APRA slap for ACCC

John Trowbridge, one of three members of the Australian Prudential Regulatory Authority, yesterday indulged in a little inter-agency finger pointing.

In a review of issues in the financial sector and regulation since the financial crisis for the Institute of Actuaries, Trowbridge tackled the complaint made often by Graeme Samuel, chair of the Australian Competition and Consumer Commission, about having to endorse the regional bank takeovers last year.

According to Samuel, in numerous interviews and industry briefings this year, the ACCC only agreed to the Commonwealth Bank takeover of Bank of Western Australia late last year under the sternest advice over the need to do so from APRA and also the Reserve Bank of Australia.

Trowbridge, yesterday, told the actuaries:  "It is odd, incidentally, that the ACCC waved through the Westpac acquisition of St George and then later challenged CBA's acquisition of BankWest.

"As Queen Gertrude said to Hamlet, 'My lady doth protest too much methinks'."

Beyond agency rivalry, Trowbridge's talk was largely a herogram.

"As I see it, our system does work effectively because APRA is a vigilant and effective supervisor."

He acknowledged this was "not always so", a reference to HIH, but said, "APRA now has the resources comprising the experience, culture, competence and strategy to operate effectively.

"Our agency structure, with its national specialist prudential regulator with suitable powers and suitable regulations along with, above all, active supervision, are all well suited to the task. We believe we will continue to be effective as long as APRA remains competent in supervision and vigilant. And that is our primary response to the GFC."