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Greg Medcraft made some very encouraging impromptu comments at the COALA/CBA Blockchain Workshops conference in Sydney on 10 December that are consistent with the renewed push to facilitate technology-led innovation in Australia. Mr Medcraft indicated that the Australian Securities and Investments Commission (ASIC) is willing to support the modification of Australian law to the extent it can, to encourage innovation like blockchain. He noted that the International Organisation of Securities Commissions (which he chairs), the…
APRA’s discussion paper and proposed new APS 120 provide some welcome clarification and concessions for Australian market participants.  Released on Thursday 26 November 2015, the proposals will be open for comment until 1 March 2016.  The proposed effective date for these rules in 1 January 2018. Amongst the more important proposals are: De-facto master trust approval A range of proposed changes seem to point the way for de-facto approval of master trusts.  These changes could…
The Australian Senate Economics Reference Committee released its long-awaited report into the digital currencies on 4 August 2015. Digital currencies and blockchain technology is hot news. For many, the blockchain sensation is reminiscent of the early days of the internet.  We have even seen trialling of blockchain technology and some bitcoin sector investment by Australian banks.  The big question has been whether, and if so, how, to regulate this burgeoning technology without suffocating it in…
On 8 July the Basel Committee (BIS) issued a paper setting out 13 corporate governance principles for banks. These principles supersede the 2010 BIS principles and are to be applied and adapted by national bank regulators as they see fit.  This work has been some time in the making with a peer review conducted by the Financial Stability Board (FSB) back in 2013. The FSB found that although banks exhibit a better understanding of the…
Two of the recommendations by the Murray Report  were directed at payment systems: Clearer graduated payments regulation The Inquiry noted that Australia has a complex, fragmented and less than clear framework for regulating payments, which is administered by ASIC, APRA and the Payment Systems Board (PSB). It proposed that the regulators should publish a clear guide to the framework for industry, in particular for new entrants, that outlines thresholds and regulatory requirements. Changes were also…
The expansion of debt capital markets funding by corporates has been on the agenda of both this present and previous governments, as they seek to encourage diversification of funding sources and create investment products for retail and institutional investors. The Murray Report’s  recommendation should be welcomed and supported by the industry which has long advocated for some template-style issuance. Disappointingly, there is no specific recommendation for standardised terms and reduced disclosure requirement for some…
The Final Report of the Murray Inquiry recommends an increase in the amount of capital to be held by Australian authorised deposit-taking institutions (ADIs), to keep them in the top 25% in global rankings. This will potentially require them to hold a further 1% in regulatory capital, and could also require  further equity capital raisings to achieve what the Report calls “a safety buffer to absorb losses”. ADIs have already successfully raised further capital this…
It is notable that the Murray Inquiry’s Final Report did not recommend the regulation of shadow banking but has left that sector to be reviewed annually by the Council of Financial Regulators. There is to be ongoing reliance on the Financial Claims Scheme and the depositor protection regime, with a hint that perhaps the $250,000 level of protection currently provided for each account with each institution, should be revisited. The absence of a recommendation on…