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Banking Act 1959 - Making of Prudential Standards: APS 110 - Capital Adequacy; APS 111 - Capital Adequacy: Measurement of Capital; APS 221 - Large Exposures; APS 222 - Associations with Related Entities (25/11/2002)
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Turn the raw legal text into a practical explanation grounded in Banking Act 1959 - Making of Prudential Standards: APS 110 - Capital Adequacy; APS 111 - Capital Adequacy: Measurement of Capital; APS 221 - Large Exposures; APS 222 - Associations with Related Entities (25/11/2002).
This standard aims to ensure that ADIs maintain adequate capital to support the risks associated with their activities on both a stand-alone and group basis.
This standard outlines the overall framework adopted by APRA for assessing an ADI’s capital adequacy. It should be read in conjunction with: APS 111 – Capital Adequacy: Measurement of Capital; APS 112 – Capital Adequacy: Credit Risk; and APS 113 – Capital Adequacy: Market Risk.
Note: Foreign ADIs (which have the same interpretation as in Division 1B of the Banking Act 1959) operating through branches in Australia are not subject to this Standard (and other related Capital Adequacy Standards as mentioned above). They must, however, be subject to comparable capital adequacy standards in their home country.
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