Consequential reporting changes to ARS 110.0 – Capital Adequacy
To: All authorised deposit-taking institutions
The Australian Prudential Regulation Authority (APRA) is seeking feedback on proposed consequential amendments to Reporting Standard ARS 110.0 – Capital Adequacy (ARS 110), following its consultation on targeted liquidity changes in November 2023 and on Interest Rate Risk in the Banking Book (IRRBB) reporting in July 2024.
Targeted Liquidity and Capital changes to ARS 110
APRA’s response to the targeted liquidity and capital reforms consultation was released on 24 July 2024 and will come into effect on 1 July 2025. The proposed changes in ARS 110 are intended to apply for reporting periods ending on or after 30 September 2025.
APRA’s targeted liquidity consultation package amended Prudential Standard APS 111 Capital Adequacy: Measurement of Capital (APS 111) in paragraph 41 of Attachment D (Regulatory adjustments) with respect to unrealised fair value losses.
APRA proposes to collect data on “unrealised losses for securities in the liquid asset portfolio that are not measured at fair value” under ARS 110.
IRRBB Changes to ARS 110
APRA’s response to the IRRBB Reporting consultation released on 8 July 2024, was accompanied by a finalised version of Reporting Standard ARS 117.1 - Interest Rate Risk in the Banking Book (ARS 117.1).
When ARS 117.1 goes live in APRA Connect for the reporting period ending 31 December 2025, APRA proposes that the risk-weighted assets equivalent amount of the IRRBB capital requirement in ARS 110 will be validated against the IRRBB Capital Charge in ARS 117.1 to ensure consistency between the values reported in each collection.
APRA then proposes to update Item 3.1 of Section B in ARS 110 to clarify that for reporting periods ending on or after 31 March 2026, the item will be automatically calculated based on information entered into the relevant table for Reporting Form ARF 117.1 Interest Rate Risk in the Banking Book.
APRA is seeking feedback on the above proposed reporting changes. Refer to the draft marked up reporting standard released with this consultation for further information.
ADIs are invited to comment on the proposed changes. Written submissions should be sent to DataConsultations@apra.gov.au by 14 February 2025 and addressed to:
Senior Manager, Data Collection Design and Management
Technology and Data Division
Australian Prudential Regulation Authority
Yours sincerely,
Andy Robertson
Chief Data Officer
Technology and Data Division
Note on submissions
It is APRA's policy to publish all submissions on the APRA website unless the respondent specifically tells APRA in writing that all or part of the submission is to remain confidential. An automatically generated confidentiality statement in an email does not satisfy this purpose. If you would like only part of your submission to be confidential, you should provide this information marked as 'confidential' in a separate attachment.
Submissions may be the subject of a request for access made under the Freedom of Information Act 1982 (FOIA). APRA will determine such requests, if any, in accordance with the provisions of the FOIA. Information in the submission about any APRA-regulated entity that is not in the public domain and that is identified as confidential will be protected by section 56 of the Australian Prudential Regulation Authority Act 1998 and will therefore be exempt from production under the FOIA.