The Financial Regulator Assessment Authority (FRAA) has released its review of the Australian Prudential Regulation Authority (APRA).
The review recognised APRA’s key role in maintaining financial safety and system stability for the benefit of the community and its important contribution to Australia’s world-leading financial system.
It also found APRA’s supervision of superannuation is “effective and capable” but its resolution function is less developed, which matched with APRA’s self-assessment.
The five FRAA recommendations which aim to strengthen risk identification in the superannuation industry, continued development of capabilities and expertise of APRA’s people, investment in data and technology, enhancing transparency to maximise the impact of APRA’s outcomes, and lifting recovery planning and resolution readiness.
The recommendations are:
APRA chair, John Lonsdale, said: “APRA welcomes the FRAA’s review of APRA’s superannuation capabilities. The recommendations provide helpful guidance and reinforcement for a more effective APRA into the future.
“APRA will continue to build on its strong foundation of safeguarding the financial wellbeing of the Australian community by further strengthening prudential frameworks and improving capability to drive better industry practices in superannuation for the benefit of members."
Amid a challenging market environment, three super fund CIOs have warned against ‘jumping at shadows’.
The professional body is calling for the annual performance test to transition to a two-metric test, so it better aligns with the overarching duty of super fund trustees to act in the best financial interests of their members.
AustralianSuper, Rest, and HESTA agree on the need to retain and enhance the test, yet they differ in their perspectives on the specific areas that warrant further refinement.
Australia’s second-largest super fund has confirmed it is expanding its presence in the UK following significant investment in the region.
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