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Fitch writes "the final Australian loss...>

AUSTRALIA
AUSTRALIA: Fitch writes "the final Australian loss absorbing capacity (LAC)
rules, published on 9 July 2019, represent an easing from the original proposals
published in November 2018 and should allow banks to more easily meet the
requirements, says Fitch Ratings. The biggest change from the November 2018
proposals is to reduce the initial LAC required to 3pp of risk-weighted assets
(RWA) under the current capital framework, from the original 4pp-5pp proposal.
The Australian Prudential Regulation Authority (APRA) has opted to retain the
original proposal that the LAC requirement be met through existing regulatory
capital instruments, which in practice will almost certainly be Tier 2 capital
instruments, and will not include a bail-in function for senior unsecured
instruments."
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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