A report by S&P Global Ratings has re-iterated that the Financial Stability Board's crisis management and resolution reforms for banks that emphasise bail-in and not bailout are currently under consideration by most Asia-Pacific governments. "Indeed, to date, Asia-Pacific G-20 countries have deliberately chosen to lag their counterparts in Western Europe and the US in their embrace of the Financial Stability Board's 'Key Attributes of Effective Resolution Regimes'," the S&P Global report observed. "We currently believe that the majority of Asia-Pacific governments will remain supportive toward systemically important banks in the short to medium term and retain a government support option notwithstanding consideration of these reforms." In the ratings agency's view, governments remain supportive for systemically important banks in a majority of Asia-Pacific jurisdictions (15 of 19 countries).  "By contrast, we believe that only three of 24 jurisdictions in North America and Western Europe remain supportive to the extent that bank ratings receive ratings uplift because of government support; with government support considered to be uncertain in the remainder." "At this stage, we see extraordinary support in the region as more likely to be forthcoming from governments rather than from what we term a financial institution's additional loss-absorbing capacity, in a banking crisis," said Gavin Gunning, an S&P Global credit analyst. Australia is no different to the majority of its regional counterparts. Under the current legislative framework, the Australian Prudential Regulation Authority does not have the express power to bail in senior creditors, although it has the power to order that no payment be made on a bond, and can, under the Banking Act, instruct a bank to raise additional capital. "At the same time, we expect that even in the hypothetical scenario that a TLAC framework is implemented, the Australian government is likely to retain - rather than legislatively restrict - its flexibility to bail out a failing bank, if needed," S&P noted. "We see a one-in-three chance of Australia implementing a TLAC framework in the next two years, but a stronger likelihood over a longer horizon. "Nevertheless, the likelihood of implementation of a framework that allows bail-in of senior debt remains low even over a longer horizon. We believe that key drivers of this likely policy direction are the continued dependence of Australian banks on foreign borrowings, and the dominance of the four major banks within the Australian financial system as the main provider of credit to the private sector." And if, against the odds, the Australian government was to reduce its implicit support for the major banks, then they, along with Macquarie Bank and Cuscal would accordingly see their issuer ratings downgraded.