its prudential standard on credit risk management requirements for authorised deposit-taking institutions (ADIs).
APS 220 was last substantially updated in 2006, and there has been significant evolution in credit risk practices since then, including more sophisticated analytical techniques and information systems. APRA’s plan to modernise the standard was prompted by its recent supervisory focus on credit standards, and also reflects contemporary credit risk management practices.
The proposed reforms are due to be implemented from 1 July 2020. See information relating to this consultation below:
Discussion paper
Draft prudential standard
Non-confidential submissions:
Note on submissions
It is APRA's policy to publish all submissions on the APRA website unless the respondent specifically tells APRA in writing that all or part of the submission is to remain confidential. An automatically generated confidentiality statement in an email does not satisfy this purpose. If you would like only part of your submission to be confidential, you should provide this information marked as 'confidential' in a separate attachment.
Submissions may be the subject of a request for access made under the Freedom of Information Act 1982 (FOIA). APRA will determine such requests, if any, in accordance with the provisions of the FOIA. Information in the submission about any APRA-regulated entity that is not in the public domain and that is identified as confidential will be protected by section 56 of the Australian Prudential Regulation Authority Act 1998 and will therefore be exempt from production under the FOIA.