Maintaining the stability of the financial system is a longstanding responsibility of the Reserve Bank. A stable financial system is one in which financial institutions, markets and market infrastructures facilitate the smooth flow of funds between savers and investors. This helps to promote growth in economic activity.
The Reserve Bank has a role both in mitigating the risk of financial disturbances that may have systemic consequences, and in responding to a financial system disturbance should it occur. The Bank works on these matters with other relevant agencies, mainly through the Council of Financial Regulators (CFR). The CFR, which is chaired by the Reserve Bank Governor, brings together the Bank, APRA, the Treasury and ASIC, with a mandate to contribute to the efficiency and effectiveness of regulation and the stability of the financial system.