Capital requirements top of APRA’s agenda

Speaking before the Senate economics legislation committee, APRA chairman Wayne Byres said the implementation of capital standards, as recommended by the Financial System Inquiry (FSI), would ensure the capital ratios of deposit-takers was “unquestionably strong”.

“Our goal in implementing the FSI’s recommendation is to enhance the capital framework for deposit-takers to achieve not only greater resilience, but also increased flexibility and transparency,” said Mr Byres.

“In doing all this, we will also be working to enable affected institutions to adjust to any policy changes in an orderly manner; if we achieve our goals, we will not only deliver improved safety and stability within the financial system, we will also aid other important considerations such as competition and efficiency.”

The regulator had intended to wait until the Basel Committee on the international bank capital regime had concluded their work, Mr Byres said, but can’t wait any longer given the delays to the committee’s progress.

[Related: APRA under pressure to curb lending as Sydney booms]