Powered by MOMENTUM MEDIA
subscribe to our newsletter
Regulators not the sole stewards of good banking culture: APRA

Regulators not the sole stewards of good banking culture: APRA

The Australian Prudential Regulation Authority has responded to the Hayne commission interim report by saying that a good banking system is produced by good bankers and “can’t be left to regulators alone”.

In a speech at the Financial Services Institute of Australasia (FINSIA) Summit, APRA chairman Wayne Byres acknowledged that regulatory initiatives in the pipeline — accountability statements, remuneration restrictions, strengthened governance requirements, greater attention to organisational culture and more forceful enforcement — will drive change.

However, Mr Byres added that “the task to truly generate cultural change within the banking industry cannot be left to regulators alone”.

Advertisement
Advertisement

“As I have said on a number of occasions, regulators can play their part but cannot regulate a good culture into existence,” Mr Byres said.

“To borrow an apposite quote, ‘Good banking is not produced by good laws, but by good bankers’.”

Mr Byres acknowledged the findings of the Hayne commission interim report that regulators can and should do more to actively enforce standards of behaviour within the financial sector.

He added that APRA has traditionally examined cases of poor conduct as an indicator of risk, but not a direct prudential risk in and of itself, unless it was likely to jeopardise the stability of the system or an individual institution.

“We will clearly need to reflect on that approach,” Mr Byres said.

[Related: Regaining trust in financial sector ‘not the regulator’s job’: APRA]

Regulators not the sole stewards of good banking culture: APRA
mortgagebusiness

 

Latest News

ASIC has approved the brand change of a Western Australian-based lender, which according to the bank will help facilitate the national launc...

The government has launched a consultation on making industry codes, such as the ABA’s banking code, legally enforceable. ...

Home loan interest rates can rise 43 to 52 basis points on average once fixed rate terms end, unless borrowers proactively negotiate, a new ...

FROM THE WEB
podcast

LATEST PODCAST: Coalition government and CBA delays

Is enough being done to ensure responsible lending?