Submissions to APRA regarding the AT1 consultation

Written by Claude Haiku 4.5 from the extracted text on 27 Feb 2026. It can miss or misread redacted and scanned pages. Check the source before relying on it.

This FOI disclosure contains submissions from industry bodies on APRA's proposed changes to bank capital requirements. The Australian Banking Association and Australian Financial Markets Association responded to APRA's proposal to remove Additional Tier 1 (AT1) capital instruments and increase Common Equity Tier 1 (CET1) by 0.25 per cent for Advanced banks and Tier 2 by 1.25 per cent. The ABA acknowledged the proposal's clarity and simplicity but raised concerns about credit rating downgrades for Tier 2 instruments, reduced international comparability of Australia's framework, and potential impacts on investor perception and market access. The ABA recommended retaining a subordinated layer through modified Tier 2 instruments and recalibrating large exposure limits to align with Basel standards. AFMA supported the capital enhancement measures, noting Australia's already strong regulatory framework.