Independent Review – Australian Prudential Regulation Authority
On 12 December 2019, the Australian Prudential Regulation Authority (APRA) released a new prudential standard for banks and other authorised deposit-taking institutions (ADIs), Prudential Standard APS 220 Credit Risk Management, to replace Prudential Standard APS 220 Credit Quality from January 2021.
The standard places a requirement on ADIs to control credit risk by adopting prudent credit risk management policies and procedures. Credit risk relates to the potential that borrowers will fail to meet their contractual obligations on loans and other credit products.