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What is APRA?

The Australian Prudential Regulation Authority (APRA) is an independent statutory authority that supervises institutions across banking, insurance and superannuation, and is accountable to the Australian Parliament

APRA was established by the Australian Government on 1 July 1998 following the recommendations of the Wallis Inquiry into the Australian financial system. Prudential regulation is concerned with maintaining the safety and soundness of financial institutions, such that the community can have confidence that they will meet their financial commitments under all reasonable circumstances.

APRA oversees:

  • authorised deposit-taking institutions (such as banks, building societies and credit unions)
  • general insurers
  • life insurers
  • friendly societies
  • private health insurers
  • reinsurance companies, and
  • superannuation funds (other than self-managed funds).

Under the legislation that APRA administers, APRA is tasked with protecting the interests of depositors, policyholders and superannuation fund members.

APRA promotes financial system stability by working closely with the Australian Treasury, the Reserve Bank of Australia (RBA), and the Australian Securities and Investments Commission (ASIC).

While APRA seeks to reduce the likelihood of a financial institution failing, it cannot, and does not, guarantee that failure may never occur. In the unlikely event an APRA-regulated institution was to fail, APRA has the role of administering the Financial Claims Scheme when activated by the Australian Government. This Scheme allows depositors of a failed deposit-taker to access their funds (up to a limit) in a timely manner, or provides general insurance policyholders with access to funds (up to a limit) to meet an eligible claim.

APRA also acts as a national statistical agency for the financial sector, collecting data both for its own uses and on behalf of the Reserve Bank of Australia and the Australian Bureau of Statistics. APRA provides this data in their statistical publications.