APRA helps industry prepare for pandemic
In an effort to help financial institutions plan for a potential pandemic, the Australian Prudential Regulation Authority (APRA) has released an information paper and prudential practice guide to assist APRA-regulated companies.
According to APRA, Australian financial institutions need to develop a more consistent and predictable approach to pandemic preparedness and be more aware of their telecommunications capacity.
To ensure they receive adequate priority in a pandemic scenario, financial institutions should recognise the critical role of maintaining essential financial services in promoting public confidence.
Pandemic planning assists financial institutions consider the possible impact to their business of a human outbreak of influenza or other disease.
APRA’s interest is in ensuring that regulated institutions have conducted prudent and reasonable planning to meet core obligations to depositors, policyholders and other beneficiaries.
Covering areas such as pandemic project governance, business continuity management, the typical content of pandemic plans, definition of critical functions, the range of external factors that need to be considered and potential financial impacts, APRA’s advice has been released following consultation with industry and research into pandemic planning that is taking place around the world.
APRA has been working on pandemic planning in recent months with larger institutions, industry associations, other financial regulators and the Government.
The focus has been on highlighting good practice, identifying industry-level issues and assessing potential financial impacts on regulated institutions.
According to APRA, most financial institutions are “significantly advanced” in their pandemic planning efforts with some establishing internal pandemic committees and developing a pandemic plan that links directly to crisis management, communications, liquidity and other plans.
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