Aust well placed for new regulation, RBA
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SYDNEY, Feb 22 AAP
February 22 2013, 12:53AM
Australia's is well placed to meet new global regulations aimed at boosting the stability of the global financial system, the central bank says.
Reserve Bank of Australia governor Glenn Stevens on Friday told a parliamentary committee the domestic finance sector was preparing for regulations due to take effect over the next decade or so.
They include additional capital ratios for financial institutions under the Basel III bank rules.
"I think Australia is well placed to meet the various rules in ways that are sensible for us. But, it is a major work effort and we have had to devote many more resources to this in the past few years than we used to," he said in Canberra.
"Basically, it is agreed that those entities will hold additional capital and will have resolution plans drawn up and so on, so that the likelihood of a failure is lower and if it does happen it's more easily resolved."
But, Mr Stevens said, the new regulations were likely to have unintended consequences.
"We're doing so much in a short time, there are bound to be unintended consequences. We have to proceed carefully and be prepared to make adjustments if need be."