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The Australian Prudential Regulation Authority (APRA) has confirmed plans to formally introduce a three-tiered approach to proportionality in its prudential framework for banking.

The measure is one of a number of reforms APRA moved to introduce as part of its response to the Council of Financial Regulators’ Review into Small and Medium-Sized Banks. The CFR review was undertaken in consultation with the Australian Competition and Consumer Commission (ACCC). It also aligns with APRA’s strategic commitment to get the balance right between its primary mandate for financial safety and stability and other considerations such as competition and efficiency.

Following a consultation that closed earlier this year, APRA today wrote to banks confirming it will proceed with the following proposals aimed at embedding additional proportionality and driving competition in the industry:

• Introducing a third tier of Most Significant Financial Institutions (MSFIs) for banks with total assets greater than $300 billion
• Raising the asset value threshold for banks to qualify as a Significant Financial Institution (SFI) from $20 billion to $30 billion; and
• Automatically providing a 12-month transition period when a regulated institution moves to a higher tier.

APRA also commits to providing non-SFIs with additional time to comply with new and revised prudential requirements when it is appropriate to do so.

APRA Executive Board Member, Therese McCarthy Hockey said: “Today’s changes reflect APRA’s ongoing commitment to building further proportionality into the banking framework and our supervision practices.

“This proportionality will only deepen over time as we look for more opportunities for greater differentiation between each of the banking tiers with each new piece of policy development.”

The changes take effect from 1 July 2026.

The letter formally responding to submissions to the consultation is available on the APRA website at: Formalising a three-tiered approach to proportionality in banking prudential framework

ASIC is warning consumers who have joined ‘share trading’ or ‘stock tips’ messaging app groups that scammers are using these forums to push investments on fake crypto-asset trading platforms.

These fake platforms show profits and trades, but in fact, there is no real trading, and the site contains fake data. Any money deposited into these platforms goes straight to the scammers.

View the full media release.

The Full Federal Court has re-sentenced former investment manager Rodney Forrest to five years and three months’ imprisonment following his appeal for insider trading and procuring others to trade in more than $3 million of Platinum Asset Management shares.

View the full media release.

The Australian Prudential Regulation Authority (APRA) and Australian Securities and Investments Commission (ASIC) have published the public notes from the life insurance CEO roundtable held on 15 April 2026.

The roundtable was hosted by APRA Member Suzanne Smith together with ASIC Commissioner Alan Kirkland. It was attended by 19 life insurance CEOs and other executives, as well as representatives from Treasury and the Council of Australian Life Insurers.

The notes can be found on the APRA website at: APRA and ASIC host life insurance CEO roundtable – April 2026

New research released today by ASIC shows that Australia is well-placed to harness an ongoing surge of financial innovation.

The Innovation in Financial Technology and RegTech research, conducted by the Digital Finance Cooperative Research Centre (DFCRC) for ASIC, lays out how Fintech and Regtech innovations are evolving across the world.

View the full media release.

ASIC has commenced civil penalty proceedings in the Federal Court against Equity Trustees Superannuation Limited (Equity Trustees), alleging failures in care, skill and diligence concerning the decision to allow members to invest in the First Guardian Master Fund (First Guardian).

View the full media release.

The Australian Prudential Regulation Authority (APRA) has intensified its oversight of banks, insurers and superannuation trustees as geopolitical tensions, artificial intelligence (AI) and growing complexity in global markets reshape the risk environment.

The update is contained in the latest edition of APRA’s System Risk Outlook report, which provides an overview of risks and vulnerabilities affecting the financial system from the perspective of Australia’s financial safety regulator.

Coming at a time of elevated uncertainty globally, today’s report reinforces Australia’s financial system is well-prepared to withstand a range of severe downside scenarios, including a deep global recession combined with higher funding costs and operational disruptions.

Other key insights include:

• Australia’s financial system is well-positioned to support the economy if conditions deteriorate in the current volatile environment. Banks and insurers remain well capitalised and have strong liquidity positions, while stress testing shows the system can withstand a range of “severe but plausible” shocks. To maintain resilience in an environment of heightened uncertainty, APRA has intensified its oversight of entities and sharpened its expectations for sound risk management.
• AI is being adopted rapidly across all regulated industries, but governance arrangements have not matured at the same pace. At the same time, cyber threats are becoming more sophisticated, including from advanced AI models. APRA recently reinforced its expectations for sound AI governance and risk management via a letter to industry.
• Although private credit remains relatively small in Australia, risks are growing internationally. Australian institutions are exposed to offshore developments through multiple channels, creating potential spillover risks that warrant close monitoring.

APRA Chair John Lonsdale said that while our financial system remains strong and stable, heightened vigilance is needed to keep it that way in a turbulent global political and economic environment.

“Strong capital, liquidity and prudential safeguards mean our financial system is well-positioned to absorb shocks and continue providing critical services to households and businesses, even if economic conditions deteriorate.

“Sustaining that resilience, however, will require ongoing investment in strong risk management across the system.

“Among the areas we are most focused on are rapid developments in AI, which are outpacing the ability of many entities to manage the risks, and potential impacts on Australia’s financial system flowing from the war in the Middle East and other geopolitical volatility.

“Moving forward, we will continue to assess how APRA-regulated entities are being impacted by overseas events and how well prepared they are for a range of potential downside scenarios, as well as seeking further uplift in cyber security capabilities and AI governance,” Mr Lonsdale said.

Today’s full report is available at: System Risk Outlook – May 2026

The next edition of the System Risk Outlook will be published towards the end of the year.

The Australian Prudential Regulation Authority (APRA) has revoked Eric Insurance Limited’s (Eric’s) authorisation to carry on insurance business in Australia under the Insurance Act 1973, following a request by Eric’s deed administrators.

Eric appointed voluntary administrators on 28 July 2025 and, following a meeting of creditors, executed a deed of company arrangement (DOCA) on 19 September 2025.

By virtue of the execution of the DOCA, Eric has no remaining liabilities in respect of its insurance business.

APRA has actively monitored Eric’s exit from the general insurance market for some time.

An updated list of general insurers can be found on the APRA website at: Register of general insurance

Chair Joe Longo delivered opening remarks at the Tech Council of Australia’s Future of Innovation in Australia’s Financial Markets event in Sydney on 21 May 2026.

Here are the highlights of Joe’s remarks:

• ASIC has launched new research which shows innovation is now impacting nearly every part of the global financial sector.
• As these technological changes accelerate, Australia’s challenge is not simply to keep up, but to stay ahead.
• If we do not embrace new market technologies now, we could be poorer for it as a nation in the future.

Find out more in the full speech.

The Australian Prudential Regulation Authority (APRA) has disqualified the former chair of Xinja Bank Limited (Xinja), Lindley Edwards, from being an accountable person of any authorised deposit-taking institution¹ under the Financial Accountability Regime (FAR).

Ms Edwards is disqualified for a period of six years for failing to comply with her accountability obligations as an accountable person of Xinja during 2020. Ms Edwards is the third accountable person of Xinja that APRA has disqualified. APRA announced its disqualifications of Eric Wilson for eight years and non-executive director Craig Swanger for 10 years on 9 October 2025.² This is now APRA’s third disqualification under the FAR.

The disqualification follows APRA investigating the impact on Xinja’s capital position of undisclosed “side agreements” between Xinja and some of its investors in 2020 and whether Xinja misled APRA about its true capital position. APRA’s investigation began in May 2021 and Ms Edwards’ disqualification has been the subject of review processes.

APRA determined that Ms Edwards failed to comply with several of her obligations as an accountable person under the Banking Executive Accountability Regime, which the FAR superseded for the banking industry in March 2024.

APRA found that Ms Edwards failed to:

• act with due skill, care and diligence when Xinja raised capital that she should have known could not qualify as CET1 capital³ because of the side agreements and did not take steps to ensure that Xinja properly classified and reported the capital, or disclosed the side agreements, to APRA;
• deal with APRA in an open, constructive and cooperative way by not informing, or being satisfied that Xinja had informed, APRA of the existence of the side agreements or of concerns raised at the time within Xinja about the capital; and
• take reasonable steps to prevent matters arising that would adversely affect Xinja’s prudential standing where she did not take steps to put in place adequate procedures within Xinja to ensure Xinja properly classified and reported the capital it raised.

APRA’s decision did not involve allegations or findings of dishonesty or lack of integrity on the part of Ms Edwards.

APRA Member Therese McCarthy Hockey said Ms Edwards’ disqualification is further demonstration that APRA will hold senior individuals to account when they fail to meet their accountability obligations.

“In order to protect depositors and the financial system, it is essential APRA has a complete understanding of the capital position of the banks it supervises and their ongoing capacity to withstand unexpected shocks. It is incumbent on senior individuals to be open and cooperative with APRA so that APRA can effectively assess the risks that a bank and its depositors are exposed to. Board members are in a position of ultimate responsibility for all aspects of governance, oversight and compliance with all relevant laws and Ms Edwards’ conduct fell short of her duties.

“Ms Edwards inappropriately relied on others and failed to ensure that Xinja was sufficiently capitalised in the months leading to its failure, or that its true capital position was reported to APRA. Her disqualification reflects the seriousness of her conduct.”

Background

Between May and August 2020, Xinja entered agreements with three investors by which it purported to raise CET1 capital.  Xinja reported to APRA that the capital it raised from the investors was CET1 capital. However, the capital raisings involved “side agreements” between Xinja and the investors, which APRA was not informed of and which fundamentally altered the nature of the capital, altering its ability to absorb losses and resulted in the capital not qualifying as CET1 capital.

Xinja (now A.C.N. 618 937 054 Limited) is in liquidation after returning its deposits and handing back its ADI licence to APRA in 2021.

Footnotes

¹ Ms Edwards is also disqualified from being or acting as an accountable person of any authorised non-operating holding company (NOHC) of an ADI and any significant related entity of an ADI or NOHC of an ADI.

² APRA disqualifies two directors of Xinja Bank under Financial Accountability Regime | APRA

³ CET1 capital represents the highest quality capital that an ADI must hold and ensures an ADI is able to absorb losses immediately when they occur.

The Federal Court has ordered a $33.5 million penalty against online retailer Walker Stores Pty Ltd (in liquidation), which traded as Snaffle, for unlawfully overcharging tens of thousands of consumers under credit contracts.

View the full media release.

ASIC has outlined key focus areas for its financial reporting, audit and sustainability reporting activities in the 2026-27 financial year, including updates to its surveillance programs.

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The Australian Prudential Regulation Authority (APRA) has released for consultation a new draft licensing framework for locally-incorporated Authorised Deposit-taking Institutions (ADIs).

The consultation package follows APRA’s 2025 discussion paper on improving the licensing framework for ADIs. When finalised later this year, the changes will implement Action 6 of the Council of Financial Regulators’ Review into Small and Medium-sized Banks – that APRA update its ADI licensing framework to make the application process more transparent and efficient.

Written submissions should be sent to Licensing@apra.gov.au by 31 July 2026.

The consultation paper, draft ADI Licensing Criteria, draft ADI Licensing Guidelines, and non-confidential submissions to APRA’s 2025 consultation are available on the APRA website at: APRA consults on more efficient and transparent bank licensing framework

Ashley Arandez of Hoppers Crossing in Victoria has been sentenced to 5 years and 6 months imprisonment in the County Court of Victoria, after pleading guilty to offences involving dishonest conduct, carrying on an unlicensed financial services business, and recklessly dealing with the proceeds of crime.

View the full media release.