Banking (prudential standard) determination No. 1 of 2011 Variation of various Prudential Standards (Cth)

Banking (prudential standard) determination No. 1 of 2011

Liquidity and Capital Adequacy

Banking Act 1959

I, Charles Littrell, delegate of APRA, under subsection 11AF(3) of the Banking Act 1959 (the Act) and under subsection 33(3) of the Acts Interpretation Act 1901 VARY Prudential Standard APS 210 Liquidity (APS 210), Prudential Standard APS 110 Capital Adequacy (APS 110) and Prudential Standard APS 111 Capital Adequacy: Measurement of Capital (APS 111) as set out in the attached Schedule.

This instrument takes effect on 1 March 2011 or the date of registration on FRLI whichever last occurs.

Dated 22 February 2011

[Signed]

Charles Littrell

Executive General Manager

Policy, Research and Statistics Division

Interpretation

In this instrument:

APRA means the Australian Prudential Regulation Authority.

FRLI means the Federal Register of Legislative Instruments established under the Legislative Instruments Act 2003.

Schedule

1. Paragraph 11 of APS 210 is amended by the addition of the following words:

“However, an ADI may, subject to APRA’s prior written approval, exclude from its “liabilities” any medium term notes issued under  securitisations that do not comply with all requirements under Prudential Standard APS 120 Securitisation (APS 120)”.

1. Paragraph 2 of Attachment C Non-consolidated subsidiaries of APS 110 is amended by the addition of the following extra subparagraph (e):

“(e)    provided APRA gives its written approval, securitisation special purpose vehicles, where the ADI is an originating ADI, which comply with all the requirements of Prudential Standard APS 120 Securitisation (APS 120) other than subparagraph 2(d) of Attachment B of APS 120 and the ADI has elected to deduct any holdings of subordinated tranche(s) from Tier 1 capital in accordance with subparagraphs 39(pp) and 44(pp) of APS 111 Capital Adequacy:  Measurement of Capital.”

1. Paragraph 39 of APS 111 is amended by the addition of the following extra subparagraph (pp):

“(pp) where the ADI is an originating ADI for a securitisation vehicle which complies with all the requirements of APS 120 Securitisation (APS 120) other than subparagraph 2(d) of Attachment B of APS 120 because the ADI is holding the subordinated tranche(s) of the securitisation vehicle, and the ADI has received APRA’s written approval to deduct the subordinated tranche(s) in respect of the specific securitisation vehicle, the subordinated tranche(s);”.

1. Paragraph 44 of APS 111 is amended by the addition of the following extra subparagraph (pp):

“(pp) where the ADI is an originating ADI for a securitisation vehicle which complies with all the requirements of APS 120 other than subparagraph 2(d) of Attachment B of APS 120 because the ADI is holding the subordinated tranche(s) of the securitisation vehicle, and the ADI has received APRA’s written approval to deduct the subordinated tranche(s) in respect of the specific securitisation vehicle, the subordinated tranche(s);”.