So, you’re interested in forming a bank in Australia?

So, you’re interested in forming a bank in Australia?

Financial Services
Is it just us or is having your own digital bank the new must-have item at the moment? The announcement by APRA late last week that it had signed off on Australia’s first ever digital bank under a restricted licensing regime came as no surprise to those who have been monitoring the debate around how to increase competition in the banking sector. You can read more about the restricted banking licence granted by APRA last week to Volt Bank Limited application by accessing our previous coverage on it - click here to view. So, if owning your own bank is the next-big-thing, in the world of fintech, how does one go about getting a piece of the banking pie for themselves? Today we will take a closer look at forming…
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A braided network of reviews and investigations into the Murray-Darling river basin

A braided network of reviews and investigations into the Murray-Darling river basin

Uncategorized
On 31 July, the Prime Minister requested the Murray-Darling Basin Authority (MDBA) to consider conducting a nation-wide compliance review (https://www.mdba.gov.au/media/mr/basin-wide-compliance-review). This is a response to allegations of illegal diversion of water in New South Wales (NSW) and official impropriety. At the same time, there are at least five other reviews or possible investigations that have begun or are being considered which relate to management of the basin including the involvement of the Commonwealth Auditor-General and the Independent Commission Against Corruption (ICAC). By Dr Drew Donnelly, Compliance Quarter In today’s article, we untangle these different reviews and potential investigations, describing their objectives and how they relate to each other. Background: The Basin Plan and the latest allegations The Murray-Darling basin is an agricultural area spanning NSW, Victoria, Queensland, South Australia and…
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Upcoming changes to dispute resolution: the new Australian Financial Complaints Authority

Upcoming changes to dispute resolution: the new Australian Financial Complaints Authority

Financial Services
The Australian Financial Complaints Authority (AFCA) is the proposed new dispute resolution body for the financial sector. Last week, the Government announced the latest step in the establishment of this new body with the appointment of a transition team for its establishment. By Dr Drew Donnelly, Compliance Quarter In today’s article, we summarise the proposals to date for overhauling external dispute resolution in financial firms. Note, that it is proposed that ‘financial firms’ be defined broadly so that the new framework will affect and apply to a vast range of businesses including: All Australian Financial Services (AFS) licensees credit providers regulated superannuation funds approved deposit funds retirement savings account providers and life policy funds and insurers. The transitional arrangements The focus for the newly appointed team is to ensure a…
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Energy Storage Reforms suggested by the Clean Energy Council

Energy Storage Reforms suggested by the Clean Energy Council

AU Energy Compliance, Uncategorized
In May 2017, the Clean Energy Council (CEC) released a Briefing Paper, Charging Forward: Policy and regulatory reforms to unlock the potential of energy storage in Australia (Briefing Paper). By Anne Wardell, Regulatory Specialist, Compliance Quarter The purpose of the paper is to outline ‘thirteen reforms that can be introduced to accelerate the uptake of energy storage and the many benefits this technology can deliver to homes, businesses and the electricity system overall’[1] The CEC is of the view that the National Energy Market Framework (NEMF) currently undervalues many of the benefits which effective storage can offer. ‘The Clean Energy Council has identified thirteen energy market reforms required to drive the most efficient commercial roll-out of energy storage throughout Australia while ensuring a secure and affordable national power system. These…
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The superannuation overhaul: seven areas of reform in the draft bill out for consultation

The superannuation overhaul: seven areas of reform in the draft bill out for consultation

Uncategorized
Today we look at proposed changes to regulatory obligations for those operating in the superannuation sector. Namely, the seven key changes contained in the draft Treasury Legislation Amendment (Improving Accountability and Member Outcomes in Superannuation) Bill 2017 (the draft bill). By Dr. Drew Donnelly, Compliance Quarter Useful terminology The reforms proposed in the draft bill are generally concerned with ‘Registrable Superannuation Entities’ (RSEs). Under section 10 of the Superannuation Industry (Supervision) Act 1993 (the SIS Act), an RSE is either a regulated superannuation fund, an approved deposit fund or a pooled superannuation trust. It does not include a self-managed superannuation fund. In particular, the focus is on the obligations of ‘RSE licensees’ (those who have been given a licence to operate an RSE), as well as ‘trustees’ of a fund…
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An open banking regime for Australia: July fintech update

An open banking regime for Australia: July fintech update

Uncategorized
  On July 20, the Government announced that an independent review has been set up to consider the best process for implementing an open banking data regime in Australia. Open banking requires banks to share product and customer data with customers and, with their consent, third parties. By Dr. Drew Donnelly, Compliance Quarter An open banking regulatory regime is a key part of the Government’s financial technology (fintech) commitments, and something that we have written about before. So far, the Government has established a review panel and released a terms of reference. An issues paper for public comment will be released in due course, but in the meantime, it would be useful to think about the key areas signposted in the terms of reference, in light of the Productivity Commission’s Inquiry…
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Key definitions under the Energy Retail Law

Key definitions under the Energy Retail Law

AU Energy Compliance, Uncategorized
There are some key definitions contained in the Energy Retail Law which need to be understood.  Chapter 10 of the National Electricity Rules (NER) contains the Glossary and it covers 114 pages. Often the definition of the word or phrase will contain words which also need to be defined. By Anne Wardell, Compliance Quarter Embedded Network For example, the definition of an Embedded Network is: A distribution system, connected at a parent connection point to either a distribution system or transmission system that forms part of the national grid, and which is owned, controlled or operated by a person who is not a Network Service Provider. Each of the phrases in italics has a separate definition within the Glossary. To understand all the meanings, you may watch a short presentation…
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APRA’s new capital benchmarks for banks

APRA’s new capital benchmarks for banks

Uncategorized
The Australian Prudential Regulation Authority (APRA) has just announced that it is increasing the capital adequacy ratios for banks and other authorised deposit-taking institutions (ADIs) in Australia, with the new rates to be in place by January 2020. Today we explain what the relevant capital adequacy ratio is, the different methods used to calculate it and describe the two new benchmarks. By Dr. Drew Donnelly, Compliance Quarter Background In Expected credit loss: the new way banks must recognise shifting credit risk we discussed APRA recent changes to the way in which banks must recognise impairment of loans. The goal with that change was to make sure banks “maintain provisions and reserves adequate to absorb existing and estimated future credit losses into its business”. Another important tool employed by APRA to…
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Government progress on cybersecurity in Australia

Government progress on cybersecurity in Australia

Uncategorized
Earlier this year, the Government’s cyber security advisor, Alastair MacGibbon, described a “prevailing ‘tick box’ compliance culture” for federal government agencies when it comes to cyber security. Furthermore, in a report released in May the Australian Strategic Policy Institute (ASPI) recommended various areas where the Government needs to improve its approach to cyber security, particularly, in adapting and implementing the ‘National Cybersecurity Strategy 2016-2021’. In more positive news, on July 6, the International Telecommunications Union (ITU), released its ‘Global Cybersecurity Index’, where Australia was ranked a top ten nation for its commitment to cyber security. By Dr. Drew Donnelly, Compliance Quarter In a range of articles recently we have looked at technological developments which call for strong cyber security compliance requirements, including the Productivity Commission’s proposed data-sharing regime and developments…
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AUSTRAC’s risk assessment: three areas where you may need to step up your compliance program

AUSTRAC’s risk assessment: three areas where you may need to step up your compliance program

Uncategorized
The Australian Transaction Reports and Analysis Centre (AUSTRAC) has just released a report (12 July) Securities & derivatives sector: money laundering and terrorism financing risk assessment revealing the vulnerabilities of the securities and derivatives sector with regards to financial crime. We recently took at AUSTRAC’s advice on the risk management obligations of businesses. We have also looked at the compliance obligations of those who trade in OTC derivatives. By Dr. Drew Donnelly, Compliance Quarter Today we review AUSTRAC’s assessment with one focus; in which areas are businesses still falling short in meeting their obligations under the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) framework. AUSTRAC’s Findings AUSTRAC’s report used three key sources in developing its risk assessment: Analysis of suspicious matter reports (SMRs), as well as other AUSTRAC intelligence Reports and…
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