Scott Morrison: I am pleased to announce that Australia will participate in the International Monetary Fund’s (IMF) Financial Sector Assessment Program (FSAP) in 2018.
As a country with an IMF-designated systemically important financial system and a member of the Financial Stability Board, Australia has agreed to undergo an FSAP every five years. This is an important symbol of Australia’s commitment to adopting global financial standards that improve financial stability and increase Australia’s attractiveness as a foreign investment destination in this critical area of the economy.
As part of the FSAP, a team of financial sector experts will undertake a rigorous and comprehensive assessment of the stability of Australia’s financial system and its ability to absorb macroeconomic shocks.
The FSAP will also assess our financial regulatory framework and compliance with core international standards governing the banking industry.
The FSAP team is due to visit Australia in December 2017 and again in June and August 2018. Team members will meet with financial regulators as well as a range of financial industry participants.
Australia’s financial system performed well during the financial crisis and the Government and regulatory agencies have worked hard to ensure that we are well positioned in the event of any future crises. For example:
- the Australian Prudential Regulation Authority (APRA) recently announced its plans to ensure that Australia’s banks are ‘unquestionably strong’; and
- our Government has recently introduced legislation to improve APRA’s ability to resolve a troubled institution with minimal impact on the broader economy.
Our participation in the FSAP will build on these reforms and help to ensure that our system of financial regulation remains in line with global best practice.