AST ASIC Proposed Revised Bank Code


On Nov. 17, AST ASIC released proposed revisions to banking code.


  • AST ASIC released Consultation paper 373 - proposed changes to the banking code of practice, which seeks stakeholder views on proposed changes to the AST BAC's Banking code of practice in response to an independent review of the code in 2021.
  • In addition, AST ASIC published 4 attachments to the consultation paper, listed below.
  • Follows AST BAC Sep. 2023 submitted proposed bank code to AST ASIC, see #181960.
  • Context
  • AST ASIC does not develop or administer the code; AST BAC is the owner of the code.
  • In addition, AST ASIC explained that its role is to consider whether or not to approve the code using AST ASIC's statutory powers and according to the relevant criteria.
  • It is not mandatory for industry codes to be submitted to AST ASIC for approval; AST ASIC’s approval signals code is one in which consumers, industry can have confidence.
  • Comparison, Proposed Code (Attachments 1-2)
  • Attachment 1 to CP 373: comparison of current code and proposed code provisions has table comparing provisions in current code with proposed code's equivalent provisions.
  • In addition, published Attachment 2 to CP 373: proposed banking code of practice, which contains a copy of the proposed code the AST BAC provided to AST ASIC.
  • Proposed Charter (Attachment 3)
  • Published Attachment 3 to CP 373: proposed BCCC charter; which is revised AST BCCC charter (proposed charter); while AST BCCC charter is related to code, it does not form part of code; is therefore not part of document that AST ASIC considers for approval.
  • However, because the charter contains information relating to AST ASIC's legislative approval criteria for compliance monitoring, it is relevant to AST ASIC's consideration of the code approval application and is included in AST ASIC's public consultation.
  • Proposed Customer Guide (Attachment 4)
  • In addition, AST ASIC published Attachment 4 to CP 373: proposed customer guide. which is a new customer-facing document titled Banking with confidence: your key rights and protections as a customer, which AST BAC has provided to AST ASIC.
  • The proposed customer guide does not form part of the code and is not a document that AST ASIC will consider for approval; however, AST ASIC is publishing proposed customer guide as part of its consult because it considers it will assist stakeholders.
  • Specifically, will assist in forming views on whether code strikes right balance in terms of weighing the goals of simplicity and avoidance of regulatory duplication against consumers’ ability to understand the rights that apply to their banking relationship.
  • AST ASIC Comments
  • This is first time AST ASIC has undertaken a public consult before making a decision on approving the code; AST ASIC said it is seeking to ensure the code continues to provide real benefits to consumers, small businesses, as well as subscribing banks.
  • Specifically, before deciding on whether or not to grant the final approval sought.
  • AST ASIC stated it seeks feedback as well as insights on the following key issues.
  • Whether or not the proposed code imposes obligations on subscribers that are beyond those required by the law and, in doing so, addresses key potential consumer harms.
  • In addition, whether the proposed code provides for effective administrative systems for monitoring compliance and whether the obligations are capable of being enforced.
  • Whether any code review recommendations that the AST BAC has not supported should be included in the proposed code; whether the recommendations accepted by the AST BAC are appropriately reflected in the proposed code and proposed charter.
  • Plus, whether proposed code strikes an appropriate balance between simplifying the code and minimizing regulatory duplication on the one hand, and promoting consumer awareness of protections applicable to their banking relationship on the other.
  • AST ASIC also seeks feedback and insights on key issue of role of industry guidelines.
  • Consultation paper states other key topics for consultation are enhancing guarantor protections; inclusive and accessible banking; customers experiencing vulnerability.
  • Next Steps
  • After AST ASIC's public consultation, AST ASIC will engage with AST BAC to seek any improvements to the proposed code, where appropriate; and it anticipates that the AST BAC will then lodge a formal application for AST ASIC's approval of the code.
  • AST ASIC explained that it will look to make decision on approving code in H1 2024.
  • Effectiveness
  • The comment period for this consultation closes at 11:59pm AEDT on Jan. 15, 2024.

Regulators AST ASIC; AST BAC
Entity Types Bank; CNSM
Reference CP 373, PR 23-306MR, 11/17/2023; ESG
Functions Compliance; Legal; Product Administration; Product Design; Social
Countries Australia
Category National Regulator ; Trade Association
State
Products Banking; Loan
Regions AP
Rule Type Proposed
Rule Date 11/17/2023
Effective Date 1/15/2024
Rule Id 191575
Linked to Rule :181960
Reg. Last Update 11/17/2023
Report Section International

Last substantive update on 11/18/2023