The Australian Prudential Regulation Authority (APRA) has again flagged the possibility of the regulator seeking to extend the Bank Executive Accountability Regime (BEAR) to other sectors of the financial services industry.
APRA chair, Wayne Byres has used a speech to a financial services event to state that once the new legislative framework underpinning the BEAR has been put in place for the banks, “APRA intends to think about whether some of the concepts within the regime have broader application”.
However, Byres said that he believed APRA would only be using the powers granted to it under the BEAR regime “rarely” whilst warning that his statement should not be interpreted as meaning the regulator would be reluctant to use the powers.
“But the goal must be that, with clear boundaries and obligations set out by the regulatory framework, boards and executives conduct their affairs in such a manner that intervention by APRA is not needed,” he said.
“It is a much better outcome, for example, that boards hold their executives to account for poor outcomes than have to rely on the regulator to do it for them,” Byres said. “My observation is that this has been the experience in the UK, where a similar regime is already in place. Although there are strong powers for regulators if and when needed, the industry has responded by adjusting the way it operates so that the need for regulatory intervention has been quite limited.”
Financial advice is having a significant impact on how Australians are engaging with the more complex aspects of their superannuation, new findings have shown.
While the Financial Advice Association Australia said it supports a performance testing regime “in principle”, it holds reservations about expanding this scope to retirement products.
In a Senate submission, the Financial Services Council said super funds should be able to nudge members on engaging with their super and has cautioned against default placements.
The Joint Associations Working Group, which counts FSC in its ranks, has issued an urgent warning to the government.
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