Overview
The federal government registered a new prudential standard on 7 August 2026. The instrument is titled Banking, Insurance and Life Insurance (prudential standard) determination No. 2 of 2026 and is available at https://www.legislation.gov.au/F2026L01034.
Enabling legislation
The determination is made under the Banking Act 1959, the Insurance Act 1973, and the Life Insurance Act 1995. It is administered by the Department of the Treasury.
What the determination covers
The determination sets rules for large financial groups across the following areas:
- Aggregate risk exposures - requirements around how groups measure and manage combined risk exposures
- Board responsibilities - obligations placed on the boards of entities within scope
- Internal reporting systems - requirements for the systems used to report risk information internally
- Limits and approvals - rules governing exposure limits and the approval processes that apply to them
- Notification requirements - obligations to notify regulators in specified circumstances
Scope
The determination applies to entities operating under the Banking Act 1959, the Insurance Act 1973, and the Life Insurance Act 1995. The source does not specify which particular institutions are affected beyond those general categories of banks, insurers, and life insurers regulated under those three Acts.
Key actions
- Read the full determination at https://www.legislation.gov.au/F2026L01034 to check whether a given entity is captured by its scope.
- Review the sections on aggregate risk exposures policy, board obligations, internal reporting systems, and notification requirements to identify any compliance steps the organisation is required to take.
- Check the explanatory statement available on the same page at https://www.legislation.gov.au/F2026L01034 for plain-language guidance on what the determination requires.
This is a plain-English summary for information only, not legal or compliance advice. Always check the official source or consult a qualified professional.