APRA releases information paper on credit risk capital requirements for housing loans
The Australian Prudential Regulation Authority (APRA) has released an information paper that explains how the capital adequacy rules for housing lending work and explores two key questions:
- how does APRA ensure that capital requirements for housing lending are sufficient to withstand losses through the cycle?; and
- how does APRA ensure that the differences between internal ratings-based and standardised capital requirements are appropriate, and limit impacts on competition in the Australian banking system?
The full information paper can be found on the APRA website: Demystifying credit risk capital requirements for housing loans.
The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, mutuals, general insurance and reinsurance companies, life insurance, private health insurers, friendly societies, and most members of the superannuation industry. APRA currently supervises institutions holding around $9 trillion in assets for Australian depositors, policyholders and superannuation fund members.