APRA Finalises Revisions to IRRBB Framework for Australian Banks


Article: The Australian Prudential Regulation Authority (APRA) has announced the completion of its revised framework for Interest Rate Risk in the Banking Book (IRRBB) requirements for authorised deposit-taking institutions (ADIs). This announcement comes in response to submissions made during the December 2023 consultation on IRRBB reforms.

APRA’s finalized revisions include the Prudential Standard APS 117 Capital Adequacy: Interest Rate Risk in the Banking Book (APS 117), the Reporting Standard ARS 117.0 IRRBB Repricing Analysis Collection (ARS 117.0), and the Reporting Standard ARS 117.1 IRRBB Capital Charge Collection (ARS 117.1). The updated framework will also include the final revised practice guides.

According to the regulatory body, the revised APS 117 will go into effect starting October 1, 2025. The finalized standards, guidance, and non-confidential submissions from the consultation can be accessed through APRA’s Interest Rate Risk in the Banking Book page.

APRA serves as the prudential regulator for the financial services industry in Australia, supervising banks, mutuals, general insurance and reinsurance companies, life insurance firms, private health insurers, friendly societies, and most members of the superannuation industry. The regulatory body presently oversees institutions holding around $9 trillion in assets for Australian depositors, policyholders, and superannuation fund members.