Both APRA Chair John Laker and ASIC Chair Greg Medcraft spoke at a recent industry conference.

John Laker’s speech focussed on Basel III and the concept of “living wills” for financial institutions:

“A living will refers to two separate but related matters: ‘recovery plans’ and ‘resolution plans’. Recovery planning focuses on measures that would enable a financial institution to survive a destabilising event, such as through its strategies for raising additional capital, accessing liquidity or disposing of non-core business. Resolution planning focuses on measures that would enable a cost-effective resolution of the institution by the authorities where recovery is not possible, such as pre-positioning for different forms of resolution and simplifying complex group structures to facilitate resolution. Recovery and resolution planning are connected in that both deal with distress events that threaten the viability of a financial institution and both seek to achieve a resolution that minimises adverse systemic impact, at the lowest risk to the taxpayer. However, recovery and resolution planning address some quite different issues and the complexities and challenges vary with each.”

Greg Medcraft’s speech focussed on the new licensing and supervision rules for financial advisers including proposals in respect of managing conflicts of interest, training and assessment and ethics and standards.