The Australian Regulatory Framework

Responsibilities for financial stability are shared across four main agencies in Australia – the RBA, the Australian Prudential Regulation Authority (APRA), the Australian Securities and Investments Commission (ASIC), and the Treasury.

These four agencies comprise the Council of Financial Regulators (CFR). The CFR is the main coordinating body for Australia’s financial regulators and is chaired by the Governor of the RBA. It facilitates cooperation and collaboration across member agencies, with the ultimate aim of promoting the stability of the Australian financial system and supporting effective and efficient regulation. In pursuing this aim, the CFR also seeks to support competition in the financial system.

Each agency has a distinct but complementary role, and all work closely with each other to promote financial stability:

• The Reserve Bank of Australia (RBA) is the central bank, responsible for contributing to the stability of Australia’s financial system, regulating the payments system, and supervising and resolving clearing and settlement facilities. It is the ultimate provider of liquidity to the financial system and a key participant in financial crisis management.
• The Australian Prudential Regulation Authority (APRA) is the prudential regulator, responsible for supervising banks, insurers and superannuation funds. It is also responsible for macroprudential policy and the resolution of APRA-regulated entities.
• The Australian Securities and Investments Commission (ASIC) is responsible for monitoring, regulating and enforcing corporations and financial services law, and promoting market integrity and consumer protection across the financial services sector. ASIC regulates and supervises financial markets and regulates clearing and settlement facilities, with its role being complementary to the supervision of those facilities by the RBA.
• The Treasury is responsible for advising the Government on financial stability, including on the financial regulatory framework, policy responses to help alleviate the economic impact of financial crises, and any necessary Government support in resolutions.