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					                          1. Please, list all types of institutions – banks, savings cooperatives, investme

  Australia (APRA)
    Austria (FMA)
   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)
   Hungary (FSA)
    Iceland (FME)
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   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
  Singapore (MAS)
United Kingdom (FSA)
s – banks, savings cooperatives, investment service providers, insurers, agents, money brokers, stock exchange, comm




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money brokers, stock exchange, commodity exchange, warehouses, etc. – supervised by your authority. Please, do n
ervised by your authority. Please, do not use merged categories (for example, “deposit-taking institutions”). If not cove
deposit-taking institutions”). If not covered by the list of institutions, please, list activities supervised by your authority
activities supervised by your authority as well.
  Australia (APRA)
    Austria (FMA)
   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)
   Hungary (FSA)

    Iceland (FME)

    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
2. What are the areas, if any, outside the scope of your authority which in your opinion should be

While APRA can put forward views to the Government on these issues, it is ultimately a matter for the Government to decide if




There are no areas which should be included and no areas which should not be included.

The Authority could be given more powers to conclude cases with administrative fines.
The Authority could be given more scope to monitor corporate governance issues of financial services
undertakings and listed companies.




Since the mutual-aid business of agricultural and fisheries cooperatives conduct similar functions as insurance companies that
 opinion should be included under its scope? Or vice versa, which areas under its present scope should not

 Government to decide if it should amend the scope of APRA‟s responsibilities.




nsurance companies that were created under the Insurance Act, we feel that we should also supervise them.
its present scope should not be included?
Australia (APRA)




 Austria (FMA)




Belgium (CBFA)
   Canada (OSFI)




Denmark (Danish FSA)



  Germany (BaFin)




   Hungary (FSA)
Iceland (FME)




Ireland (IFSRA)
     Japan (FSA)




     Korea (FSS)

  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
1. Please, list the laws and regulations relevant to your authority and give a hyperlink

Governing Legislation: Australian Prudential Regulation Authority 1998

Legislation Administered:
• Banking Act 1959
• Financial Sector (Shareholdings) Act 1998
• Financial Sector (Transfers of Business) Act 1999
• Financial Sector (Collection of Data) Act 2001
• Financial Sector (Collection of Data – Consequential and Transitional Provisions) Act
2001
• Insurance Act 1973
• Insurance (Acquisitions and Takeovers) Act 1991
• Life Insurance Act 1995
• Superannuation Industry (Supervision) Act 1993
• Retirement Savings Accounts Act 1997
• Medical Indemnity (Prudential Supervision and Product Standards) Act 2003

Funding:
• Financial Institutions Supervisory Levies Collection Act 1998
• General Insurance Supervisory levy Imposition Act 1998
• Life Insurance Supervisory Levy Imposition Act 1998
• Authorised Deposit-taking Institutions Supervisory Levy Imposition Act 1998
• Authorised Non-operating Holding Companies Supervisory Levy Imposition Act 1998
• Retirement Savings Account Providers Supervisory Levy Imposition Act 1998
• Superannuation Supervisory Levy Imposition Act 1998
• Superannuation (Financial Assistance Funding) Levy Act 1993

Hyperlinks
http://www.apra.gov.au/adi/ADI-Legislation.cfm
http://www.apra.gov.au/General/General-Insurance-Legislation.cfm
http://www.apra.gov.au/Superannuation/Superannuation-Legislation.cfm
http://www.apra.gov.au/Life/Life-Insurance-Legislation.cfm




<http://www.fma.gv.at/en/fma/legalfra/laws/federala.htm>

<http://www.oenb.at/en/ueber_die_oenb/rechtl_grundlagen/rechtliche_grundlagen.jsp>




<http://www.fma.gv.at/en/fma/legalfra/laws/federala.htm>
Bank Act - http://laws.justice.gc.ca/en/b-1.01/219359.html
Bank Act Regulations -
http://laws.justice.gc.ca/en/srch.cgi?part=full&method=and&lang=en&corpus=c_regs&titr
e=Banks%2C+Regulations&query=&x=0&y=0
Insurance Companies Act - http://laws.justice.gc.ca/en/i-11.8/244074.html
Insurance Companies Act Regulations -
http://laws.justice.gc.ca/en/srch.cgi?part=full&method=and&lang=en&corpus=c_regs&titr
e=Insurance+Companies%2C+Regulations&query=&x=0&y=0
Trust and Loan Companies Act - http://laws.justice.gc.ca/en/t-19.8/263006.html
Trust and Loan Companies Act Regulations –
http://laws.justice.gc.ca/en/srch.cgi?part=full&method=and&lang=en&corpus=c_regs&titr
e=Trust+and+Loan+Companies%2C+Regulations&query=&x=0&y=0
Office of the Superintendent of Financial Institutions Act - http://laws.justice.gc.ca/en/O-
2.7/index.html
Office of the Superintendent of Financial Institutions Act Regulations –
http://laws.justice.gc.ca/en/srch.cgi?part=full&method=and&lang=en&corpus=c_regs&titr
e=Office+of+the+Superintendent+of+financial+institutions%2C+Regulations&query=&x=
0&y=0 ; http://laws.justice.gc.ca/en/o-2.7/sor-2001-177/155117.html
Cooperative Credit Associations Act - http://laws.justice.gc.ca/en/c-41.01/229733.html
Cooperative Credit Associations Act Regulations -
http://laws.justice.gc.ca/en/srch.cgi?part=full&method=and&lang=en&corpus=c_regs&titr
e=cooperative+credit+associations%2C+regulations&query=&x=0&y=0
Pension Benefits Standards Act - http://laws.justice.gc.ca/en/p-7.01/257931.html
www.finanstilsynet.dk/English/legislation
Kreditwesengesetz (German Banking Act) http://intranet:8071/gesetze/kwg.htm
Versicherungsaufsichtsgesetz (German Insurance Supervision Law)
http://intranet:8071/gesetze/vag.htm
Wertpapierhandelsgesetz (Securities Trading Act)
http://intranet:8071/gesetze/wphg_en.htm

Act CXXIV of 1999 on Hungarian Financial Supervisory Authority (HFSA)
Act CXII of 1996 on credit institutions and financial undertakings
Act CXX of 2001 on Capital Market
Act LX of 2003 on insurance and insurers
Act LXXXII of 1997 on mandatory pension funds
Act XCVI of 1993 on voluntary pension funds
Act XLVIII of 1996 on public warehouses
Act XXXIV of 1998 on venture capital
Acts on different, individually regulated specialised credit institutions such as Hungarian
Development Bank, Eximbank, etc.
(No hyperlinks.)
a) Law on Official Supervision of Financial Operation no. 87/1998
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1169
b) Act on Payment of Cost due to Official Supervision of Financial Activities no. 99/1999
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1185
c) Act on Financial Undertakings no. 161/2002
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1263
d) Act on Securities Transactions no. 33/2003
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1269
e) The Act on the Mandatory Guarantee of Pension Rights and the Operation of Pension
Funds no. 129/1997
http://eng.fjarmalaraduneyti.is/legislation/nr/817#Act
f) Act on Insurance Activities, with amendments, no. 60/1994
http://www.fme.is/fme-
eng.nsf/0/194CD9DAB087578800256F2C004A6824/$file/Actoninsurance_no60_1994.p
df
g) Act on Undertakings for Collective Investment in Transferable Securities (UCITS) and
Investment Funds no. 30/2003
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1268
h) Act on Activities of Stock Exchanges and Regulated OTC markets no. 34/1998
http://eng.idnadarraduneyti.is/laws-and-regulations/nr/1156
i) Act on Insurance Intermediation no. 32/2005

Central Bank and Financial Services Authority of Ireland Act 2003 (“2003 Act”).
Central Bank and Financial Services Authority of Ireland Act 2004 (“2004 Act”),
For further information access http://www.financialregulator.ie and go to legislation.

Legislative Basis for Financial Regulator‟s Supervisory Functions

This list contains the principal items of legislation as at 31 December 2005 and refers to
them in their current form, as amended and updated. This list does not, therefore,
contain related enactments which effect any such amendment, or commencement
provisions. www.irishstatutebook.ie
     <The list of main laws>
Banking Law
Insurance business Law
Securities and Exchange Law
Investment Trust Law
Investment Advisory Business Law
Financial Futures Trading Law
Trust Business Law
Law for Foreign Securities Companies,        etc

Note)
Bill for “Financial Services and Exchange Law” has just been sent to the Diet. This bill
plans to amend Securities and Exchange Law, and Investment Advisory Business Law,
Financial Futures Trading Law, and Law for Foreing Securities Companies will be
integrated to Financial Services and Exchange Law.
nvestment Advisory Business Law, Financial Futures Trading Law, and Law for Foreing
Securities Companies will be integrated to Financial Services and Exchange Law.
aw for Foreing Securities Companies will be integrated to Financial Services and
Exchange Law.
ervices and Exchange Law.
The basic contents of legislations (the bill for “Financial Instruments and Exchange
Law”) are as follows.
 for “Financial Instruments and Exchange Law”) are as follows.
ments and Exchange Law”) are as follows.
”) are as follows.
(1) Establishing cross-sectional framework of a wide range of financial instruments
(2) Enhancing disclosure requirements (Introduction of a statutory quarterly reporting
(3) Increasing the maximum criminal penalties against various market frauds and
expanding the scope of penalties against “misegyoku”

(4) Providing organization structures for self-regulatory functions of exchanges in the
form of stock corporations

The Act for the Establishment of Financial Supervisory Organizations (thereinafter
Establishment Act). Please refer to the Korea Legislation Research Institute‟s website
(KLRI, www.klri.re.kr).




MAS‟ governance structure, functions and powers are enshrined in the MAS Act. In
carrying out its functions as a regulator of the financial services industry, MAS also issue
various instruments under Acts administered by MAS.
MAS Act
http://agcvldb4.agc.gov.sg/non_version/cgi-bin/cgi_retrieve.pl?actno=REVED-
186&doctitle=MONETARY%20AUTHORITY%20OF%20SINGAPORE%20ACT%0a&dat
e=latest&method=part
Other laws and regulations
The hyperlinks to other relevant laws and regulations can be found at the MAS website
(www.mas.gov.sg) under “Legislation, Notices, & Guidelines”.
   Australia (APRA)




    Austria (FMA)
   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)


   Hungary (FSA)


     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
2. Please, describe your authority's institutional and legal status (public or private institution, etc.

APRA was established in 1998 as an independent statutory authority charged with responsibility for prudential
regulation of the financial sector. APRA is both independent from, and accountable to, the Australian
Government. Its governing legislation is the Australian Prudential Regulation Authority Act 1998.

It is a corporate structure and is covered under the Commonwealth Authorities and Companies Act 1997 (CAC
Act). CAC Act agencies typically manage their own money and are generally funded on a commercial basis
under the direction of a board. APRA is under the direction of a minimium of three and a maximium of five
statutory appointees (termed members), one of whom is appointed full time chairman.
The Austrian Financial Market Authority is an autonomous institution under public law with its own legal personality. In performi

OSFI was established in 1987 by an Act of Parliament: the Office of the Superintendent of Financial Institutions Act. OSFI supe
Finanstilsynet is a public institution
BaFin is a public-law institution with legal capacity answerable directly to the Federal Government. It is subject to the legal and
The HFSA is a public organisation under direction of the Government and under the supervision of the Minister of
Finance. Tasks and responsibilities of the HFSA are set by acts, in its responsibilities the HFSA shall not be
ordered. Supervisory role of the Minister of Finance covers the followings:


The Financial Supervisory Authority (FME) is an independent state authority which conducts its business on the grounds of the
The Irish Financial Services Regulatory Authority (Financial Regulator) is a public sector organisation. The Financial Regulato
The FSA is an administrative organ (an external organ of the Cabinet Office).
No-capital special corporation (§24-2, Establishment Act)




MAS is established as a statutory board under the MAS Act to perform the functions of central banking and financial supervisio
vate institution, etc.).




al personality. In performing its duties, it is not bound by any instructions (Section 1 of the Austrian Financial Market Act)

nstitutions Act. OSFI supervises and regulates all banks in Canada and all federally incorporated or registered trust and loan companies, ins

s subject to the legal and functional supervision of the Federal Ministry of Finance




ess on the grounds of the Law on Official Supervision of Financial Operation no. 87/1998.
  The Financial Regulator was formally established by Statute on 1 May 2003 as the single regulator for financial services in Ireland under th




g and financial supervision.
ncial Market Act)

stered trust and loan companies, insurance companies, cooperative credit associations, fraternal benefit societies and pension plans. The O




 financial services in Ireland under the Central Bank and Financial Services Authority of Ireland Act, 2003. It is an independent component p
t societies and pension plans. The OSFI Act provides that the Minister of Finance is responsible for OSFI. It also provides that the Superint




3. It is an independent component part of the Central Bank and Financial Services Authority of Ireland (CBFSAI) and has its own independe
FI. It also provides that the Superintendent is solely responsible for exercising the authorities provided to him by the financial legislation and




(CBFSAI) and has its own independent Board of Directors.
o him by the financial legislation and is required to report to the Minister of Finance from time to time on the administration of the financial ins
the administration of the financial institutions legislation.
                          3. Please, describe legal status of the staff members (civil servants, etc.).
                          Staff member’s status
                          Not civil servants.


   Australia (APRA)




                          28 civil servants,
                          16 officials of contracts,
    Austria (FMA)         161 private employees

   Belgium (CBFA)
    Canada (OSFI)         Civil servants
Denmark (Danish FSA)      Civil servants
  Germany (BaFin)         Civil servants
   Hungary (FSA)          Civil servants
    Iceland (FME)         Civil servants
                          Public sector employees.
   Ireland (IFSRA)

     Japan (FSA)          National public servants
                          Non-civil servants
     Korea (FSS)

  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
                          Public servants.
   Singapore (MAS)

United Kingdom (FSA)
ers (civil servants, etc.).
            Remarks
            All APRA staff are hired under the APRA Act 1998,
            which gives APRA the power to engage staff under its
            own employment terms and conditions. While APRA
            staff are public sector employees, they are not civil or
            public servants engaged under a Public or Civil Service
            Act with employment arrangements determined by a
            central agency.



            As of March 31, 2006. Every new staff employed are exclusively private employees.




            The Central Bank and Financial Services Regulatory
            Authority of Ireland is a public sector organisation and
            as such its staff are public sector employees.

            However, we are treated as civil servants when penal
            clauses of the Criminal Law and other relevant acts are
            applied (§69-2, Establishment Act).



            Under the MAS Act, all staff, including directors, are
            deemed to be public servants.
Australia (APRA)




 Austria (FMA)
Belgium (CBFA)




Canada (OSFI)
Denmark (Danish FSA)
Germany (BaFin)
Hungary (FSA)




Iceland (FME)
   Ireland (IFSRA)




     Japan (FSA)


     Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
4. Please, explain the mission statement and/or objectives and/or strategy of your authority.

Our Vision is to be a world-class integrated prudential supervisor recognised for its leadership, professionalism
and innovation.

Our Mission is to establish and enforce prudential standards and practices designed to ensure that, under all
reasonable circumstances, financial promises made by institutions we supervise are met within a stable, efficient
and competitive financial system.

Our Values are underpinned by the highest standards of individual and corporate integrity, as well as by flexibility,
openness and accountability.

Our supervisory approach is forward-looking, primarily risk based, consultative, consistent and in line with
international best practice. The approach also recognises that management and boards of supervised institutions
are primarily responsible for financial soundness.

These statements reflect the fact that prudential regulation of the Australian financial system aims to ensure that,
under all reasonable circumstances, financial promises made by regulated entities are met within stable, efficient
and competitive markets. It is aimed at ensuring that the quality of a financial institution‟s systems for identifying,
measuring and managing the various risks in its business act to reduce the risk of failure and that where failure
does occur, public confidence in the financial system is maintained while the entity makes an orderly exit.

Mission Statement of the FMA
The FMA is an independent, autonomous and integrated supervisory authority for the Austrian Financial Market,
established as an institution under public law. It is responsible for the supervision of credit institutions, insurance
undertakings, pension funds, staff provision funds, investment funds, investment service providers, companies
listed on the stock exchange as well as stock exchanges themselves.
The aims of the FMA are:
• to contribute toward the stability of Austria as a financial market;
• to reinforce confidence in the ability of the Austrian financial market to function;
• to protect in accordance with provisions of law investors, creditors and consumers;
• and
• to put forth preventive efforts with respect to compliance with supervisory standards while consistently punishing
any violations of these standards.

In order to achieve these aims:
• the FMA monitors and takes any measures necessary to ensure compliance with provisions of law;
• the FMA defines minimum standards and publishes regulations putting legal provisions into concrete terms;
• in dialogue with market participants the FMA works out proposals for ensuring that the Austrian financial market
permanently adheres to high standards;
• the FMA represents Austria's interests in EU and other international bodies and supports cooperation with other
supervisory authorities;
• the FMA utilises and further develops modern analysis systems;
• the FMA places great emphasis on employing highly qualified and motivated staff as well as deploying the most
modern technology; and
• its staff work as a team toward solving problems in a holistic manner so as to accomplish its integrated
supervisory tasks efficiently and effectively.

We as staff members of the FMA identify with these aims and base our actions on the values of independence
and objectivity. We fulfil our commission with confidence and in the knowledge of the significance of our efforts
for the Austrian financial market.
OSFI Mandate

OSFI was created to contribute to public confidence in the Canadian financial system. Under our legislation our
mandate is to:

• Supervise federally regulated financial institutions and private pension plans to determine whether they are in
sound financial condition and meeting minimum plan funding requirements respectively, and are complying with
their governing law and supervisory requirements;

• Promptly advise institutions and plans in the event there are material deficiencies and take, or require
management, boards or plan administrators to take, necessary corrective measures expeditiously;

• Advance and administer a regulatory framework that promotes the adoption of policies and procedures
designed to control and manage risk;

• Monitor and evaluate system-wide or sectoral issues that may impact institutions negatively.

In meeting this mandate, OSFI contributes to public confidence in the financial system. OSFI's legislation also
acknowledges the need to allow institutions to compete effectively and take reasonable risks. It recognizes that
management, boards of directors and plan administrators are ultimately responsible and that financial institutions
and pension plans can fail.

The Office of the Chief Actuary (OCA), which is part of OSFI, provides actuarial services to the Government of
Mission
• Finanstilsynet contributes to the mission of the Ministry of Economic and Business Affairs to create future-
oriented conditions for growth for citizens and companies in an increasingly globalised world.
• Finanstilsynet contributes by assisting in preserving confidence in the Danish financial sector by citizens and
companies in Denmark and abroad.

Vision
• Finanstilsynet contributes to the vision of the Ministry of Economic and Business Affairs to achieve the best
conditions for growth in Europe in order to make Denmark an attractive place to live, work and run a company.

• Finanstilsynet contributes by discouraging that a lack of confidence in the Danish financial firms should emerge,
leading to the firms being unable to take on new risks sufficiently.

Values
• Our achievements make a difference.
• We show energy
• We focus on quality
• We listen to every one and think coherent
• We create a good working environment

Description of the Values
The achievements of Finanstilsynet make a difference, because:
- we contribute to keep the probability of default of financial firms at a prudent level and to the clients of the
financial sector receiving a safe and proper treatment
- our supervisory activities are risk-based with a focus on the areas where the risk or the consequences of non-
compliance are material
- our regulatory activities aim at striking a proper balance between the financial firms fulfilling their existing
obligations and undertaking new risks
- we use only the resources absolutely needed for a prompt and correct consideration of the cases

Finanstilsynet shows energy because we do not hesitate:
- when rules and regulations are not complied with
- if improved regulation is needed
BaFin‟s key tasks, and thus its aims, include
• promoting and maintaining the stability and integrity of the companies under supervision,
• promoting and maintaining the functionality of the financial and securities markets,
• strengthening Germany as a centre of finance,
• protecting investors and clients.


These aims derive primarily from the laws on supervision, which provide the basis and principles for BaFin‟s
supervisory activities.

In order to fulfil its tasks as required by the legislature, BaFin must pursue two further internal aims. At all times it
must

• operate in an economically sound manner, and
• both ensure and develop the organisation‟s ability to act.


At a strategy meeting, the management and the Chief Executive Directors adopted ten strategies which define
the best way for BaFin to achieve the external and internal aims listed above.
The ten strategies are to be principles that will define the future work of the entire BaFin organisation. Their
wording is therefore deliberately abstract. However, implementation of these principles will quickly give rise to
specific strategic measures, which will accommodate the specific needs of the individual sections.

STRATEGIES

Strategy 1: Supervision that is competent, service-oriented and open to dialogue
• Communication between the supervisory authority and the business community is not theoretical, it is de facto a
component of supervision. BaFin should not treat the companies under its supervision as objects of supervision
only. It should also recognise them as clients and partners, and request their input in matters of current
supervision and legislative development.
• BaFin contributes in a large way to the promotion of the German market through prompt processing of
applications and by providing competent answers to questions from companies.
Strategy:
Mid-term – up to 2010 - strategy of the HFSA in brief: “Efficient Supervision”.
The primary aim of the strategy is to catch up with the international development of financial activities and
supervisory methodology. This requires a more target oriented and more efficient utilization of the available
resources. The strategy is based on the basic tasks of the Supervision as set out in the legislation, primarily to
ensure the lawful, reliable, continuous and transparent operation of the financial markets.

The main factors that – according to the HFSA‟s assessment - affect the performance of its tasks during the
following years: international trends, growth of the world economy, expected conflicts, increasing financial wealth,
technological progress, expanding product range, complexity of the institutional structure, international services,
European integration as well as the situation of Hungary including the situation of the Hungarian financial sector.
At the same time, the strategy also takes stock of the Supervision‟s resources including its human, financial and
tangible resources. In addition, the mid-term planning analyzes organizational and governance issues,
cooperation and includes an assessment of the information system.

Indispensable actions set by the strategy: responsiveness, ongoing and substantive supervision, analysis of
professional relationships, strengthening of the international aspects of supervision, implementation of EU
regulation, active influence to improve market transparency and, adequate utilization of resources.

The fulfillment of the strategy is aided by various actions: creation of a new, up-to-date human resource policy,
creation of effective resource allocation, development of the methodology, establishment of IT awareness in
supervision, transformation of organization and management conditions and of the working culture.

The strategy is the point of reference relative to which we can measure the development of the Supervision,

Mission statement and values respected by the HFSA

As a member of the supervisory community of the European Union and in an integrating financial market, the
HFSA shall




The FME refers to answers to question 5 in the questionnaire on Quality Management.
FME uses the methodology of Kaplan and Norton, The Balanced Scorecard. The balanced scorecard is a
management system (not only a measurement system) that enables organizations to clarify their vision and
strategy and translate them into action. It provides feedback regarding both the internal business processes and
external outcomes in order to continuously improve strategic performance and results. The balanced scorecard
suggests that the organization is viewed from four perspectives, and develops metrics, collects data and analyzes
it relative to each of these perspectives.
The mission of the Financial Regulator is to help consumers make informed financial decisions in a safe and fair
market and to foster sound dynamic financial institutions in Ireland, thereby contributing to financial stability. Our
mission is based on the fact that consumers face a number of risks when purchasing a financial service, namely:
• Risk that a financial service provider may be unable to return funds due to insolvency;
• Risk that a financial service provider may behave unethically or irresponsibly;
• Risk that products may be mis-sold; and
• Risk that the product may not suit individual circumstances.

Our vision is to have made a positive and real impact on the financial services industry, consumers of financial
services and our stakeholders by the end of 2006. We are working towards achieving this in two ways:

• For the consumer who will have more and better information in a safe financial market which is fairer and gives
better value;
• For the industry which will operate in a cost effective and responsive regulatory system that facilitates
innovation, competitiveness and growth both in Ireland and internationally.

In our first Strategic Plan (2004-2006), we identified the following seven high level goals and associated strategies
to address both our mandate and the building of the new organisation in the medium term:

• Helping consumers to make informed choices through education and codes of practice in a fair financial
services market.
• Having a regulatory system that fosters safe and sound financial institutions while operating in a competitive and
expanding market of high reputation.
• Developing an appropriate regulatory system for credit unions.
• Developing an adaptable, efficient and flexible organisation with motivated and skilled staff.
• Continuously enhancing and developing the regulatory system.
      The FSA is responsible for ensuring the stability of the financial system in Japan, protection of depositors,
insurance policy-holders and securities investors, and smooth finance function through such measures as
planning and policymaking concerning the financial system, inspection and supervision of private-sector financial
institutions and surveillance of securities transactions, and performs extremely important roles for the sound
development of the national economy.
By establishing a sound credit system, promoting fair business practices, and protecting financial consumers
such as depositors and investors, we will contribute to the development of the national economy (§1,




The mission of MAS is “to promote sustained and non-inflationary economic growth, and a sound and progressive
financial centre”.
The objectives of MAS‟ supervisory activities are:
• a stable financial system;
• safe and sound financial intermediaries;
• safe and efficient financial infrastructure;
• fair, efficient and transparent organised markets;
• transparent and fair-dealing intermediaries and offers; and
• well-informed and empowered consumers
our authority.
  Australia (APRA)




   Austria (FMA)




  Belgium (CBFA)

   Canada (OSFI)




Denmark (Danish FSA)

  Germany (BaFin)




   Hungary (FSA)
    Iceland (FME)




   Ireland (IFSRA)




     Japan (FSA)




     Korea (FSS)


  Netherlands (DNB)

Norway (Kredittilsynet)

     Sweden (FI)

   Singapore (MAS)
Yes


Yes

Yes
Yes
Yes
Yes
Yes



Yes


Yes




Yes
Yes


Yes




Yes
Yes
United Kingdom (FSA)
5. Please, explain, what kind of legal powers does your authority
have? Please indicate the area as well if it is not with general
relevance - for example: to issue decree on reporting but not
that regarding other areas. Please, use the table below.

Approve or suspend/withdraw licences including authorisation of entities that
are regulated by way of registration, approval or recognition, etc)
Yes




                                         Yes
The FMA licenses credit institutions, insurance companies, pension funds,
investment firms and stock exchanges (except for commodities).




Yes
OSFI reviews incorporation requests and makes recommendations to the Minister
of Finance who decides whether to issue letters patent that officially incorporate the
new entity. The new entity cannot commence business however until OSFI has
issued an order to commence and carry on business. In the case of a foreign
branch application, OSFI would make a recommendation to the Minister who would
decide whether to grant the foreign entity access to the Canadian market via a
branch operation. The branch would not be able to commence business until OSFI
issued an order to commence and carry on business. At any time, OSFI can
amend or revoke the business authorization of a company.

Yes

Yes
The permission of BaFin is necessary for transactions and financial services,
unless the company which has the relevant permission of another EU member
state. These companies only need to provide notification of their activity in
Germany.




Y
In case of banks, withdrawal of licence is a common decision of the HFSA, the
National Bank of Hungary and the Ministry of Finance.
Yes/No
Yes regarding banks, savings banks, securities companies, operation of
Undertakings for Collective Investment in Transferable Securities (UCITS) and for
insurance brokerage for approval and suspension/withdrawal of licences. No
regarding approving or suspend/withdraw of licence for insurance companies. It is
the Minister of Commerce that both approves and suspends/withdraws licences
after the FME has either endorsed the application for license or proposes that the
operating licence should be revoked.     No, regarding Pension Funds. It is the
Ministry of Finance that approves and suspends/withdraws licences of Pension
Funds.




Yes




The Financial Regulator has the power to approve, suspend and revoke licences of
all authorised institutions. However, the grounds upon which the approval,
suspension or revocation of licences varies between the various pieces of
legislation, which apply to these, authorised institutions. Procedures that must be
followed by the Financial Regulator in exercising its powers may also vary. If, in
any case where the Financial Regulator proposes to issue, revoke or suspend a
licence, a matter relating to the financial stability of the State's financial system
arises, the Financial Regulator must consult with the Governor of the Central Bank,
and, if the Financial Regulator considers it prudent, it may send a report to the
Minister for Finance. The Financial Regulator may otherwise act on that matter only
with the agreement of the Governor.
Yes
Article 26 and Article 27 of the Banking Law stipulates suspension of banking
business and revocation of banking license. Article 132 and Article 133 of the
Insurance Business Law stipulates suspension of activities and withdrawal of
authorization.
Yes




Yes
[Internal note: There are express provisions on the power to suspend licences in
the FAA, SFA and TCA. Under section 49 of BA and section 41 of IA, MAS may
require any bank or insurer to take any action or to do or not to do any act or thing
(e.g. restrict or suspend the institution's activities) as MAS may consider necessary
where certain conditions are fulfilled.




Yes


Yes

Yes
Yes
Yes
Yes
Yes



Yes


Yes
2) There are no provisions in BA on removal unless section 49 is invoked. We will
be amending the BA in the next round of amendments to provide for removal.
Currently, the removal of officers can be provided for under the banking
regulations.]
Yes
Yes


Yes




Yes
Yes
Yes
Yes
Yes
Yes
Approve mergers or major investments
Yes




                                       Yes
The FMA has to approve mergers of or major investments into the above mentioned
enterprises.




Yes
In the case of a merger or major investment, OSFI would opine on the safety and
soundness of the proposed deal. The Competition Bureau would opine on the
competitive impact. In the case of mergers, the Minister of Finance would consider
public policy issues when making the final decision.




Yes

No
There are certain risk limitation regulations, whihc only allow a company individual large
loans, including participating interests, up to a level of 25 % of its liable equity capital.
There are also limitation regulations for the overall level of large loans. Mergers of
institutions are not subject to approval. Of course, to retain the permission the merged
company must continue to meet the legal requriements relating to equity capital,
management and business organisation.           According to the Securities Acquisition and
Takeover Act, BaFin can prohibit a takeover bid if the bid documentation does not
contain the information required by law or if the bidder does not publish the bid
documentation in the prescribed form.
Y
In case of mergers, approval by the Competition Office is necessary as well.
Yes/No
Yes regarding mergers. The FME does not have to approve major investments but the
investment must be in conformity with authorised ancillary activities.




Yes




Yes

Article 30 of the Banking Law stipulates approval of merger and transfer or acquisition of
operation and business. Article 142 of the Insurance Business Law stipulates approval
of disposal or acquisition of business.
Yes




Yes
[Internal note: For major investments, only the BA has specific provisions on this. For
SFD and ID entities, such conditions are typically imposed as part of approval of licence.
Please also see comments in (c) below. ]

[Internal note: There are express provisions on the power to suspend licences in the
FAA, SFA and TCA. Under section 49 of BA and section 41 of IA, MAS may require any
bank or insurer to take any action or to do or not to do any act or thing (e.g. restrict or
suspend the institution's activities) as MAS may consider necessary where certain
conditions are fulfilled.
[Internal note: For major investments, only the BA has specific provisions on this. For
SFD and ID entities, such conditions are typically imposed as part of approval of licence.
Please also see comments in (c) below. ]
[Internal note: Note that most of the Acts do not provide for material changes thereafter,
unless it has been imposed as a condition of the approval.]
[Internal note: The proposed answer is in relation to FHCs.]




[Internal note: Section 55 BA does not allow MAS to issue directions to be imposed on
individual banks. However, MAS may do so under Section 49, if the conditions set out in
Section 49 are fulfilled. We will be amending the BA in the next round of amendments to
apply section 55 to individual banks.]
[Internal note: 1) In some of the Acts (e.g. MCRBA (s26), FAA (s48), MAS does not have
the power to approve auditors but auditors have to fulfil certain conditions before they can
act as an auditor for the licensed entity.




Criminal actions are initiated by the Attorney-General's Chambers.
[Internal note: There are no specific provisions in the MCRBA.]
[Internal note: The right to share is not unfettered. There are also no specific provisions
in the Act providing for the power to share information, however, disclosure is permitted
under common law and if certain conditions are fulfilled.]
[Internal note: Please note that the Acts are not so clear on this point Section 43 BA
allows MAS to inspect books, accounts of a branch outside Singapore opened by a bank
incorporated in Singapore. The IA, SFA do not specifically state that MAS may inspect
overseas branches. However, there are provisions which permit MAS to obtain
information relation to the operations of a foreign branch (e.g. section 33 IA, sections 20,
67 SFA on information gathering). Please also note that any supervision would be
subjected to the laws of the foreign countries.]
[Internal note: There are no provisions on MAS's power to take control in the IA (but MAS
may issue directions) and MCRBA. In the SFA, MAS has emergency powers (section 34]
Approve significant ownership or controlling interests in the institutions or any
material changes thereafter
Yes




                                              Yes




Yes
Although significant ownership or controlling interests require Ministerial approvals, OSFI
reviews the applications and makes recommendations to the Minister.




Yes

Yes
There is a duty to provide notification and the possibility of prohibiting the acquisition of an
important participation (participation over 10%) in an company, if the acquirer of th
eimportant participation is not adequately reliable, the participation capital probably
originates from a criminal act or as a result of the participation the institution is integrated
into a non-transparent group or participations.




Y
Yes.
If the ownership or controlling interests exceeds 10%, 20%, 33% or 50%.




Yes




Yes

Article 52-9 of the Banking Law stiupulates approval of significant shareholders of a bank.
Article 271-10 of the Insurance Business Law stipulates approval of significant
shareholders of an insurance company.
Yes
We set eligibility requirements for the management of financial institutions and their
largest shareholders and require them to report significant changes.




Yes
[Internal note: Note that most of the Acts do not provide for material changes thereafter,
unless it has been imposed as a condition of the approval.]
Approve and impose conditions on the organisation of financial
conglomerates (ownership structure)
Yes
See question 11 for further details.



                                         Yes




Yes
Although the final decision to incorporate a company rests with the Minister of
Finance, the Minister takes into account OSFI's opinion on the supervisibility of the
proposed ownership structure.




Yes

Yes
Changes in the shareholder, organisational or management structure of regulated
entitites in a financial conglomerate require the approval or authorisation of
competent authorities.




Y
Mainly by the chanels mentioned in the first three lines.
Yes
The FME can impose conditions. The organisation of the conglomerates may not
hinder financial supervision. The FME must approve qualified holdings.




Yes




Yes

Article 52-23 of the Banking Law stiupulates scope of bank subsidiaries. Article
106 of the Insurance Business Law stipulates scope of insurance company's
subsidiary.
Yes




Yes
[Internal note: The proposed answer is in relation to FHCs.]
Inspect and have unfettered access to the institution's premises and records
Yes
There are threshold triggers APRA must meet.



                                          Yes
Certain on-site inspections with credit institutions are performed by the Austrian
Central Bank based on a mandate by the FMA.




Yes




Yes

Yes
Both by own staff and by mandated professional third parties, such as auditors.




No.
The HFSA has no criminal power, it is not empowered to investigate. However, the
HFSA is empowered to ask for any records and for any business information.
Yes
The FME may perform on-the-spot checks in such manner and as often as it
deems necessary.




Yes




The powers of the Financial Regulator and the procedures required to be followed
in relation to inspection powers may vary in accordance with the provisions of the
relevant piece of legislation. i.e. the type of institution involved.
Yes


Article 25 of the Banking Business Law and Article 129 of the Insurance Business
Law stipulates on-the-spot inspection.
Yes




Yes
Request information in such form and at such frequency that the supervisor
deems necessary
Yes
There are threshold triggers APRA must meet.



                                         Yes




Yes




Yes

Yes
Right to provision of information at any time and submission of business
documentation. In addition, legally regulated regular reporting obligations.




Y
Rules on regular reports are set in decrees issued by the MoF. Individual requests
are managed in supervisory resolutions or simply in form of written requests (via e-
mails, phone, consultations, etc. as well).
Yes
The FME may request information in such manner and as often as it deems
necessary.




Yes




Depending on the type of institution, the frequency can vary from monthly to annual.
Yes


Article 24 of the Banking Business Law and Article 128 of the Insurance Business
Law stipulates submission of reports or documents.
Yes




Yes
Issue regulations/ directions/ notices or any other instruments imposing
regulations
Yes
Prudential standards and directions.



                                        Yes
The Austrian Central Bank is heard prior to the issuing of regulations of the FMA
regarding banking supervision. Very few regulations are still issued by the Ministry
of Finance (cfr Section 78 of the Banking Act). Additionally the FMA issues soft-law
instruments (standards, notices, recommendations).




Yes
Given that regulations are statutory instruments, the power to make regulations
lies with Parliament/Governor in Council. OSFI plays a key role in the drafting of
regulations which are reviewed by the Department of Finance then passed onto
Parliament for final approval by the Governor in Council. OSFI has the power to
issue Guidelines (e.g., Capital Adequacy Guideline), policy papers, rulings.




Yes

Yes
BaFin has the authority to issue legally binding ordinances, if it has expressly been
assigned these powers for specific areas by formal legislation (e.g. regarding
capital requirements).BaFin can also publish guidelines for the more precise
determination of legal requirements, which more or less amounts to a „Best
Practice Regulation”.




No.
Yes/No
It is the Ministry of Commerce that issues regulations. The FME can issue
directions/notices/guidance. The FME can also issue rules based on laws and
regulations.




Yes




Yes




Yes




Yes
Issue regulations/ directions/ notices or any other instruments imposing
requirements on specific institutions
Yes




                                        Yes




Yes
OSFI can issue directions of compliance imposing requirement on specific
institutions.




Yes

Yes
On the basis of the Insurance Supervision Law, the German Banking Act and the
Securities Trading Act BaFin has extensive authorisation relating to measures in
respect of individual institutions to safeguard proper management and to safeguard
the assets entrusted to the company.




Y
Cases when this is possible are set in the sectoral acts. These sort of requests are
explained in supervisory resolutions.
Yes.
The FME can impose directions/ notices or other requirements on specific
institutions if necessary.




Yes




In most cases, primary legislation is required in order to empower the Financial
Regulator to issue regulations. The approval of the Minister for Finance or the
Minister for Enterprise, Trade and Employment may be necessary prior to issuing
regulations. The Financial Regulator may also issue Guidance Notices or other
administrative notices if permitted by primary legislation. Such Guidance Notices
or administrative notices are generally applicable to a certain class or category of
financial institutions, e.g. credit institutions, custodians or prime brokers. The
Financial Regulator may issue, in addition, directions to specific financial
institutions in accordance with the provisions contained in primary legislation.
Yes




Yes

We can take administrative actions on certain companies.




Yes
[Internal note: Section 55 BA does not allow MAS to issue directions to be imposed
on individual banks. However, MAS may do so under Section 49, if the conditions
set out in Section 49 are fulfilled. We will be amending the BA in the next round of
amendments to apply section 55 to individual banks.]
Approve appointment of/ remove directors/ officers/ auditors
Yes




                                      Yes
Directors (members of the executive board): Yes. Auditors: The FMA can challenge
the nomination of bank and insurence auditors in front of civil courts.




Yes
Although OSFI does not approve the appointment of directors, officers or auditors,
it does have the ability to disqualify and remove directors/senior officers and to
revoke the appointment of an auditor.




Yes

Yes
BaFin has the authorisation to remove unreliable or unqualified managers and to
refuse unsuitable auditors of a company. BaFin has no authority to take measures
in relation to the supervisory bodies of a company (Administrative Council or
Supervisory Board).




Y
Principle of proportionality shall be taken into account.
Yes/No
The FME has to approve the appointment of directors but not officers and auditors.
The FME also has to approve the appointment of an actuary of an insurance
company and accredit an actuary for a Pension Fund.        The FME has a special
fit-and-proper test (questionnaire and an exam) for new directors to decide if they
are qualified.      The FME does not have to approve the removal of directors.




Yes




Yes


No approve of appointment, but Article 27 of the Banking Law stipulates dismissal
any of the members of its board of directors or auditors.
Yes
Related acts have minimum requirements for officers and we can also recommend
an officer's discharge.




Yes
[Internal note: 1) In some of the Acts (e.g. MCRBA (s26), FAA (s48), MAS does not
have the power to approve auditors but auditors have to fulfil certain conditions
before they can act as an auditor for the licensed entity.   2) There are no
provisions in BA on removal unless section 49 is invoked. We will be amending the
BA in the next round of amendments to provide for removal. Currently, the removal
of officers can be provided for under the banking regulations.]
Ability to impose administrative sanctions (fines/ penalties) and/or initiate
criminal action
Yes




                                          Yes
The FMA can impose administrative sanctions. It is not competent to initiate
criminal proceedings but is obliged to request to the public prosecutor if evidence
in its possession points to a crime or a criminal offence being committed.




Yes




Yes

Yes
BaFin has the authority to warn managment and to impose fines on the
management and the company itself and has the right to file a compaint to the
criminal investigation authorities. The Supervision Laws permit the imposition of
fines. When there is suspicion of insider trading and market manipulation, BaFin is
obliged to notify the criminal investigation authorities.




Y
Yes
The FME may resort to sanction in the form of daily fines. The daily fines can
amount to IKR 10.000-IKR 1.000.000. The FME can also impose administrative
fines. The administrative fines can be between IKR 10.000-IKR 2.000.000.




Yes




The Financial Regulator has the power to impose administrative sanctions in
respect of prescribed contraventions by regulated institutions and persons
connected with the management of those institutions. The Financial Regulator also
has the power to initiate criminal action with respect to summary offences. The
initiation of serious crimes (on indictment) must be referred to the Director of Public
Prosecutions.
Yes

The FSA can accuse financial institutions. From Article 61 to Article 66 of the
Banking Law and from Article 315 to Article 338 of the Insurance Business Law,
penal provisions are stipulated.
Yes




Yes
Criminal actions are initiated by the Attorney-General's Chambers.
Right to investigate
Yes
There are threshold triggers APRA must meet.



                                       Yes




Yes
OSFI can undertake special examinations or investigations if deemed necessary.




Yes

Yes
BaFin has extensive investigation and information rights and the right to demand
submission of documents.




No.
See above.
Yes
The FME is authorised to perform search at the operating site and may confiscate
any material in accordance with provision of the Law of Criminal Procedure,
provided that there is strong reason to suspect that the party subject to
supervision has violated laws or regulations applicable to their operations, or if
there is reason to believe that inspections or measures by the FME will not
succeed otherwise. Provision of the Law of Criminal Procedure shall be applied
when executing such measures.




Yes




Yes

If only the investigation is for the purpose of the inspection. Article 25 of the
Banking Business Law and Article 129 of the Insurance Business Law stipulates
on-the-spot inspection.
Yes




Yes
[Internal note: There are no specific provisions in the MCRBA.]
Right/obligation to share information with regulators in other jurisdictions
Yes/No
Depends on nature of information in terms of APRA‟s secrecy provisions. APRA
also signs MOUs or other information sharing arrangements with Regulatory
Agencies in overseas jurisdictions.

                                      Yes
Such information exchange is based on EU-regulations within the European
Economic Area (EEA) and has also been implemented in various laws.
Furthermore, the FMA concluded/concludes Memoranda of Understanding (MoUs)
with foreign regulators.




Yes
OSFI can share supervisory information with foreign supervisors if it is satisfied that
the information will treated as confidential and be used only for supervisory
purposes.




Yes

Yes
Within the EU, the exchange of infomation is secured by the harmonised European
insurance/banking/securities supervisory legislation. In the relationship to third
countries, the exchange of information can be regulated on the basis of MoUs.




Y
Right to share information.
Yes
The FME may disclose to supervisory authorities in other member states of the
European Economic Area (EEA) information, which is to be treated confidentially in
accordance with our law, provided that this constitutes an act of co-operation
between those states involving supervision of the activities of parties subject to
supervision.      MoU can be concluded with supervisory authorities in countries
outside the EEA for trading information, under the condition that obligation to
observe secrecy in accordance with our law applies.         The FME has to take into
consideration the confidentiality requirements.




Yes




The Financial Regulator, as the competent authority appointed pursuant to various
legislation, is required to cooperate and share information with competent
authorities of other Member States in accordance with the requirements of EU law.
The Financial Regulator may disclose confidential information to any institution of
the EU or to the ECB for the purpose of complying with the Rome Treaty or the
ESCB Statute.        The Financial Regulator is also permitted to share information
pursuant to Memoranda of Understanding agreed with various other regulatory and
supervisory authorities including, for example, the US Commodities and Futures
Trading Commission.
Yes



Right only.
Yes




Yes
[Internal note: The right to share is not unfettered. There are also no specific
provisions in the Act providing for the power to share information, however,
disclosure is permitted under common law and if certain conditions are fulfilled.]
Right/obligation to share information with other domestic authorities or
government agencies (e.g. central bank, competition authority, prosecuting
authority, etc.)
Yes
Depends on nature of information and purpose for which information is to be used
in terms of APRA‟s secrecy provisions. APRA has MOUs on information sharing
arrangements in place with a number of other domestic agencies.

                                        Yes
Information is shared with certain agencies/authorities referred to in the Financial
Market Authority Act. These include courts, Ministry of Finance, Austrian Central
Bank, Austrian Takeover Commission, Stock Exchange). No information exchange
may take place with tax authorities.




Yes
OSFI has the right to share information with members of the Financial Institutions
Supervisory Authority (FISC) which is a statutory committee consisting of the OSFI
Superintendent, the Commissioner of the Financial Consumer Agency of Canada,
the Governor of the Bank of Canada, the Chairperson of the Canada Deposit
Insurance Corporation and the Deputy Minister of Finance. OSFI can be legally
compelled to disclose information to the Canadian courts. OSFI also has the right
to share information with any domestic agency or body that regulates or supervises
financial institutions if it is satisfied that the information will treated as confidential
and be used only for supervisory purposes.

Yes

Yes
BaFin is obliged to observe secrecy on information it becomes aware of when
performing its supervisory duties. The offices and authorities to which BaFin may
pass on confidential information are expressly regulated on a legal basis. The same
applies for the area of securities supervision.




Y
Partly obligation. Cases when information sharing is obligatory are set by the
sectoral acts. Other cases are managed by bilateral or multilateral MoU-s.
Yes/No
The FME has regular consultative meetings with representatives of the Central
Bank, where it provides information on the activities of the FME which are
necessary for the activities of the Central Bank of Iceland. The FME has to provide
the Central Bank with all the information in its possession which could be useful in
the Bank´s activities.     The FME has no rights or obligation to share information
with, e.g. competition authority.    The FME may not, subject to sanction based on
provision of the criminal code regarding civil servants, divulge to outside parties
information on the operation of the FME, the business and operation of parties
subject to supervision, related parties or others, which they acquire in their work
and which should be treated as confidential, except when a judge rules that they
should disclose such information in court or to the police.      Of course the FME
has to take into consideration the confidentiality requirements.




Yes
Subject to certain conditions, the Financial Regulator is required by law to report, as
appropriate, to various domestic authorities, including: the Garda Siochana
(police) the Revenue Commissioners, the Director of Corporate Enforcement,
the Competition Authority      any other body charged with the detection or
investigation of a criminal offence, or a contravention of law and the Competition
Act. The Financial Regulator may disclose confidential information to various
domestic authorities or persons as permitted in the Central Bank and Financial
Services Authority of Ireland Act 2003, including, for example,     the Irish Stock
Exchange a financial future and options exchange whose rules have been
approved by the Financial Regulator        an inspector or committee appointed under
various legislation an approved professional body for the purpose of monitoring
compliance by investment business firms or if necessary for the proper and orderly
regulation of such firms an auditor or to the supervisory body of auditors the
Pensions Board, the Investor Compensation Company Limited a liquidator,
examiner, receiver or other person or body involved in the liquidation or bankruptcy
Yes
Right only. It is stipulated in Paragraph 3 of Article 44 of the Bank of Japan Law
that the Bank of Japan may, at the request of the Commissioner of the FSA,
provide him/her with the findings and other information resulting from the Bank of
Japan's examinations or allow the FSA's staff to peruse them.
Yes
We share needed policy-related information with the Ministry of Finance and
Economy and the Bank of Korea.




Yes
[Internal note: Please note that the Acts are not so clear on this point Section 43
BA allows MAS to inspect books, accounts of a branch outside Singapore opened
by a bank incorporated in Singapore. The IA, SFA do not specifically state that
MAS may inspect overseas branches. However, there are provisions which permit
MAS to obtain information relation to the operations of a foreign branch (e.g.
section 33 IA, sections 20, 67 SFA on information gathering). Please also note that
any supervision would be subjected to the laws of the foreign countries.]
Supervise foreign/extraterritorial operations of the domestic institutions, as
well as activities conducted indirectly through subsidiaries and affiliates of
the institution.
No
We are currently seeking approval from the Government to obtain these powers.
However APRA supervises financial conglomerates including other offshore
operations reporting through Australian entities on a consolidated basis.

                                    Yes
These powers are based on implemented EU directives and EU-regulations.
Furthermore the FMA has concluded various MoUs with other regulators




Yes
As part of OSFI's consolidated supervision approach that is applied to deposit-
taking institutions and insurance companies.




Yes

Yes
On the basis of harmonised European legislation within the EU, there is the
authority to monitor branches of domestic companies in another EU state and also
publish supervisory measures in respect to foreign subsidiaries. Subsidiaries are
subject to the supervision of the respective host country both in the EU and in third
countries. In some cases there is authority for supervisory audits or participation in
audits on the basis of MoUs.



Y
Yes
The FME supervises foreign operation of domestic institutions on the EEA on
consolidated basis.       The FME would supervise the activities of domestic
institutions outside the EEA on a case-by-case basis.




Yes




The Financial Regulator has responsibility to supervise branches of Irish authorised
entities that are operating in other EU Member States.
Yes




Yes
We analyze and advise local subsidiaries and branches of foreign financial
institutions.




Yes
Legal protection against lawsuits for actions taken while the supervisor is
discharging its duties in good faith: -legal protection for supervisory agency,
legal protection for individual staff.
Yes
In respect of APRA staff, it must be demonstrated that the discharge of duties was
done in bad faith.


                                         Yes
The federal government is liable for damage caused by the FMA‟s bodies and
employees in the enforcement of the federal acts the FMA supervises. The FMA as
well as its employees and bodies are not liable towards the injured party. The
Federal Government is entitled to demand reimbursement from the FMA's bodies
or employees which is only due if the officer acted in gross negligence. The FMA
and its staff are insured.



Yes
OSFI and its employees are protected.




Yes

Yes
When damage occurs as a result of the infringement of official duties in respect to
the supervised companies BaFin is liable. BaFin employees are liable only for
intent or gross negligence. As BaFin operates only in public interest, BaFin is not
liable for third party damage resulting from supervisory measures which may not
have been taken on a timely basis or taken unlawfully (for example loss for
amounts due to a company).



Y
In agency level as well as in individual level. Any measures taken by the HFSA or
its staff members while they are discharging their duties in good faith can be suited
at the Court.
No




Yes




Yes


Article 1 of the State Redress Law stipulates primary legal protection for individual
staff.
No




Yes
Stipulate disclosure requirements
No




                                       No
The FMA may only stipulate how companies have to disclose ad hoc information
for companies listed on the Vienna Stock Exchange.




Yes




Yes

Yes
To that extent that disclosure requirements are affected in the context of proper
management, BaFin can instruct compliance of these obligation with supervision
measures. However, BaFin has no special authority to instruct that disclosure is
made. In the area of securities supervision, there are a range of legal disclosure
requirements, directed primarily at issuers (e.g. obligation to publish a prospectus/
information on voting rights, obligation to make a public takeover bid in an
acquisition). When the disclosure requirements are infringed, fines may be levied.
BaFin monitors adherence to these disclosure requirements.

Y
Yes
In the event of a serious infringement where the party subject to supervision has in
the opinion of the FME committed a criminal offence, the FME is obliged to notify
the State Police Commissioner.




Yes




Yes
Article 20 and Article 21 of the Banking Law stipulates publication of financial
statements and public disclosure of expositions relating to business and financial
conditions.    Article 111 of the Insurance Business Law stipulates public
disclosure of expositions relating to business and financial conditions.
Yes




Yes
Impose accounting requirements
No
AASB set the accounting requirements.



                                         Yes
The FMA may detail the accounting requirements which are to a large extend
already specified in the various supervisory acts.




Yes
The Superintendent has the authority to override or narrow the interpretation of
Generally Accepted Accounting Standards.




Yes

No
Within the framework of supervision, financial supervisory authority takes measures
to safeguard proper accounting.




No
Yes
According to relevant laws the board of directors and managing director of a
financial institution and insurance company/brokers must compile annual accounts
for each accounting year. The annual accounts must include a profit and loss
account, balance sheet, statement of cash flow and explanatory notes. A report
shall also be compiled by the board, which shall be an integral part of the annual
accounts. The accounting year for financial undertakings shall be the calendar
year. The annual account shall be signed by the board of directors and managing
directors of financial undertakings. The FME also issues rules on financial
statements for financial undertakings.        The FME shall ensure, in consultation
with the Icelandic Accounting Standards Board, that a definition as to what
comprises sound accounting practices for annual accounts of a pension fund is
available at all times.     The FME shall also issue Rules, in consultation with the
Icelandic Accounting Standards Board, on the structure of annual accounts, the
contents of individual items, the statement of changes in net assets for the payment
of pensions, the cash flow statement and explanations, and assessment of
Yes




Yes




Yes




Yes
Take control in the event of failure
Yes/No
In the Banking Act 1959 , APRA may appoint itself as a statutory manager of an
institution. This does not apply in other institutions.


                                          Yes
Under certain conditions the FMA may order measures before a failure occurs and is
involved in the insolvency (bankruptcy) proceedings regarding the institutions it
supervises.




Yes




Yes

No
In the case of insolvency BaFin has the authority to file for sinsolvency proceedings.
The company is then wound up by an insolvency administrator appointed by the court.




Y
The HFSA is empowered to assign supervisory commissioner.
No
The FME can not take control in the event of failure but it would intervene and make
necessary arrangement on a case-by-case basis such as appoint a specialist for
inspecting certain aspects of the operations or management of party subject to
supervision, or to undertake specific supervision of such a party. The FME can also
call a board or executive meeting of the party concerned to discuss its remarks and
demands, and discuss corrective action. Special legislation for each market also has
provisions regarding this matter.




Yes




Yes



The Deposit Insurance Law stipulates events of failure.
Yes
When financial institutions are unable to fulfill management guidance standards, we
may enforce Prompt Corrective Actions (PCAs) as necessary.




Yes
[Internal note: There are no provisions on MAS's power to take control in the IA (but
MAS may issue directions) and MCRBA. In the SFA, MAS has emergency powers
(section 34]
Others, please specify

While APRA would attempt to take control, it would all depend which industry and
our legislative powers.




Yes
e.g., Authority to enter into legally binding prudential agreements.




Yes
In the case of inadequate organisation of the company, considerable loss of capital
or unreliability or insufficient qualification of the management, BaFin can appoint a
sepcial officer who temporarily manages the company. The law contains further
disclosure requirements for issuers, adherence to which is monitored by BaFin. In
addition to the obligations named under item 1 p, there are obligations and
information duties relating to Ad hoc and Directors Dealing publications.
Yes / No




No



N/A
                       6. Is your authority headed by a board or an individual?
                          Board or individual           Title
                                Board              Executive Group
  Australia (APRA)


   Austria (FMA)                Board             Executive Board
  Belgium (CBFA)
                              Individual         Superintendent of
   Canada (OSFI)
                                                Financial Institutions
Denmark (Danish FSA)          Individual          Director General
  Germany (BaFin)             Individual             President
                                Board            Board of the HFSA




   Hungary (FSA)




   Iceland (FME)              Individual          General Director
                                Board            Board of Directors




   Ireland (IFSRA)




    Japan (FSA)               Individual           Commissioner
                          Board   Financial Supervisory
     Korea (FSS)                      Commission

  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
   Singapore (MAS)        Board    Board of Directors
United Kingdom (FSA)
rd or an individual?


          APRA is a body corporate and its governance structure comprises a full
          time Executive Group of at least three and no more than five members.
          One of the members is appointed as full time Chair of APRA.

          Our authority is headed by a two member Executive Board.




          The HFSA is headed by a Board. The Board is headed by the Chairman and
          may have five Members at maximum (together with the chairman). The
          Board is responsible for strategic governance of the HFSA. Exclusive duties
          of the Board which shall not be delegated to any other body or person:

          organisational framework, elaboration of the structure of the organisation

          requirements in the practice. The recommendations are legally non-binding.

          of examinations, approval of supervisory methodology.
          The office of the HFSA is headed by the Director General. Her job is
          supported by two Deputies. (The office of the HFSA is the whole HFSA
          except staff and responsibilities delegated to the Board.)

          The Financial Supervisory Authority is headed by an individual, a General Director. The Authority also has a board which is com

          The Board of Directors (Authority) is the ultimate decision making body of
          the Financial Regulator. Certain functions of the Authority are, however,
          delegated to the Chief Executive and Consumer Director, as follows :
          Chief Executive
          • bringing proceedings for offences under financial services legislation
          • management of the Financial Regulator
          • carrying out decisions of the Authority
          Consumer Director
          • manage the implementation of consumer protection legislation
          • monitor the provision of financial services to consumers having regard to
          the public interest
          • increase the awareness of consumers of costs, risk and benefits of
          financial services
          • monitor the extent of competition in the financial services market
As the head of the FSS, the FSS Governor has overall control of its
operations (§30, Establishment Act). The Financial Supervisory Commission
(FSC) can instruct and supervise the operations of the FSS, and the FSS
assists the FSC (§37-3, Establishment Act).




The Board of Directors is responsible for the policy and general administration of the affairs and business of MAS and informs t
also has a board which is composed of three members.
siness of MAS and informs the Government of the banking and credit policy of MAS. The MAS Board is ultimately accountable to the Parlia
s ultimately accountable to the Parliament of Singapore through the Minister-in-charge of MAS.
   Australia (APRA)




    Austria (FMA)




  Belgium (CBFA)
   Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)

   Hungary (FSA)

    Iceland (FME)
   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)


   Singapore (MAS)


United Kingdom (FSA)
7. What is the process of appointment of heads?

Under subsection 16(2) of the APRA Act 1998 (APRA Act), APRA members must be appointed by the Governor-
General by written instrument.

Under section 20 of the APRA Act, APRA members are appointed for a term specified in the instrument of
appointment, which cannot exceed 5 years.

Members can only be appointed if they are qualified; i.e. they must have knowledge or experience relevant to
The members of the Executive Board are appointed by the Federal President upon the proposal of the Federal
Government; re-appointment is admissible. Prior to the appointment of members of the Executive Board, the
Federal Minister of Finance issues a call for job tenders; the Ausschreibungsgesetz (AusG; Civil Service Job
Tender Act), shall be applied. Based on the results of the tender procedure, the following have to name persons
from the group of applicants for the proposal of the Federal Government.

For the appointment of the first Executive Board of the FMA, the Federal Minister of Finance and the
Oesterreichische Nationalbank (OeNB; Austria‟s central bank) named one person each;



The Superintendent is a Governor in Council appointment (i.e., Government appointment). The Superintendent is appointed fo
The Minister of Economic and Business Affairs appoints the Director General and the other members of the Executive Magena
The President and Vice President are appointed by the Federal President at a proposal of the Federal Government.
Chairman of the Board is nominated by the Prime Minister and appointed (or removed) by the Parliament.
Members of the Board are nominated by the Prime Minister in agreement with the Chairman of the Board and
appointed by the President of the Republic.
The Office of the HFSA is headed by the Director General. The Director General and her deputies are appointed
The Director General is appointed by the board. He is in charge of the day-to-day activities and operation of the Authority. The
The Authority comprises the Chairman, Chief Executive, Consumer Director and seven other non-executive members. The Ch
The Commissioner of the FSA is appointed by the Prime Minister.
The Chairman of the FSC concurrently holds the position of Governor of the FSS (§29-2, Establishment Act). The President ap




Under the MAS Act, the Board of Directors of MAS is appointed by the President.
The Chairman of the MAS Board is appointed by the President on the recommendation of the Cabinet.
The Managing Director is appointed by the President, on the recommendation of the Singapore Public Service
Commission (PSC). The PSC, an organ of state, serves as an independent and neutral body to safeguard
integrity, impartiality and meritocracy in the civil service. One of its key functions is to appoint and promote
rintendent is appointed for a seven-year term. The Superintendent appoints the Assistant Superintendents.
 of the Executive Magenagement.
 Government.




tion of the Authority. The board decides the terms of employment for the Director General.
cutive members. The Chairman and non-executive directors are appointed by the Minister for Finance after consultation with the Minister fo

nt Act). The President appoints the Chairman with the approval of the State Council (§4-2, Establishment Act).
after consultation with the Minister for Enterprise, Trade and Employment. The positions of Chief Executive and Consumer Director are ap
utive and Consumer Director are appointed by the Authority after a public open competition. Both of these positions are also approved by th
ese positions are also approved by the Minister for Finance.
  Australia (APRA)




   Austria (FMA)




  Belgium (CBFA)
   Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)




   Hungary (FSA)




   Iceland (FME)
   Ireland (IFSRA)




     Japan (FSA)




     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
8. Please, describe terms of office of the heads. What are the reasons and conditions
that allow for their removal?

Section 25 of the APRA Act governs the removal of APRA members during their term of office and specifies the
reasons for termination. A member‟s appointment will be terminated immediately if the member becomes a
director, officer or employee of a body regulated by APRA.

Section 26 of the APRA Act provides for termination of the member in other circumstances:
• for misbehaviour or physical or mental incapacity;
• for bankruptcy or assignment of remuneration for the benefit of creditors;
• if absent from duty, except approved leave of absence, for 14 consecutive days or 28 days in any 12 month
period;
• if engaged, except with approval, in paid employment outside the function of the office;
• if becomes a director, officer or employee of a body operating in the financial sector and Minister considers that
The term of office is three years in the case of a first-time appointment of a person as member of the Executive
Board; however, in the case of a re-appointment it is five years.

The Federal Minister of Finance shall dismiss a member of the Executive Board if a substantial reason exists,
such as in particular:
1. an appointment condition is no longer fulfilled;
2. it subsequently emerges that an appointment condition had not been fulfilled, or
3. gross breach of duty, or
4. permanent incapacity to work or if the member concerned is absent from work for a period of more than half a
year due to illness, accident or an infirmity, or
5. if breaches of duty have not or have not lastingly been eliminated despite supervisory measures taken
pursuant to section 11 para 2 of the Financial Market Authority Act1 (FMABG).

The Superintendent holds office during good behaviour and may only be removed for cause by the Governor in Council. The or
It depends of the tenure. Some are appointed for a specific number of years some till they go on pension or leave for another jo
The appointments of the President and Vice President are for an unlimited term. Once appointed the heads and members of th
The term of office is six years in each case. Reasons and conditions of removal are strictly regulated in the Act
CXXIV of 1999 on the HFSA. Term of office of the Chairman or any Member of the Board of the HFSA is ceased
in the following cases:


Parliament (Chairman) resp. to the Prime Minister (Members of the Board)..


Chairman of the Board or any Member of the Board can be removed by the Parliament (Chairman) or by the
President of the Republic (Members) only if:




The Director General and her two Deputies are appointed for six years as well. Reasons for removal:


The Board decides the terms of employment for the Director General. The Director General shall be of legal age
and must never have been deprived of control over his own financial affairs. He shall have an unblemished
reputation and shall not have been sentenced in connection with business operation for infringement of the penal
code or of the laws on public limited companies, private limited companies, accounting, annual accounts,
As indicated above the Minister for Finance appoints the Chairperson and members of the Authority, after
consulting the Minister for Enterprise Trade and Employment. Their term of appointment is for 5 years. In
addition, there is a statutory position of Registrar of Credit Unions. He is also appointed for a period of 5 years,
but is not a member of the Authority.

A person ceases to be a member of the Authority, Chief Executive, Consumer Director and / or Registrar of
Credit Unions if the person:
1. Dies
2. Completes a term of office and is not re-appointed
3. Resigns by notice of writing
4. In the case of a non-executive director who has, without permission, been absent for a consecutive period of 6
months from meetings
5. is terms of office a candidate in local,defined. The Commissioner may not elections,
The nominated as are not particularly national or European Parliamentary be dismissed against his will except
for legally defined reasons.
Tenure of the FSS Governor: 3 years (§6-1, Establishment Act)
Reasons for Removal (§8, §10, Establishment Act)
i. A person who is not a Korean national;
ii. An incompetent or a quasi-incompetent;
iii. A bankrupt person who has not been reinstated;
iv. A person who was sentenced to a suspension of execution of an imprisonment without prison labor or a
heavier penalty and who is still in the period of suspension;
v. A person who was sentenced to an imprisonment without prison labor or a heavier penalty and for whom five
years have not elapsed since the completion of the execution (including the case where the execution was
deemed to be completed) or the remission thereof;
vi. A person who was sentenced to a fine under this Act or other finance-related Acts and subordinate statutes
(including foreign finance-related Acts and subordinate statutes) and for whom five years have not elapsed since




All board appointments are for a limited term. Generally, the terms are between 2 – 3 years.
[Internal note: This is not in the MAS Act but is something we practice]
The President may terminate the appointment of any director if the director:
• resigns his office;
• becomes of unsound mind or incapable of carrying out his duties;
• becomes bankrupt or suspends payment to or compounds with his creditors;
• is convicted of an offence involving dishonesty or fraud or moral turpitude;
• is guilty of serious misconduct in relation to his duties;
• is absent, without leave, from 3 consecutive meetings of the board; or fails to comply with his obligations
overnor in Council. The order removing the Superintendent and the documents relating thereto must be tabled with Parliament in the event th
 ion or leave for another job. If they do not perform, they might be fired.
heads and members of the governing body of the BaFin stay in office until he/she retires on a pension. For the removal of the President and
tabled with Parliament in the event the Superintendent is removed from office prior to the expiration of his term. This differs from many other

For the removal of the President and other leading personnel the same rules as for other civil servants apply. The rules are laid down in law (
s term. This differs from many other GIC appointments where the individual is appointed to serve “at the pleasure of the crown”. The Super

pply. The rules are laid down in law (Civil Service Act – Bundesbeamtengesetz – BBG; sections 21 et seq. Beamtenrechtsrahmengesetz – B
e pleasure of the crown”. The Superintendent can remove an Assistant Superintendent at his/her discretion.

q. Beamtenrechtsrahmengesetz – BRRG and Bundesdisziplinarordnung – BDO). A civil servant who is convicted of a criminal offence and s
convicted of a criminal offence and sentenced to prison for at least six months or one year, respectively, or who forfeits a basic right shall be
, or who forfeits a basic right shall be dismissed from office (see section 24 (1) BRRG). There is no obligation to disclose the reason for remo
gation to disclose the reason for removing the President of the BaFin publicly. However, pressure from the public would require this informatio
he public would require this information to be disclosed.
  Australia (APRA)




   Austria (FMA)




  Belgium (CBFA)
   Canada (OSFI)




Denmark (Danish FSA)




  Germany (BaFin)
Hungary (FSA)




Iceland (FME)




Ireland (IFSRA)




 Japan (FSA)
     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
9. What is the decision making process regarding major activities of your authority?
For example: what is the process for supervisory actions (i.e: sanctions, etc) for
binding and non binding general actions, internal issues such as budget /
expenditures, etc.
The Executive Group meets on a monthly basis, and more frequently as required, to discuss and resolve the
major prudential policy, supervisory and strategic issues facing APRA at the time. It also holds management
group meetings with APRA's senior management at least weekly for high-level information sharing and decisions
on more routine supervisory and organisational matters.

APRA has also established an Enforcement Committee to set priorities and allocate resources to all enforcement
cases. The Committee, whose membership includes all the frontline Executive General Managers and the
Deputy Chair of APRA as chairman, has the power to meet quickly and decide on corrective or enforcement
actions needed to be taken to remedy a problem situation or to limit losses (or further losses) to depositors,
policyholders or fund members.

Supervisory Actions
The executive directors have to be informed and confirm or approve all major decisions concerning for example
licenses (or their revocation), reports on on-site inspections and their annual planning, sensitive supervisory
actions, regulations and positions of the FMA in legislative proceedings

Administrative Penal Proceedings
The competent supervisory department transfers any suspicion of an administrative infringement to the
department “legal and enforcement affairs” (which is integrated in a separate division “integrated supervision”).
The legal department decides whether administrative penal proceedings are to be initiated. The legal department
carries out the proceedings. If they end with an administrative penal decision imposing penal fines these
decisions have to be confirmed by the executive directors of the FMA.
Financial Planning:
Pursuant to the Austrian Financial Market Act, section 17, in conjunction with section 19 para 8, the Executive
Board of the FMA has to prepare a financial plan for the following financial year including an investment and staff
plan, which has to be submitted to the Supervisory Board by October 31 of the current year at the latest. The
Supervisory Board, in turn, has to approve the financial plan as soon as possible but no later than by December
15 of the current financial year. The financial plan shall include all FMA related expected revenues and expenses
to be paid in the following financial year, listed separately and in the full amount (gross). The budgeted amounts
shall be calculated; if this is not possible, they shall be estimated.

All major decisions involve the OSFI Executive. Internal issues such as budgeting, key expenditures, collective bargaining, legi
The Danish Parliament grants Finanstilsynet (The Danish Financial Supervisory Authority) an appropriation.
Allocation of the appropriation is carried out by Finanstilsynet, but the level of cost is approved by the Ministry of
Finance through the Ministry of Economic and Business Affairs according to the regular government budget
approving procedure, which sets the limits to Finanstilsynets total resources.

The appropriation is split in a total sum of wages and total sum of running expenses. At the beginning of the
internal budgeting procedure the senior management outline the budgetary framework for each division (wages)
and for running expenses. Each director of division draw up a budgetary proposal regarding wage within the
budgetary framework, and the wage budget is approved on annual meetings between the senior management
and each division leadership. Likewise, the persons with budgetary responsibility draw up a budgetary proposal
regarding running expenses, which is approved by the senior management.
The „Internal Rules of Procedure“ of BaFin include the responsibilities and the decision making process. The
president as head of BaFin is in charge of all activities of BaFin. He can delegate tasks to his deputy or to other
members of the management. As regards signing the documents, it depends on the importance of the
letter/document or addressee who has to sign. The most important documents have to be signed by the
Supervisory actions:
Normally they are prepared by the office of the HFSA and issued by the Director General or one of her Deputies.
Important and/or high-impact actions are discussed by the Board as well.
Licensing:
Office of the HFSA and issued by the Director General or one of her Deputies
Supervisory methodology, legally binding publications:
Prepared for decision-making by the office of the HFSA and discussed by the Board. Final decision is made by
the Board in relation with its role on control over professional performance of the HFSA.
Continuous supervision:
Sole responsibility of the Office.
Internal issues:
Budget of the HFSA is approved by the Board of the HFSA.
Internal rules of operation and responsibilities of different organisational units are prepared by the Board and
approved by the Minister of Finance.
HR management of the Office is responsibility of the Director General.

The Board decides on major issues, e.g. decisions on daily penalties and administrative fines, decisions to
request specific inspection and the seizing of documents in accordance with legislation on the handling of official
cases, decision to propose the revocation of the operating licence of a party subject to supervision.
The FME submits a report to the Minister of Commerce on the estimated operational cost for the coming year.
The FME´s report shall be accompanied by an opinion from the consultative committee of parties subject to
supervision concerning their estimated scope of operations for the coming year together with the reaction of the
Board of the FME to this opinion. If the conclusion of the report gives reason to change the percentage rate of
the supervision fee, the Minister of Commerce shall submit a bill thereupon to the Althingi (Parliament).

The Financial Regulator is obliged by statute to consult with both a statutory industry panel and a statutory
consumer panel before issuing any policy document or regulatory document (such as a code of conduct or other
generally applicable rules), except in urgent cases (where consultation may take place afterwards). These panels
also provide comments on (amongst other things) the draft estimate of income and expenditure of the Financial
Regulator.
In addition, the Financial Regulator is required to consult with the Minister for Finance before issuing certain
codes of conduct. Statute provides for the Authority to issue directions and guidelines with which the Chief
Executive, the Consumer Director and/or the Registrar of Credit Unions (as applicable) must comply in the
performance of their functions on behalf of the Authority. The Consumer Director is also required by statute to
obtain the approval of the other members of the Authority before issuing codes or imposing requirements on the
     The FSA is authorized to take administrative actions such as the revocation of license, registration and
approval, the business suspension order, and the business improvement order, etc by business laws and related
regulations. Under requirements stipulated in the laws, the FSA makes judgement whether it needs to take
administrative actions or not.
After taking the business improvement order, etc, the FSA checks financial institutions‟ status of implementation
through their reports about conditions of improvement and inspections. In addition, if there are problems in status
of implementation, the FSA takes a further administrative action when the FSA thinks it is necessary.
urther administrative action when the FSA thinks it is necessary.
Note) In the case of administrative protest, though it depends on the situation, the FSA require financial
institutions‟ implementing measures as ordered when the FSA thinks it is necessary.
In principle, the FSC deliberates and makes decisions on all supervision-related measures (regardless of whether
it is legally binding) as well as structural changes and budget of the FSS (§17, §18, Establishment Act).
However, amendments to regulations on accounting at securities and futures companies as well as authorization
of securities and futures companies are deliberated by the Securities and Futures Commission (SFC), after which
the FSC makes a decision.
Moreover, for measures relating to results of investigation into unfair trading practices, deliberation results of
disclosure violation, and results of an audit review and its consequences, the SFC delivers and makes decision at
the same time (If the amount involved exceeds a certain level, the FSC makes decisions).
Matters consigned by the FSC may be decided by the Governor of the FSS.




Important policy and supervisory matters requiring review, debate, and/or decisions are raised and discussed at the weekly Fin
collective bargaining, legislation, etc. would involve internal and in some cases relevant external resources such as Treasury Board, Unions,
cussed at the weekly Financial Supervision Group (FSG) Heads Meeting. These may include (i) decisions on operational, regulatory or supe
ces such as Treasury Board, Unions, Parliament.
ns on operational, regulatory or supervisory issues that have been delegated by the Managing Director; (ii) policy discussions that require FS
(ii) policy discussions that require FSG Heads‟ inputs and decisions at the developmental stage, including proposed amendments and/or add
ng proposed amendments and/or additions to existing regulations; and (iii) discussions on papers and issues originating from the FSG Depar
sues originating from the FSG Departments and would require decisions at senior management or board-level meeting.
d-level meeting.
   Australia (APRA)




    Austria (FMA)




   Belgium (CBFA)
     Canada (OSFI)
Denmark (Danish FSA)
   Germany (BaFin)
    Hungary (FSA)
     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
10. How is your authority funded?

APRA is funded primarily from levies collected from supervised financial institutions. Other funding sources
include: interest on funds invested, fees for services and miscellaneous cost offsets.
The power to collect levies is given to APRA by the Financial Institutions Supervisory Levies Collection Act 1998
and the Levy Imposition Acts for each industry sectors (refer Part II, Question 1). Preceding each new financial
year, the Minister announces the levy determinations that will apply for each industry sector, and a flat rate to
apply to non operating holding companies. The process for determining levies includes detailed consultation with
Treasury and the main industry groups.
For each financial year up to and including 2004-05, the levy for each industry sector has only had one
component. This levy was a percentage of an institution‟s assets, subject to a minimium and maximium charge.

The FMA – responsible for the supervision of credit institutions, insurance undertakings, pension funds, staff
provision funds, investment funds, investment services providers, companies listed on the stock exchange as
well as stock exchanges themselves – is funded by the above mentioned “entities liable to pay costs” and by
variable fees from supervised companies according to the Austrian Financial Market Authority Act.

The federal government contributes a fixed sum of EUR 3.5 million to the FMA each financial year (Section 19,
para 4). This amount as well as income which does not flow to the FMA as compensation for supervision costs or
related advance payments or pursuant to para 10 shall be deducted from the total costs of the FMA. The
remaining difference shall be apportioned among the accounting groups 1 to 4 using the rations relating to the
direct costs of each group. The amounts resulting there from for each accounting group, and after deducting the
authorisation fees received pursuant to para 10, shall represent those costs to be reimbursed by natural or legal
persons in accordance with the provisions of the Austrian Banking Act, the Insurance Supervision Act, the
Securities Supervision Act and the Pensionskassen Act when the FMA issues a notice of payment due.

Austrian Financial Market Authority Act, Section 19, para 1:
The FMA shall form a separate accounting group for each of the supervisory areas listed in section 2 paras 1 to
4. With regard to its internal organisation it shall make provisions for the most far-reaching direct allocation of the
supervision costs (personnel and material expenses, write-offs and other expenses) to these accounting groups.
Those costs that cannot be allocated directly to a specific accounting group shall be apportioned among the
individual accounting groups pursuant to para 2.



The financial institutions supervised by OSFI pay the costs of operating OSFI. This includes Banks, Trust companies, Loan co
The Parliament grants Finanstilsynet an appropriation at the beginning of the year and the Authority collects the appropriation p
Although BaFin is a public authority, it is financed exclusively from its own income. This income is generated through fees, sepa
The HFSA is fully funded from the market by supervisory fees and administrative fees paid by the supervised institutions.
The parties subjected to supervision pay the cost of operating the FME.
By agreement with the Minister for Finance in April 2004, over the three year period 2004 – 2006 approximately 50% of the tota
The budget of the FSA is a funded by the national budget.
Funding for the FSS comes from supervised financial institutions such as fees collected from securities issuances as well as fr




Pending FD‟s inputs
 rust companies, Loan companies, Life insurance companies and Fraternals, Property & Casualty Insurance companies, Co-operative Credit
ollects the appropriation plus interests from the various financial companies under supervision at the end of the year as described by the Fina
 erated through fees, separate reimbursements (e.g. for special local audits at companies under supervision) and predominantly through ann
ervised institutions.

oximately 50% of the total costs of the Financial Regulator are met by the imposition of levies on the industry. The balance of the total annu

es issuances as well as from the Bank of Korea.
ance companies, Co-operative Credit Societies, and federally regulated private pension plans. A very small (less than 1%) portion of OSFI‟s
d of the year as described by the Financial Business Act.
 sion) and predominantly through annual cost allocation levies. The fees and the separate reimbursements are, however, by no means suffici



ustry. The balance of the total annual costs is provided by the Board of the CBFSAI and therefore, indirectly, by the Exchequer.
mall (less than 1%) portion of OSFI‟s funding is through a parliamentary appropriation from the federal government that relates to non-financi

nts are, however, by no means sufficient to cover BaFin‟s costs. Almost 90% of costs are recovered by means of annual cost allocation levy a



rectly, by the Exchequer.
overnment that relates to non-financial institution work. Please refer to the Assessment of Financial Institutions Regulations - http://laws.just

means of annual cost allocation levy among all subjects under supervision. The cost allocation levy is calculated in the year after the costs for
itutions Regulations - http://laws.justice.gc.ca/en/o-2.7/sor-2001-177/155117.html

culated in the year after the costs for the previous year have been definitively determined. Liquidity is no problem for BaFin, as financial insti
o problem for BaFin, as financial institutions have to make an advance payment in December of the actual business year for the following bus
al business year for the following business year according to their part of the new budget plan. BaFin develops its own budget plan. The adm
velops its own budget plan. The administrative council which supervises the executive level of BaFin and supports management in an adviso
d supports management in an advisory capacity has then to decide on this budget plan. At the
  Australia (APRA)
    Austria (FMA)
   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)
   Hungary (FSA)
    Iceland (FME)
   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
  Singapore (MAS)
United Kingdom (FSA)
11. What was the volume (in USD) and structure of your budget in the last financial year? (Please, indi




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financial year? (Please, indicate beginning and end of the financial year.)
  Australia (APRA)




   Austria (FMA)


  Belgium (CBFA)




   Canada (OSFI)




Denmark (Danish FSA)



  Germany (BaFin)
Hungary (FSA)



Iceland (FME)




Ireland (IFSRA)




 Japan (FSA)
     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)



   Singapore (MAS)



United Kingdom (FSA)
12. Please describe the accountability mechanisms relevant for your authority. (Is your authority o

Internal oversight of APRA is monitored by the Risk Management and Audit Committee. The Committee
comprises an external chair (with casting vote), one external member, one member of APRA‟s Executive Group
and an Executive General Manager (on a one-year rotation). Regular attendees at committee meetings are the
General Manager – Risk Assessment and Internal Audit, the Chief Financial Officer and a representative of the
Australian National Audit Office. The Chairman of APRA may attend by invitation.

Section 9 of the CAC Act requires APRA to prepare an annual report for the Minister on its operational and
financial performance. APRA‟s annual reports are tabled in Parliament and made public.

APRA is subject to financial and performance audits by the Australian National Audit Office (ANAO), the latest
being conducted in 2004. The reports of the ANAO are tabled in Federal Parliament and are publicly available.

APRA is also subject to review before Parliamentary Standing Committees, such as the House of
Representatives Committee on Economics, Finance and Public Administration. Its performance is also subject to
review by the Senate Estimates Hearings and Senate Select Committees. Transcripts of the proceedings of all of
these committees are publicly available.

Other accountability mechanisms include:
• legislative and policy requirements on staff to act professionally, honestly, free from bias, and in good faith;
• internal governance arrangements, including delegations for decision-making and the discipline provided by the
APRA Enforcement Committee;
The FMA has to submit a report on the past calendar year to the Finance Committee of the National Assembly
and the Federal Minister of Finance within four months after the end of each calendar year. This report shall
particularly include an overview of the supervisory activities and the status of the public finances. The Finance
Committee is entitled to summon the Executive Board of the FMA to committee meetings and gather information
from it, unless this conflicts with statutory secrecy obligations. (Section 16 of the Financial Market Authority Act).

The Minister of Finance – The Minister of Finance is legally responsible for OSFI, and all annual reports to
Parliament from the Superintendent are tabled through the Minister. This means that legally, the Minister is
responsible for the operations of OSFI (e.g. contracting), except in those areas specifically assigned through
legislative provisions to the Superintendent (e.g. personnel management). In practice, however, the Minister has
delegated his operational responsibilities to the Superintendent to exercise on a daily basis. The Superintendent
is required to report to the Minister from time to time on all matters connected with his/her duties under the Office
of Superintendent of Financial Institutions Act .
Parliament – Although the Minister of Finance is responsible for OSFI, the Superintendent is specifically
Finanstilsynet shall responsibilities contained in the financial legislation and may be called to appear before
accountable for his submit an annual report on its activities to the Minister for Economic and Business Affairs, cf.
The Financial Business Act, section 353.
Ministry of Finance: BaFin is subject to legal and supervisory control of MoF. BaFin reports directly to MoF
(reporting obligation).
Courts/Judiciary: Any decisions taken by BaFin can be subject to juridical review. This is a control mechanism
which ensures that BaFin acts within the limits of the law.
Consumers: responsibility for consumer protection, especially in insurance supervision (i.e. complaints handling);
Supervisory Board (Administrative Council): monitors the management of BaFin and supports it in the execution
of its duties; two meeting per year; decides on/approves the budget ; President is obliged to inform the Council of
The HFSA is obliged to report to the Minister of Finance on a half-yearly basis regarding main experiences of
supervisory activities, market developments and entitled to make recommendations on changes in the legal
framework.
On a yearly basis the HFSA is obliged to report to the Parliament via the Government and it is obliged to publish
its Annual Report.
Beyond daily works, Director General of the office of the HFSA reports to the Board of the HFSA on a yearly basis
The FME reports directly to
Parliamentary Committees the Minister of Commerce.
The Chairperson of the Board, Chief Executive, Consumer Director and Registrar of Credit Unions are required,
when requested, to attend proceedings of Parlimentary Committees responsible for examining relevant
supervisory issues. In most cases, this is the Finance and Public Service Committee. The normal procedure is for
the relevant official to make an opening statement on the supervisory matter under discussion and answer
questions the Committee may have.

Reporting to the Minister for Finance
The Annual Report fulfils the obligations of the Financial Regulator to provide an Annual Report to the Minister for
Finance on the performance of its functions and the exercise of its powers. Senior executives and management
also have meetings with the Minister and his officials to keep them informed of developments, relevant to their
statutory functions.

Minister for Finance
The Minister for Finance appoints the members of Board of the Financial Regulator. The Minister approves the
budget and the amount of the funding levy to be raised from industry and the form of our annual Strategic Plan.

Courts
Decisions of the Financial Regulator may be subject to judicial review by the High Court, under general principles
of Irish administrative law.

Public / Consumers / Institutions supervised
We have developed a programme of regional visits around the country to promote our consumer protection role.
Our primary means of accountability to the institutions we supervise, to consumers and to the public generally is
through the publication of our Strategic Plan and Annual Report. Our Strategic Plan outlines commitments to
specified actions and the associated target dates to achieve them. Our Annual Report, in turn, reports publicly on
whether or not stated strategic actions have been met.

Supervisory Board
As noted in the answer to question 1, the Financial Regulator is primarily accountable to an autonomous board.
This board is the ultimate decision making body and consists of an independent chairman, two executive
directors (Chief Executive and Consumer Director) and seven non-executive directors. The Prudential Director
attends all meetings of the board.
Parliament
Based on the constitution, the FSA must answer the questions from the Diet or its member.
Institutions supervised
Based on the decision at Cabinet Meeting, The FSA has implemented the No Action Letter System. Through this
process, the FSA receives inquiries in advance about whether new businesses by corporations, etc are against
the law. The FSA in principal gives the responses within 30 days and discloses the responses on the website.
When the FSA takes administrative actions such as the revocation of license, registration and approval, the
business suspension order, and the business improvement order, etc, the FSA must explain the reason to the
institutions.

Consumers and public
The annual report and policy evaluation program are issued and posted on the website by the FSA. It
The FSS bears responsibility in front of the National Assembly, which represents the public.
- It is obliged to report its activities to the Political Affairs Committee of the National Assembly, and to provide
requested information.
- Also, the National Assembly may monitor and supervise FSS‟s activities through the national audit and
investigation.

In principle, the supervisory authority is not mandated to report its activities to the government.
- However, if the government (the MOFE) requests information, it must oblige as long as there are no special
reasons against it;




Under Singapore‟s Constitution, MAS via the MAS board is accountable to the Minister-in-charge of MAS who is
in turn accountable to Parliament for MAS‟ performance.
The Minister answers parliamentary questions relating to MAS (e.g. the conduct of monetary policy) and explains
MAS‟ policies in Parliament when tabling MAS-related Bills.
The MAS Act sets out the following accountability framework:
• Presentation of the audited financial statements and annual report by the Board on MAS‟ operations (within six
. (Is your authority obliged to report to the Government and/or to the Parliament or to other bodies, what is th
or to other bodies, what is the frequency, etc.)
  Australia (APRA)




   Austria (FMA)




  Belgium (CBFA)




   Canada (OSFI)




Denmark (Danish FSA)




  Germany (BaFin)
Hungary (FSA)




Iceland (FME)




Ireland (IFSRA)




 Japan (FSA)
     Korea (FSS)




 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
13. How can you describe your authority’s staffing policy? Please, explain the major challenges in rec

APRA‟s business strategy requires us to attract, develop, manage, and retain a highly skilled and motivated
workforce. In order to maintain and enhance the quality of staff we need to focus on:
• emphasising the social value attaching to APRA‟s work. We are an essential element in a sound and trustworthy
financial system, which is one of the conditions for a successful modern society;
• increasing staff engagement levels so that APRA employees stay longer, strive to increase their contribution levels
and have a positive outlook about working in APRA;
• ensuring that our workplace operates as efficiently, fairly and flexibly as reasonably possible. Examples include
work–family balance, extensive development, access to varied career and advancement opportunities and positive,
high respect internal behaviour; and
• improving our managerial capabilities, such that the great majority of APRA team leaders are competent in their
leadership roles. This will require additional development for some staff, including greater accountability for the
leadership components of their roles.
Human Resources Strategic Objective
Enhance our organisational effectiveness by continuing to ensure we recruit the right people for the job, retain our
skills and knowledge, develop our people so they can achieve professionally and personally and deploy our people


Regarding our staffing policy we try to find a balance between experienced staff and a smaller number of graduates.
Challenges in recruitment are primarily due to higher salaries in the financial industry in certain specialist positions.
Challenges in training result from the limited amount of time employees can contribute to their training for not
neglecting their operational duties.
Finding relevant topics or trainers is less of a problem.


Canada (OSFI)
It is OSFI‟s policy to conduct staffing activities that support OSFI‟s strategies, business plans and operational needs
and that respects the staffing values of fairness, transparency and access. In so doing we will:
• Staff positions using both indeterminate and determinate (term) basis
• Ensure that opportunities are available to all employees
• Respect OSFI‟s guiding principles for Human Resource management;
• Comply with appropriate policies and legislation
OSFI will advertise all job vacancies, with a minimum of exceptions.

Within its budget the Financial Supervisory Authority endeavors to recruit a sufficient and qualified staff to perform its
supervisory task. The Financial Supervisory Authority tries to offer competitive salaries, but it is not possible due to
the limited budget. The staff is continuously being upgraded as they all participate in continuing education such as
seminars and courses.
New staff is selected by an application process including an interview and an assessment centre. Experienced
applicants as well as beginners are selected by the same way. Above average exam results and relevant
professional experience are required. BaFin employees mostly become the status of a civil servant. The age limit to
become a civil servant is 40 years in the moment of employment, but in general there is no age limit to get employed
by BaFin.
The Department for Human Resources supervises the complete selection process. In order to guarantee an
appropriate level of expert knowledge, members of the different supervising units support the selection process and
take part in the interviews and assessment centres.
The amount of salary that is allowed to be paid according to the German law of public service is sometimes a
problem as the applicants often get better offerings by the economy.
Concerning framework for staffing policy, see the Strategy of the HFSA at question II.4. Our HR policy is under
preparation.
Recruitment shall be done by public tenders in case of heads of departments and higher than that positions. Tender
can be avoided if there is an appropriate applicant who has at least 1 year employment with the HFSA. Lower
positions shall not be tendered, however, they typically are tendered in the practice.
One of the major challenges is to find staff with strong ability to react, high professional skills and knowledge in
languages within the framework of legally limited income facilities. Another very important challenge is how to train
the staff.


The FME endeavours to exert positive influence on the development of the market and contribute towards stable
financial services. That requires clear strategy, efficient internal processes, qualified staff and exemplary information
systems. It is FME´s human resource aim to be known for professionalism, reliability and results. Enjoy respect and
trust and be interesting and desirable work place. Robust changes in the Icelandic financial market has been the
major challenge in competing with the financial market in recruitment of the staff. Increased globalisation of the
financial companies and changes in technology are the major challenge in the training of the staff.

Recruitment
In addition to internal promotion procedures, we also recruit staff through placing adverts in the national press, on our
websites and occasionally through other means such as direct mail shots to members of professional bodies (for
specialist positions). From time to time we use a recruitment agency but generally this is only for temporary positions.

Training
We offer training to staff, in terms of both soft skills training and technical training. We are currently scoping out how
we should develop our approach to technical training and are pursuing an option of developing a curriculum-based
approach to training our regulatory staff. It is envisaged that such training would include developing a curriculum
under a number of headings such as: authorisation, inspections, enforcement, education/communication and
administration.

The FSA has two recruiting channels as follows.
          a). Recruitment of successful candidates of examinations for government officials conducted by the
National Personnel Authority.
          b). Open recruitment of experts without examination by NPA.

xi. The FSA employs personnel who have a certain level of abilities through examinations. Besides, the FSA hires
experts from various fields such as law, economics, science and technology and others.

b) In the open recruitment, the FSA employs financial technology experts who have sophisticated expertise through
their business experiences on finance, lawyers, CPAs and actuaries.
[Optimal Staffing]
New staff members accumulate diverse experiences by rotating through various departments. After a set period, staff
are encouraged to specialize in a particular sector or function that matches their intent, experience, and skills.

[Relevant Industry Experience]
We are facing rapid changes in the financial environment due to financial globalization and growth. Despite
continuous efforts by the FSS, we are limited in our ability to preemptively respond to the transitions. Therefore, we
need to actively accept external specialists with relevant industry experience to upgrade our skills and understanding
of the market.

[Demand for Staff with Industry Experience]
We have increasing demand for experienced staff, especially from fields which experience rapid changes, such as
Basel II and derivatives, and from sectors with insufficient internal specialists.

[Recruitment, Employment, and Maintenance of Excellent Staff]
i. We plan to recruit more outside professionals by providing more opportunities for them to join.
ii. Systematic training programs will strengthen proficiency of staff. The program will include risk-based supervision
and exchange programs with advanced supervisory authorities.




MAS places emphasis on hiring fresh graduates as a basis for building up our own pool of future leaders. We also
focus on hiring mid-careers with specialised skills.
A challenge faced in terms of recruitment is the availability of sufficient and relevant expertise in the small local
market. Hence there is a need to constantly explore and use different approaches and channels in our recruitment
efforts.
For functional training, some of the challenges include the fostering of an attitude of continuous learning amongst
staff, and the promotion of supervisory-experience sharing and cross-fertilisation of ideas. To better manage the
depth and breadth of supervisory and technical expertise within supervisory departments, MAS is working to
establish a Faculty of Peers to harness existing supervisory and product expertise. The Faculty aims to develop a
group of staff with sufficient depth and exposure in specific areas that can provide advice or consultation to staff. It
would serve as a "heat map" to identify the expertise areas where MAS is below its desired resource strength, and
allow MAS to increase the pipe-line of experts in those areas as well as plan for more training in those topics. Such
a structure would also provide development opportunities for staff inclined to pursue specialized areas of supervisory
the major challenges in recruitment and training of the staff.
  Australia (APRA)




   Austria (FMA)
  Belgium (CBFA)



   Canada (OSFI)



Denmark (Danish FSA)
   Germany (BaFin)




   Hungary (FSA)



    Iceland (FME)




   Ireland (IFSRA)




    Japan (FSA)
    Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)
  Singapore (MAS)




United Kingdom (FSA)
14. Number of full-time staff equivalent and breakdown by complexity of risks run by the
institutions:
a. Staff for supervision of financial groups (diversified activities / “large and complex”)
b. Medium-risk institutions with moderate risks which can be isolated (turbulences in the
system, but no systemic risk)
c. Small market-specialists with negligible impact on operation of the financial sector

a) Staff for supervision of financial groups: Diversified activities / “large and complex”)
b) Medium-risk institutions with moderate risks which can be isolated (turbulences in the system, but no systemic
risk)
c) Small market-specialists with negligible impact on operation of the financial sector
Staffing as at 31 March 2006
Division Total
Diversified Institutions 113.20
Specialised Institutions 159.86
Supervisory Support 130.38
Policy Research & Stats 80.00
Corporate Services 125.21
Grand Total 608.65

Specialised Institutions Division (SID)
SID is responsible for more than 1500 licensed entities. These specialised institutions include small banks, credit
unions and building societies, friendly societies, insurers and superannuation funds.
Diversified Institutions Division (DID)
DID is responsible for the prudential supervision of more than 250 functionally diversified financial institutions. These
include large financial conglomerates, banks, insurance companies and superannuation firms.
DID specialise in financial and risk analysis and supervision across four branches. Analysts conduct prudential and
risk assessment duties on the institutions they are supervising. This involves off-site analysis of data and information,
regular contact with peers and senior executives within the supervised institutions, as well as on-site reviews of those
institutions.
Staff in both Specialised and Diversified Divisions are involved in:
• licensing new financial institutions;
• assessing the financial safety implications of mergers, acquisitions and major changes to financial institutions‟
business operations;
• monitoring institutions‟ financial position and outlook;
• assessing the main risks in and risk management systems of financial institutions; and
• dealing with problem situations and problem institutions.
Policy, Research and Statistics Division (PRS)
PRS develop the prudential framework in consultation with a range of stakeholders. PRS is responsible to ensure
that APRA‟s supervisors and other staff possess the best possible tools to support them in their risk analyses and
As per 31.March 2006 the total number of staff employed was 199,2 full-time employees. A detailed breakdown by
complexity of risk run by the institutions can not be provided.

a. 47
b. 81
c. 81
* The FTE figures above exclude Specialist staff (e.g., Actuarial, Capital, AML, Accounting, etc.) that are routinely
involvement in the supervision of financial institutions.

The total number of staff in 2005 vas 174. 22 person's work in one year vas used on inspections. We are not able to
make breakdowns complexity of risks run by the institutions
Currently there are 1618 employees. There is no strict classification of staff in relation to the supervision of special
risk and general risks or in dependence to the size of companies.
a) Staff for supervision of financial groups (diversified activities / “large and complex”)
b) Medium-risk institutions with moderate risks which can be isolated (turbulences in the system, but no systemic
risk)
c) Small market-specialists with negligible impact on operation of the financial sector

(March 2006 figures, colleagues directly involved in the on-site and off-site supervision, but excluding back-office
activities)
a. 46 colleagues (supervisors, IT experts and legal experts)
b. 46 colleagues
c. 135 colleagues

Not relevant at the FME.
Staff numbers are not analysed on the basis specified as this does not reflect the manner in which the staff
complement is set out in our budget.
Breakdown of staff numbers as at 31 December 2005
Staff Numbers as at 31 December 2005 Total for Division
Departments reporting to Chief Executive Senior Management 3.0 50.0
 Legal & Finance 25.0
 Registrar of Credit Unions 17.0
 Planning & Project Co-Ordination Unit 5.0
Prudential Division Banking Supervision 45.0 182.5
 Insurance Supervision 26.0
 Financial Institutions & Funds Authorisation 65.0
 Securities & Exchanges Supervision 46.5
Consumer Division Consumer Information 32.5 85.5
 Consumer Protection & Codes 53.0
Overall Total 318.0




                                                                                                                      1653
Breakdown Full-time staff equivalent
a) Large and complex financial groups with diversified activities 47
b) Medium-risk institutions with moderate risks that can be isolated (turbulences in the system, but no systemic risk)
56
c) Small market specialists with negligible impact on operation of the financial sector 63
d) Indirect supervisory activities (policy, methodology, projects, etc) 154
Total Supervisory Full-Time Staff Equivalent 320
[Internal Note: FTE breakdown by departments (excludes projects):]
Breakdown BD CI ID SRD
 MCD SFD PPD
a) Large and complex financial groups 9 18 4 8* 2* 6 -
b) Medium-risk institutions 16 3 21 8* 3* 5 -
c) Small market specialists 31 11 2 - 6 13 -
d) Indirect supervisory activities (policy, legal services, methodology, projects, etc) 18 13 7 19 17 62 18
Total 74
45
34
35 28 86
18

* To support banks and insurers.
                          15. What is the average age of staff (years), 16. What is the average staff tenu
                          Average age of staff (years)      Average tenure (years)
Australia (APRA)                                         36          5.6
Austria (FMA)                                            35 2.25 (still rising)
Belgium (CBFA)
Canada (OSFI)                                         44       9.08
Denmark (Danish FSA)                                  41         9.5
Germany (BaFin)                                       38 Most of the BaFin employees are civil servants. The experience f
Hungary (FSA)                                         42           8
Iceland (FME)                                         43         9.7
Ireland (IFSRA)                                      35.2        8.5
Japan (FSA)
Korea (FSS)                                         40.39         13.2
Netherlands (DNB)
Norway (Kredittilsynet)
Sweden (FI)
Singapore (MAS)                                          32        5.5
United Kingdom (FSA)
years), 16. What is the average staff tenure at your authority (years)?




aFin employees are civil servants. The experience from the past (from the former supervision authorities) shows that‟s not unusual that most of the emplo
s) shows that‟s not unusual that most of the employees stay in the authority until their retirement. Often they start their career in BaFin after a short time w
they start their career in BaFin after a short time working experience in the economy. So their tenure is comparatively long.
Australia (APRA)
Austria (FMA)
Belgium (CBFA)
Canada (OSFI)
Denmark (Danish FSA)
Germany (BaFin)
Hungary (FSA)
Iceland (FME)
Ireland (IFSRA)
Japan (FSA)
Korea (FSS)
Netherlands (DNB)
Norway (Kredittilsynet)
Sweden (FI)
Singapore (MAS)
United Kingdom (FSA)
15. What is the average age of staff (years), 16. What is the average staff tenure at your authority (year
Average age of staff (years)
                                                                                            36
                                                                                            35

                                                                                           44
                                                                                           41
                                                                                           38
                                                                                           42
                                                                                           43
                                                                                          35.2

                                                                                         40.39




                                                                                            32
nure at your authority (years)?
                 Average tenure (years)
                          5.6
                 2.25 (still rising)

                       9.08
                         9.5
                 Most of the BaFin employees are civil servants. The experience from the past (from the former supervision authorities) shows that‟s
                           8
                         9.7
                         8.5

                        13.2




                         5.5
m the former supervision authorities) shows that‟s not unusual that most of the employees stay in the authority until their retirement. Often they start their c
uthority until their retirement. Often they start their career in BaFin after a short time working experience in the economy. So their tenure is comparatively lo
in the economy. So their tenure is comparatively long.
   Australia (APRA)




    Austria (FMA)

   Belgium (CBFA)

    Canada (OSFI)



Denmark (Danish FSA)




   Germany (BaFin)




   Hungary (FSA)



    Iceland (FME)



   Ireland (IFSRA)

    Japan (FSA)
    Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)
  Singapore (MAS)




United Kingdom (FSA)
17. Please, indicate staff turnover (in %) a. At the supervisory agency?
b. At the central government?
c. In the industry?


a. Total turnover, 21%; voluntary, 18%; voluntary in operational divisions (excluding Corporate areas), 15%
(2004/2005)
b. 13%
c. 22%

a. 10,6% in 2005; 5,7% in 2004
b. Not available
c. About 10 -12 %


a. 9.5%
b. N/A
c. N/A

a. 14,6%
b. 11,5%
c. We don't have any information

a. approx.1 %
b. --
c.
insurance sector 5,5% in 2004
banking sector 11,87 % in 2004

a. 13 %
b. N.a.
c. N.a.

a. 17.1 % (2005)
b. N.a.
c. N.a.

a. 14.4% (in 2005)
b. Not available
c. 22.6% (in 2005)



N/A
a. At the supervisory agency?
The annual staff turnover for 2005 was 14%.
[Internal note: FSG staff only and excludes transfers of FSG to non-supervisory functions.]

b. At the central government?
Information is not available.

c. In the industry?
The annual staff turnover (resignation rate) in the financial services industry was 20.4%. This figure is inclusive of
support staff.
[Based on resignation rate (exclusive of retrenchment) in Labour Market 2005 report complied by MOM].
  Australia (APRA)




   Austria (FMA)



  Belgium (CBFA)

   Canada (OSFI)



Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)




   Iceland (FME)




   Ireland (IFSRA)

    Japan (FSA)
    Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
18. What is the average salary of a staff member? (total yearly cash renumeration and total
yearly fringe benefit in USD terms if any)
a. At the supervisory agency
b. At the central government
c. In the industry (broken by sector if possible)


a. $69,800* (average total remuneration - excludes statutory office holders)
b. $51,740* (average public sector total remuneration)
c. $57,200* (average total remuneration across entire Finance sector which includes back office and processing
staff)
* Salaries as at March 2006

a. $ 57.200,-- (private employees, excluding top management: executive board members and section heads, fringe
benefits include pension fund payments)
b. Not available
c. Average salary for Securities Traders in Banks: $ 68.400,--; Average salary in credit/loan departments in Banks: $
58.200,--


a. $79,358 + 28.5% benefit rate (USD)
b. N/A
c. N/A

a. 76,482 USD (no fringe benefit)
b. 74,151 USD (no fringe benefit)
c. We don't have any information.

a. 59382,00 US$ (47.129,00 €)
b. --
c.
insurance sector 61,651,00 US$ (48.930,00 €) in 2004
banking sector 61,167.00 US$ (48.546,00 €) in 2004


a. 62.8 thousand USD
b. n.a.
c. 52.1 thousand USD (without fringe benefits)

a. At the supervisory agency
USD 84.900
b. At the central government
We do not have this information
c. In the industry (broken by sector if possible)
We do not have this information

a. $67,000
b. Not available
c. $85,000



N/A
o At the supervisory agency
• Average yearly remuneration for supervision staff • US$66,500
• Average yearly fringe benefits* • US$820
• Average monthly salary for supervision staff • US$3,850
include medical and health screening expenses, staff insurance, childcare subsidy but exclude statutory benefits like
annual leave and sick leave.
[Internal note: FSG staff only].

o At the central government
Information is not available.
o In the industry (broken by sector if possible)
The average monthly salary for the financial services industry is US$3,820. This figure is inclusive of support staff.
[Internal note: Based on Labour Market 2005 compiled by MOM) – (US$3,820)]
  Australia (APRA)


   Austria (FMA)

  Belgium (CBFA)




   Canada (OSFI)




Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)
    Iceland (FME)




   Ireland (IFSRA)




     Japan (FSA)




     Korea (FSS)

 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
19. How many hours are devoted to training in a year (hours/staff member)? Please
specify education (i.e. general education like EFFAS, CFA CA etc, ) and training (special
knowledge like presentation, anti fraud, internal preparation for supervision etc)
separately if possible.


44 hours in 2004/2005. See below for fill breakdown of training and post graduate studies support.


On average 96 hours per staff member. Employees taking part in general education such as CFA or post graduate
studies contribute almost their entire training time for this purpose (in these cases training time is of course high
above average). Newly recruited staff tends to consume more training time than experienced staff.

Type of Training Average Days per Employee
2005/06
Accreditation/Degree Programs .03 days
Behavioural Training
(includes Leadership, Teambuilding) .69 days
Conferences
(includes all-staff conference & external conferences) 2.51
Individual Training
(training arranged by individual RCs) .75
IT Training
(includes training on Word, Outlook, PowerPoint, etc, as well as specialized training for IT employees) .39
Language Training
(includes Private & group sessions) .21
Lifestyle & Wellness .01
Technical
(Technical competency training organized by PD&T)
*higher than normal average this year due to BSII training initiatives 2.99
Total
*higher than normal due to All-Staff conference and BSII training initiatives. Total average usually runs around 5 days
per year. 7.58

In Finanstilsynet all new employees attend courses covering the subjects listed in the attached file. They attend the
courses during the first 3 years of employment. If they know all about some of the subjects from previous work they
don't attend these specific courses. The teachers are colleagues as well as professional teachers. The first year it
takes 94 hours, the second year 106 hours and the third year 43 hours. Add to this many courses that the employees
apply for and which are granted.
The staff is engaged to participate in trainings (at least three days a year). The average attendance added up in 2005
to 4.7 days of training per employee.

We are in the process of implementing a new concept of training with special courses for new staff, experienced staff
and executives. The concept includes courses to foster expert knowledge as well as social and personal
competencies. We are planning to organize more inhouse trainings than external trainings in the future. For the
training of the junior staff we will use mostly internal trainers who pass on their experience.
Our president approves that a few employees per year can take part in special training-programmes line the CIIA and
CCrA.

General education: 67 hours/years/staff, special knowledge: 15 hours/staff/years
To further strengthen the professionalism, the Financial Supervisory Authority issued a special educational scheme
in 2001. The Financial Supervisory Authority employees use annually an amount equivalent to 3% of the Authority´s
wages and wage-related expenditure, for educational purposes. Different categories of education have been
identified. The Authority has a three persons training committee. Objective for a training program is set once a year
by the training committee and the Director General. Individual objectives are also reviewed and the committee also
approves training requests on demand.
Approximately 1 day per staff member per year is devoted to training. However, this figure only refers to training
organised directly by the Training Unit off-site and does not include staff pursuing further professional qualifications
or technical training provided in-house.

      FSA provides systematic training programs for its staffs. There are the following three types of training programs;
i. “General Training Programs" - for new recruits and staffs from other organizations to acquire general and basic
knowledge
ii. “Basic Training Programs" - for all staffs to acquire necessary operational skills in supervisions, inspections and
others,
iii. “Professional Training Programs" - for selected staffs to acquire and enhance their professional knowledge and
skills. The third programs vary according to staffs‟ operations and contain both bureau-specific and cross-bureau
ones.

Total Training Education
Number of Trainees 28,541 10,711 17,830
Days of Training 100 N/A N/A




The average training hours per staff member for 2005 is 122 hours, and includes both general development and
functional training.
   Australia (APRA)
    Austria (FMA)
   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
  Germany (BaFin)
   Hungary (FSA)
    Iceland (FME)
   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)
 Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)

   Singapore (MAS)

United Kingdom (FSA)
20. What is the average number of hours worked per week at your authority?

Staff are required to work a minimum 38 hours a week but the average hours worked are much higher. However,
specific attendance hours are not recorded.
Contracts are for 40 hours, effectively some overtime has to be added, so the real average is about 41 hours.

The working week is 37.5 hours.
37 hours inclusive lunch break.
The average number of hours worked per week at BaFin is 41 hours.
41.1 hours /week
49 hours

The statutory working hours for national public servant is 40 hours per week.
45 hours per week




The average number of hours worked per week is 42 hours.
[Internal note: The above is official working hours. HR estimates the average number of hours worked is 47.5 hrs,
assuming that staff work from 8:30 – 19:00, 5 days a week (excludes lunch break and over-time).]
Australia (APRA)




 Austria (FMA)




Belgium (CBFA)
   Canada (OSFI)


Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)




   Iceland (FME)




   Ireland (IFSRA)




    Japan (FSA)
     Korea (FSS)




 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
21. Is there any legal obligation for coordination with other authorities in any area of your
activities? Please, explain.

There is no blanket legal obligation under APRA‟s legislation to coordinate with other authorities. However, APRA
and other agencies involved in Australia‟s banking regulation have defined mechanisms for interaction and
coordination of actions. APRA participates in a number of councils, committees and working groups with Australian
Securities and Investments Commission (ASIC), the Reserve Bank of Australia (RBA), the Treasury and the
Australian Transaction Reports and Analysis Centre (AUSTRAC), in which regulatory policies and supervisory issues
are dealt with in a coordinated manner. APRA and the other regulatory agencies act together on investigations and
enforcement actions that cross more than one agency‟s mandate. An example of this is APRA‟s recent investigation
into irregular foreign currency options at National Australia Bank.

The Council of Financial Regulators (COFRs) is the coordinating body for Australia‟s main financial regulatory
agencies: APRA, the RBA, ASIC and the Treasury. As specified in the Council‟s Charter, the Council‟s role is to
contribute to the efficiency and effectiveness of financial regulation by providing a high level forum for cooperation
and collaboration among its members. It operates as an informal body in which members are able to share
information and views, discuss regulatory reforms or issues where responsibilities overlap and, if the need arises,
coordinate responses to potential threats to financial stability.

APRA meets regularly with the RBA and ASIC through the RBA/APRA Coordination Committee, the APRA/ASIC
Liaison Meeting and the Tripartite Data Committee (TDC). The latter involves APRA, the RBA and the Australian
Bureau of Statistics (ABS) meeting quarterly to discuss high level data issues, reporting form changes, emerging
data requirements and emerging issues, such as International Financial Reporting Standards (IFRS).

APRA meets with AUSTRAC on anti-money laundering and counter terrorism related issues. Both APRA and
AUSTRAC are members of the Financial Action Task Force/Asia Pacific Coordination Group, which brings together
representatives from the Attorney-General‟s Department, the APG Secretariat, the Australian Federal Police, the
National Crime Authority, the Department of Foreign Affairs and Trade, the Treasury, the Australian Customs
Service, the RBA, AUSTRAC and APRA.

Under specific APRA industry legislation, there are requirements to consult with other authorities such as ASIC and
the Australian Taxation Office on specific matters.

APRA also has in place Memoranda of Understanding with many agencies to share information and coordinate
particular activities, such as:
1. Domestic agencies
Pursuant to Section 13 of the Financial Market Authority Act a Financial Market Committee in the form of a platform
encompassing all institutions responsible for the stability of the financial market shall be established at the Federal
Ministry of Finance to promote interinstitutional cooperation and exchange of experience. This committee consists of
one representative each of the FMA and the Austrian Central Bank as well as one representative of the Federal
Ministry of Finance from the area of legislation appertaining to financial market supervision at the Federal Ministry of
Finance. The Financial Market Committee is convened by the chairperson or prior to his appointment by the Federal
Minister of Finance, at least four times a calendar year. Upon the proposal of two members, it is convened at short
notice. The Financial Market Committee may adopt recommendations on financial market issues with a majority of
votes.
Further, if the FMA issues regulations, it has to inform the Federal Minister of Finance of its intention and submit the
regulations prior to their issuance including the result of the hearing of the Austrian Central Bank to the Federal
Minister of Finance. (Section 16 of the Financial Market Authority Act). Some regulations are subject to the approval
Yes, OSFI is required to coordinate its activities with other Financial Institutions Supervisory Committee members.
FISC is a statutory committee headed by the Superintendent. FISC members are OSFI, Bank of Canada, Canada
Deposit Insurance Corporation, Department of Finance and the Financial Consumer Agency of Canada. The main
purpose of FISC is to discuss safety and soundness issues as they pertain to federally regulated financial
institutions.
No
According to Section 7 German Banking Act BaFin and the German Central Bank have to coordinate its work with
respect ot banking supervision. (see: http://www.bundesbank.de/download/bankenaufsicht/pdf/kwg_e.pdf) .
The “Agreement concerning co-operation between the BaFin and the Deutsche Bundesbank in the supervision of
credit and financial services institutions” supplements this section and emphasises the co-operation concerning day
to day business.

As regards securities supervision the BaFin co-operates regularly with other supervisory agencies, e. g. the stock
exchange supervisory agencies of the federal states (Länder; § 6 WpHG). Moreover, the BaFin consults the
supervisory offices of the Länder once a year with regard to topical items concerning supervision during a meeting of
the securities council, consisting of representatives of the Länder.

Co-operation in the insurance sector takes place with the insurance supervisors of the federal states (§ 150 VAG).
There is a meeting twice a year to exchange supervisory views and problems.


Hungary (FSA)
Yes. As it was mentioned above, a bank‟s licence can be withdrawn by a common agreement of the HFSA, the
National Bank of Hungary and the Ministry of Finance. Some banking activities in connection with payment and
settlement systems are licensed by the National Bank of Hungary.
Concerning mergers and acquisitions of supervised institutions the HFSA is obliged to cooperate with the Hungarian
Competition Office.
Regarding financial legislation and regulation, the HFSA is obliged to support works in this area together with the
National Bank of Hungary, the Ministry of Finance and the Ministry of Justice.
Hungary is represented in most of the international financial organisations (OECD, etc.) by co-delegates or
delegation is shared with other authorities, typically with the National Bank of Hungary and the Ministry of Finance.


According to Article 15 in our Law on Official Supervision of Financial Operations no. 87/1998 (luf) the FME shall
have regular consultative meeting with the representatives of the Central Bank of Iceland.
According to Article 12 in the mentioned law the FME is obliged to notify the State Police Commissioner in the event
of a serious infringement where party subject to supervision has in the FME opinion committed a criminal offence.
The Minister of Commerce approves of licences and revokes licences on the insurance market after the FME has
given its opinion.
The Minister of Finance approves and revokes licences of Pension Funds after the FME has given its opinion. The
FME also gives its opinion regarding new and changes of Pension Funds Articles of Association.
The FME refers to question under legal power regarding sharing information with other domestic authorities.

The Financial Regulator is obliged (subject to EU professional secrecy obligations) to report to the relevant
enforcement authorities any suspicion it has that a firm supervised by it has committed a criminal offence or a breach
of companies or competition legislation. The Financial Regulator is also under a duty to make reports to the police
and the Revenue Commissioners under Irish anti-money laundering and terrorism financing law, where any suspicion
arises in relation to a regulated institution.
Finally, in areas which have been coordinated by EU Supervisory Directives (e.g. the regulation of credit institutions,
investment firms and insurance undertakings), the Financial Regulator liaises with the competent authorities of other
EU jurisdictions in accordance with the terms of the relevant Supervisory Directive.

With regard to the frameworks of information sharing, it is clearly stipulated in the Bank of Japan Law, the Deposit
Insurance Law and each business law.
 [Relation with the Bank of Korea]
- When the Bank of Korea (BOK) deems it necessary, the BOK may require the FSS to jointly examine financial
institutions (§62).
- When the FSC takes any measures that have a direct bearing on monetary and credit policy, to which the Monetary
Policy Committee is opposed, the BOK may request reconsideration of such measures (§63).
- The Minister of Finance and Economy, the Monetary Policy Committee, and the FSC may request from each other
any information necessary for the conduct of their policies. The requested information must be given unless there is
a special reason to refuse the request (Article 65).
 [Relation with the Ministry of Finance and Economy]
- The Ministry of Finance and Economy must consult with the FSC in the case of formulating or amending laws and
subordinate statutes relating to financial supervision (§64-2).
-2).
).

- The Minister of Finance and Economy, the Monetary Policy Committee, and the FSC may request from each other
any information necessary for the conduct of their policies. The requested information must be given unless there is
a special reason to refuse the request (§65).
 [Relation with the Korea Deposit Insurance Corporation]
- As necessary, the Korea Deposit Insurance Corporation (KDIC) may request a joint examination of an insured
financial institution (§66).

[Others]
- On January 20, 2004, the FSS, the BOK, and the KDIC signed an MOU on information sharing, which expanded




The MAS is the sole supervisor of the financial system. As the integrated supervisor and regulator for banking,
insurance and capital markets, MAS interacts and works closely with following authorities to complement its
supervision of the financial services sector:
Commercial Affairs Department (CAD):
The Commercial Affairs Department (CAD), a department of the Singapore Police Force, carries out investigations
into contraventions of the MAS statutes that attract criminal sanctions. Criminal prosecutions arising from such
investigations are carried out by the Public Prosecutor's office of Singapore's Attorney General's Chambers.
Under the Securities and Futures Act (“SFA”), a complementary regime (the civil penalty regime) exists alongside the
criminal regime for the treatment of market misconduct contraventions such as insider trading, market manipulation
and false trading. MAS investigates and brings prosecutions for market misconduct cases under the civil penalty
regime. To prevent overlaps and conflicts in the management of market misconduct matters, MAS and CAD have an
investigation protocol to guide both agencies in the allocation of market misconduct cases for either criminal or civil
penalty investigation.
The Singapore Exchange (SGX):
SGX operates a securities market, a futures market, and their respective clearing facilities. As part of its self-
regulatory function as an operator of markets and clearing facilities, SGX is statutorily obliged under the SFA to
ensure the fair, orderly and transparent functioning of its markets, and the safe and efficient functioning of its clearing
facilities. In doing so, SGX is responsible for the processing of membership applications and permits; exercising
financial supervisory responsibilities over its member companies and participants for compliance with its business
and listing rules and to ensure the continued financial strength of its members. SGX is also responsible for the
surveillance and detection of trading irregularities, and investigating complaints concerning its member companies
and their trading representatives.
MAS, in administering the SFA, licenses capital market intermediaries, such as securities dealers and futures
   Australia (APRA)
     Austria (FMA)
   Belgium (CBFA)
     Canada (OSFI)
Denmark (Danish FSA)
   Germany (BaFin)
    Hungary (FSA)
     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
1. Please indicate the scope of your supervisory responsibilities.




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   Australia (APRA)
     Austria (FMA)
   Belgium (CBFA)
     Canada (OSFI)
Denmark (Danish FSA)
   Germany (BaFin)
    Hungary (FSA)
     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
2. Please, describe your authority’s supervisory approach by ticking in the relevant
box:




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   Australia (APRA)
     Austria (FMA)
   Belgium (CBFA)
     Canada (OSFI)
Denmark (Danish FSA)
   Germany (BaFin)
    Hungary (FSA)
     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
3. What was the number of on-site inspections in 2005 broken by markets?




                        PLEASE CLICK HERE TO VIEW CONTENTS
  Australia (APRA)




   Austria (FMA)




  Belgium (CBFA)



   Canada (OSFI)




Denmark (Danish FSA)

  Germany (BaFin)
   Hungary (FSA)




    Iceland (FME)




   Ireland (IFSRA)




     Japan (FSA)



     Korea (FSS)



  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
  Singapore (MAS)




United Kingdom (FSA)
4. Please, explain the main features of supervisory resolutions issued in 2005 (what
were the typical problems, etc.).

During 2004/2005, APRA undertook 741 enforcement actions, almost double the previous year‟s level. The
increase was largely attributable to the issue of infringement notices to a number of superannuation funds that
failed to disclose their status under the Superannuation Industry (Supervision) Act 1993 (SIS Act) or failed to
lodge their APRA annual return on time.

In 2004/2005, 18 APRA investigations were in process. Some of these were a continuation of investigations
commenced in previous years and which culminated in formal enforcement action.

APRA disqualified 40 individuals in 2004/2005, including the first disqualifications of individuals assessed as not
fit and proper under the amended Insurance Act 1973.

Banking Supervision

the risk of interest rate changes and the preparations for Basel II.

conditions, because of violation of regulatory provisions, e.g. inappropriate risk management (Section 70 para. 4
of the Austrian Banking Act). In 86 cases the FMA charged interests on credit institutions for violation of
regulatory provisions concerning the own funds, the first and second degree liquid funds and limits of large
exposure (Section 97 of the Austrian Banking Act).
Insurance Supervision

requirements, the investment rules and the internal auditing. The off-site analyses concentrated on the annual
accounts, the audit reports from statutory auditors and the audit reports from auditing actuaries. The supervision
also concerned the fulfilling of information duties of life insurances (incl. fulfilment of Minimum Standards issued
by the FMA) as well as claim settlements in mass segments of other than life insurances.

undertakings.
Securities Supervision

organisation (particularly for financial institutions), organisation of the securities field of banks or investment firms

One or more issues may have resulted in the decision to “stage” and institution:
• Capital weakness/failure to comply with minimum capital requirements (6)
• Weaknesses in anti money laundering practices (3)
• Weaknesses in risk management practices (2)
• Weaknesses in internal control (1)
• Compliance issues (1)


Finanstilsynet has a very wide spectrum of different tasks. Typical problems in 2005 were within the normal tasks
of Finanstilsynet, e.g. issuing of authorisations and licenses, reviewing regular reports and on site inspections.
In 2005 the Minimum Requirements for Risk Management (MaRisk) were issued. The document is available on
our website: http://intranet:8071/rundschreiben/89_2005/051220_en.htm
Resolutions are only one sort of instruments the HFSA use for correction of problems. According to the principle
of proportionality and proactivity applied by the HFSA, prudential consultations, management letters and other
legally non-binding instruments are preferred in prevention as well as in solution of cases where formal
instruments are not available or are considered unreasonably rigorous. Resolutions are used as instruments of
informal power as well: they are published on the website of the HFSA.
Insurance market: Insurance contract law, information requirements regarding legislation contents, increased
supervision on solvency, ancillary activities, risk management and stress testing.
Securities market: Flagging, market abuse, insider fraud, takeover, suspected offers to the public of unlicensed
financial services, inspections of issuers, administrative fines for infringements of transaction reporting
requirements and insider transactions.
Credit market: Risk management, risk assessment system and stress tests were applied by the FME,
concentration of large exposures, the preparation of implementing Basel II standards, supervision of qualifying
holdings, fit and proper assessment for managing directors and board members of parties subject to supervision,
participation in business activities.

Pension market: On-site inspections, surveys on investments and liabilities, examinations of investment policies
and internal control and risk management, fit and proper tests for directors of pension funds.


The general types of issues which have arisen from on-site inspections include:

i. Inadequate status of risk management committees;
ii. Under evaluation of operational risk issues;
iii. Directors and senior management being appointed without prior approval;
iv. Inaccurate computation of capital adequacy position;
v. Internal controls not aligned to business operations, e.g. lack of segregation of duties, procedures manuals out
of date, business recovery plans not in place or insufficient;
vi. Compliance officers, in certain sectors, falling short of the expected level of knowledge of our regulatory
requirements;
vii. Inadequate compliance with anti-money laundering obligations; and
viii. Lack of clarity regarding the control / management and designation of client money.

Typically, following any necessary dialogue to outline our concerns and expectations, a programme to rectify any
weaknesses identified is agreed for implementation by financial service providers. See also Question 6 below.


We have strengthened pre-emptive and risk-based supervision:
(Example 1) By introducing the Relationship Manager system, which strengthened continuous monitoring of
financial institutions, we established a pre-emptive risk-based supervisory system.
(Example 2) Fluctuations in the real estate market may increase risk to financial institutions due to ailing housing
loans. We are pre-emptively responding to these market changes through various measures such as
strengthening the Loan-to-Value ratio.
Insurance
Directions were issued in August 2005 to an insurance broker to cease arranging new insurance contracts and
renewals of insurance contracts for contraventions of the Insurance Act.
Capital Markets
A prohibition order and reprimand were issued for breach of market and business conduct rules.

[Internal Note: Breakdown]
Insurance Securities & Futures Financial Advisors
Stop renewing or issuing further policies of the class of business (s41)

1
Written directions to cease arranging new insurance contracts and renewals of insurance contracts were issued
under IA section 41(1)(e) in August 2005 to DC Williams for contraventions of the Insurance Act. Reprimand for
misconduct (s334)


1
This was in relation to the contravention of regulations relating to price stabilisation action, where the price
stabilisation actions for an IPO were conducted at prices higher than that permitted under the regulations.
Reprimand given self reporting and other mitigating circumstances on the facts of this matter Issue prohibition
orders (s59)


1
The Prohibition Order was in relation to a fraudulent act committed by a financial adviser‟s representative.
Australia (APRA)




 Austria (FMA)




Belgium (CBFA)
   Canada (OSFI)




Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)
Iceland (FME)




Ireland (IFSRA)




 Japan (FSA)
     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
  Singapore (MAS)




United Kingdom (FSA)
5. If your authority has the power to investigate,
a. Is your authority permitted to exercise this power at the request of a foreign
supervisory authority?
b. If yes, under which conditions?
c. Please, describe precisely the limits of your authority’s investigative power
(including the tools that might be used).


a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
No, APRA currently does not have this power, but is seeking to include this power in future legislative
amendments.
b. If yes, under which conditions?
Not applicable.
c. Please describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
We have interpreted „investigative‟ to mean formal investigations under APRA‟s statutory powers. See Table A.

All supervisory laws (Banking Act, Securities Act, Insurance Supervisory Act and Pensions¬kassen Act) provide
for cooperation with foreign supervisory authorities.
A. Banking Supervision
The Banking Act (Section 77) provides for communication of official information by the FMA to foreign banking
supervisory authorities under the condition that:
1. the public order, other substantial interests of the Republic of Austria, banking secrecy and the duty of secrecy
in tax matters (Section 48 Federal Tax Act) are not violated thereby;
2. it is ensured that the requesting state would comply with an Austrian request of the same kind; and
3. and if a request for information of the same kind by the FMA would be in accordance with the objectives of this
federal statute.
In turn the FMA may request a competent authority of a Member State or a third country (under the condition of
mutual cooperation) to verify information available to this authority on a subsidiary of a company situated in
Austria or a foreign credit institution in case its activity affects the Austrian financial market.
Securities Supervision
According to Section 30 WAG the FMA is to be permitted to forward data as for example information relating to
the licenses of investment service providers; data on transactions that are subject to reporting requirements;
shareholders‟ equity and further more to competent authorities of Member States if required for the fulfilment of
their duties of pursuant to Articles 23 and 25 of Directive 93/22/EEC as amended by Directive 95/26/EC, or
pursuant to Article 10 of Directive 89/592/EEC, and insofar as this information is treated by these authorities as
profession secrets pursuant to Article 25 of Directive 93/22/EEC as amended by Directive 95/26/EC. The
information mentioned under paragraph 1 fig. 12, however, may not be passed on by the FMA without the
express consent of the competent authorities which sent it originally to the FMA. Under the same conditions
a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
i. The power to investigate does not explicitly include this provision although the power is quite broad. It provides
for conducting a direct investigation - or requiring the auditor of the FRFI to conduct an examination on our behalf -
on any area relating to the safety and soundness of the institution.
b. If yes, under which conditions?
i. See above.
c. Please, describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
i. These powers are described in sections 643, 644 and 325 of the Bank Act.
ii. The Superintendent may “make or cause to be made any examination and inquiry into the business and affairs
of each bank as the Superintendent considers necessary or expedient to determine whether the bank is
complying with the provisions of this Act and whether the bank is in sound financial condition…”
The power includes the right to access all books and records. In addition, the Superintendent may require the
directors, officers and auditors to provide information to support the examination.

a. Yes
b. No special conditions
c. Finanstilsynet does not have powers to investigate criminal charges

a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority? Yes.
b. If yes, under which conditions?
Securities Supervision:
BaFin may exercise all investigatory powers conferred upon it by the Securities Trading Act also on behalf of a
foreign securities regulator. In 2003, BaFin became a signatory of the IOSCO Multilateral Memorandum of
Understanding Concerning Consultation and Cooperation and the Exchange of Information, the widely recognized
benchmark for international cooperation. At the European level, BaFin also signed The CESR MoU and was
among the first EU Member states to transpose the Market Abuse Directive into national law. BaFin is also party
to an increasing number of bilateral MoUs. While some of these agreements focus on technical assistance,
most of them contain a fully fledged framework for cooperation and set out similar requirements as to the scope
and contents of requests for assistance in the context of which BaFin may exercise its investigatory powers. The
legal basis under national law for international cooperation in the securities sector is provided by § 7 Securities
Trading Act. Besides, there are a number of precepts relating to international cooperation within specific areas of
securities supervision (§ 36c and 37s Securities Trading Act (the latter entering into effect on July 1, 2005), § 19
Investment Act, § 8 Takeover Act. These provisions spell out the conditions under which BaFin may provide
assistance including the use of investigatory powers. These conditions can be summarized as follows:
a) Written Request: The foreign regulator must make a request for assistance to BaFin. The request has to be
made in writing, unless a bilateral or multilateral memorandum of understanding provides otherwise. Further, it
must state the facts underlying the investigation, the laws or regulations potentially violated, and the information
requested.
b) Scope: BaFin‟s investigatory powers may only be used on behalf of a foreign regulator in the area of securities
supervision. The pertinent areas of cooperation are spelled out in detail in the provisions cited above.
c) The requesting authority must demonstrate that the information which BaFin is asked to collect and transmit
will be kept confidential and only be used for the purposes specified in the response to a request or set out in the
pertinent memorandum of understanding.
If these conditions are met, BaFin may exercise all its powers under the Securities Trading Act or the other
The HFSA is not empowered to investigate.
a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
Yes
b. If yes, under which conditions?
If the FME believes that the request from foreign authority has sufficient reasons for investigation the FME can
exercise its power.
c. Please, describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
The FME is authorised to perform search at the operating site and may confiscate any material in accordance
with provision of the Law of Criminal Procedure, provided that there is strong reason to suspect that the party
subject to supervision has violated laws or regulations applicable to their operations, or if there are reason to
believe that inspections or measures by the FME will not succeed otherwise.
The FME can inspect the operation of parties subject to supervision as often as is deemed necessary. They are
obliged to grant the FME access to their accounts, minutes, documents and other material in their possession
regarding their activities which the FME considers necessary. The FME may appoint a specialist for inspecting
certain aspects of the operations or management of a party subject to supervision, or to undertake specific
supervision of such a party.
a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
Yes
b. If yes, under which conditions?
The Financial Regulator may choose to exercise any of its investigative powers following a request from a foreign
supervisory power, provided that the request relates to activity (or alleged activity) of the relevant firm which is
regulated by the Financial Regulator.
As a matter of practice, the Financial Regulator typically seeks to put any such arrangement on a formal footing
by way of non-binding memoranda of understanding with foreign supervisory authorities. Such memoranda would
describe the agreed terms and pre-conditions for such actions.

c. Please, describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
Where (i) the foreign supervisory authority is another EU competent authority performing functions ascribed to it
in accordance with EU law, or (ii) there is a memorandum of understanding on the relevant matter between the
two authorities, the Financial Regulator will act in accordance with EU law principles as to the cooperation with
and mutual assistance of EU to exercise authorities at the request of a foreign supervisory authority?
a. Is your authority permitted competent this power and/or the terms of such memorandum of understanding, as
     In the fields of securities, FSA can exercise investigation at the request from a foreign supervisory authority
based on the Securities and Exchange Law.
Nevertheless, this is not allowed in the fields of banking and insurance, although FSA exchanges information
which is related to supervision on a daily basis.
b. If yes, under which conditions?
Please refer to the above answer.
c. Please, describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
i. Request for some information
       FSA can request information from companies, issuers, stock exchanges, investors, etc. Nevertheless, as for
investors, the FSA can request information from them only in the case of investigation of their crimes.
 Note) For instance, when the FSA admits that it is necessary for banks to ensure their soundness and
appropriate managements, the FSA can request submitting reports or documents to the banks, their subsidiaries,
the main stockholders and the holding companies.


   The SESC can seize documents on the condition of permission of the court when it is necessary for the
SESC to investigate criminal cases.
We have comprehensive authority to investigate unfair trading practices in the securities market under the
Securities and Exchange Act.
a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
We can provide assistance to a foreign authority when the foreign authority requests examination or investigation
with the purpose and scope stated (§206-4-3, Securities and Exchange Act).
b. If yes, under which conditions?
We can investigate an offender in breach of foreign laws when the foreign regulatory authority requests
assistance in investigation, provided that the action of the offender constitutes a violation under Korean laws or is
prejudicial to the interests of the Korean public and investors (§206-3, §206-4, Securities and Exchange Act).
Article 206-4 (4) of the Securities and Exchange Act permits us to share non-public information with foreign
regulatory authorities according to the principle of reciprocity, provided that
1. information disclosed is not used for purposes other than the originally intended ones;
2. information disclosed and the fact that such information has been disclosed is kept confidential; and
3. information disclosed is not used for criminal investigations or legal proceedings without prior consent from us.
4. Please, describe precisely the limits of your authority‟s investigative power (including the tools that might be
used).
Under the Securities and Exchange Act, we have the authority to request the following from concerned parties:
- Submission of written statements
- Appearance to testify for the investigation
- Submission of books, documents and other materials for investigation
We can interrogate persons suspected of a violation, confiscate their belongings, or search their workplace.
We can impose administrative sanctions and indict a person under suspicion to the prosecutor.
However, we cannot take a person suspected of the violation into custody, or ask an operator of the
telecommunications business to peruse or to provide us with communication confirmation data.
a. Is your authority permitted to exercise this power at the request of a foreign supervisory authority?
i. Yes [Internal note: The IA (s49B), SFA (s172) and FAA (s78) sets out the conditions for provision of assistance
to a foreign regulatory authority. In relation to the BA, the assistance that BD may render would be limited to what
is already allowed in sections 45 and 46. In relation to the TCA, the assistance that SFD may render would be
limited to what is already allowed in sections 47 to 49. Both of these regimes are a lot narrower than what is
allowed under IA, SFA or FAA. Under section 46 BA, where a written report is produced by MAS upon an
investigation, the bank may disclose the report to another person which MAS has approved in writing under
section 46(2)(d). The corresponding provision in the TCA is section 48(2)(d).]

b. If yes, under which conditions?
i. Examples of such pre-conditions are
ii. the material requested is of sufficient importance to the carrying out of the supervision, investigation or
enforcement to which the request relates and cannot reasonably be obtained by any other means;
iii. the foreign supervisory authority has given a written undertaking that any material or copy thereof obtained
pursuant to its request shall not be used for any purpose other than a purpose that is specified in the request and
approved by MAS;
iv. The foreign supervisory authority has given a written undertaking not to disclose to a third party any material
received pursuant to the request unless the foreign supervisory authority is compelled to do so by the law or a
court of the foreign country;
v. the foreign supervisory authority has given a written undertaking to obtain the prior consent of MAS before
disclosing any material received pursuant to the request to a third party, and to make such disclosure only in
accordance with such conditions as may be imposed by MAS;
vi. the rendering of assistance will not be contrary to the public interest or the interest of the investing public.
vii. [Internal Note: It is possible for MAS to exercise investigative powers to assist a foreign regulatory authority
provided that the pre-requisites for MAS to commence investigations under the various Acts as well as the
conditions for provision of assistance (as stated in paragraph 1 above) are satisfied.
viii. Please note that in relation to the IOSCO MMOU, MAS was asked if we could use our powers of investigation
(eg. In section 142, 163 SFA) in the context of a request from a foreign regulator. Our response was as follows:
“The provisions in s142 and s163 (which is in relation to the carrying out of investigations under section 152) of
the SFA may be invoked only if the pre-requisites under s142 and s 163 are satisfied. If information had been
obtained by MAS pursuant to section 142 or 163 SFA and thus in MAS‟ possession, we can then rely on section
Australia (APRA)
   Austria (FMA)




  Belgium (CBFA)




   Canada (OSFI)




Denmark (Danish FSA)
Germany (BaFin)




Hungary (FSA)




 Iceland (FME)




Ireland (IFSRA)



  Japan (FSA)
     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
6. Which measures are available to your authority if the supervisory examination has
revealed shortcomings/ breach of the rules?

Insurers
APRA has the power to give particular types of directions in certain circumstances. The types of directions are to
direct compliance with a prudential standard, changing the provision for liabilities and the value of assets and
freezing the insurer‟s assets. Several pre-conditions must be met before these directions can be given and, they
are tightly constrained, with some requiring government approval before their use.

APRA can also accept enforceable undertakings from institutions and individuals in connection with a matter in
relation to which APRA has a function or power under the legislation.

APRA may apply for injunctions against an insurer that has engaged, is engaging or proposing to engage in any
conduct in contravention of the legislation or a direction given under the legislation.

Life insurers
APRA has the power to give a wide range of directions to life insurers provided particular „triggers‟ have occurred;
for example, if the company has contravened the Act, or the direction is necessary in the interests of policy
owners of the company.

APRA may apply for injunctions against a life insurer that has engaged, is engaging or proposing to engage in,
any conduct in contravention of the legislation or a direction given under the legislation.

Authorised deposit-taking institutions (ADIs)
APRA has the power to give a wide range of directions to ADIs and authorised non-operating holding companies
(NOHCs) provided particular „triggers‟ have occurred. For example; contravention of a prudential regulation or
standard or conducting affairs in an improper or in a financially unsound way.

APRA has the power to apply to the court for a range of injunctions. The injunction, if granted, can either restrain
the individual or institution from engaging in the conduct, or require the individual or institution to do another act.

Superannuation/pension funds
APRA can only give directions where a formal APRA investigation has commenced. It also requires government
consent. The types of directions which can be given include freezing the assets of the fund, so that it is unable to
dispose of, or deal in a particular way in, any assets of the entity.
Banking Supervision:
Concerning credit institutions the following administrative measures are available to the Banking Supervision
Department:
Powers to order the re-establishment of lawful conditions under penalty of fines.
In case of repetition or continuation of the unlawful behaviour:
• Powers to dismiss the entire or a part of the management
• Powers to impose fines against the credit institution
Powers to withdraw the licence, to engage in business if other measures cannot secure the functionality of the
credit institution.
The Banking Supervision Department has to impose the mentioned administrative measures if a condition for the
granting of a license no longer exists or if a credit institution violates clear defined provisions (Section 70 para. 4
Banking Supervision Act, BWG).
Furthermore the Banking Supervision Department has the possibility to publish the imposed administrative
measures in newspapers, on the Internet or in the business premises of the credit institution concerned (Section
70 para. 7 BWG).
Securities Supervision:
According to the Securities Supervision Act, the FMA can order the intermediary under threat of penalty to re-
establish lawful conditions within a period appropriate in view of the circumstances of the case if shortcomings or
unlawful behaviour have been revealed.
In case of repetition or continuation, the FMA can prohibit entirely or in part the managers of the intermediary from
conducting business, unless this would be inadequate; the sanction initially imposed is to be executed and the
order is to be repeated under threat of a higher fine.
If other measures cannot secure the functionality of the intermediary, we can revoke the licence.
Insurance Supervision:
Section 104 para. 1 Insurance Supervision Act (VAG) stipulates that the FMA shall issue any and all orders which
are necessary and appropriate to ensure compliance of the business activities with the provisions and recognised
principles of orderly business activities of insurance companies which apply to the operation of the contractual
insurance business. In order to avert a risk to the interests of the insured, the FMA may also take temporary
measures by issuing an administrative decision (Bescheid), which expire 18 months after having entered into
force at the latest (Section 106). If the continued solvency comes into question, the FMA may take specific, less
intense action according to Section 104a VAG.
According to its broad competence the FMA can take graduated action. The FMA may first ask the insurance
undertaking to take corrective action. If this does not succeed the FMA may issue an administrative decision or a

OSFI can take formal or informal approaches for dealing with identified shortcomings. Formal measures could,
for example, include legally enforceable “directions of compliance. Informal measures would include meeting with
an institution‟s senior management and its board with a view of achieving consensus on the approach to be taken
to address the issue(s). Examination findings are communicated at the CEO and Chairman of the Audit
Committee at the end of a review in the form of a Management Report. Management are required to respond to
the issues raised in the report.
See also Section II Question 5 for other powers, which may be exercised.

Orders or instructions to individual undertakings and revoking of licenses
Securities supervision:
If an entity subject to supervision has revealed unlawful behaviour BaFin can issue an administrative fine order.
This can be either a violation of the proprietor of the business itself or of someone else if the proprietor of the
company, as the party to whom this business-related duty applies, hat not committed the chargeable offence of
failing to take the necessary supervisory measures to prevent or made the infringements much more
difficult.Coercives
Coercives are available in all areas of supervision. If an entity does not satisfy public duties, e.g. does not publish
ad-hoc-notice, BaFin can use coercives. Options for coercives are substitutive execution and penalty payment. If
the substitutive execution costs money, BaFin can demand cost reimbursement from the party.
Banking supervision:
Measures in cases of inadequate own funds or inadequate liquidity
The Federal Financial Supervisory Authority may prohibit or limit withdrawals by the proprietors or partners, the
distribution of profits and the granting of loans (section 19 (1))
Measures in cases of danger
The Federal Financial Supervisory Authority may take temporary measures to avert the danger. In particular, it
may
1. issue instructions on the management of the institution's business,
2. prohibit the taking of deposits or funds or securities of customers and the granting of loans (sec¬tion 19 (1)),
3. prohibit proprietors and managers from carrying out their activities, or limit such activities, and
4. appoint supervisors.
Measures in cases of a danger of insolvency; appointment of persons authorised to represent the institution
The Federal Financial Supervisory Authority may, to avert insolvency proceedings, temporarily
1. issue a ban on sales and payments by the institution,
2. order the institution to be closed for business with customers, and
3. prohibit the acceptance of payments not intended for the discharge of debts to the institution, unless the
appropriate deposit guarantee scheme or investor compensation scheme undertakes to satisfy in full all those
entitled to satisfaction.
Insolvency petition
The petition for the initiation of insolvency proceedings over the institution's assets may be filed by the Federal
Financial Supervisory Authority only.
Moratorium, suspension of banking and stock market business
 (1) If there is reason to fear that credit institutions may encounter financial dif¬fi¬cult¬ies which are likely to pose
grave dangers to the national economy, and par¬ticularly to the proper functioning of the general payments
The HFSA is empowered to use supervisory measures and extraordinary supervisory measures according to the
significance and frequency of the problem. Proportionality is a very important principle in application of those
measures. Our tools range from management letter, consultations with the supervised institutions, etc. to the
withdrawal of the license as a final step. Between these two, there are a lot of other possibilities such as impose
fine, oblige the institution to elaborate a capital plan, a restructuring plan, call for changes in management, oblige
the institution to develop its IT system, increase of regulatory capital requirement, and so on.
According to Article 10 in our law, the FME shall insist on corrective action being taken within certain time limit.
The FME can also call a board or executive meeting of the party concerned to discuss its remarks and demands,
and discuss corrective action. A representative of the FME may chair the meeting and enjoy the right of speech
and make proposals. The special law for each market also has this requirement.
Depending on the facts and seriousness of the matter, the Financial Regulator may decide to resolve the matter
routinely, agree a settlement, impose a sanction via the Administrative Sanctions Procedure, initiate a summary
prosecution and/or refer the case to another authority or enforcement body as well as revoking the
licence/authorisation of a regulated entity. As already stated, Irish law regulating financial services is formulated
on a sectoral basis, so regard must be had to the details of the relevant sectoral legislation in identifying the
measures available. Nonetheless, the Administrative Sanctions Procedure applies to nearly all sectors.
The FSA have the measures of business improvement order, business suspension order, revocation of license,
etc. according to the each business law.
The supervisory authority can take the following measures on financial institutions and their staff:
1. Financial institutions: authorization and withdrawal of authorization, suspension of business, suspension of
illegal and improper behaviors, contract transfer, disclosure or posting requirements, notification to institution of
reprimand, and warning notification
2. Officers: recommendation of discharge, suspension from exercise of office, notice of censure, warning
3. Staff: dismissal, suspension, salary reduction, reprimand
4. Monetary sanctions: surcharges, fines
When the matter is insignificant, we can require improvement or on-site measures.




MAS may take regulatory actions against the supervised entities/parties for any non-compliance or breach of the
laws administered by MAS, including revocation of the licence, registration or approval. MAS also has the power
to offer a composition of certain offences. Apart from regulatory actions, our legislation also provide for criminal
sanctions which are initiated by the Attorney-General‟s Chambers.
Some measures available are:
Banking Insurance Securities & Futures Financial Advisors
Revoke licence (Internal: s20) Cancel registration (s12) Revoke approval/ licence/designation (s13, 58, 81Z,
 95) Revoke licence (s19)
Restrict or suspend operations of bank (s9(8)) Revoke the appointment of an administrator of a foreign insurer
scheme (s 35C(5))or the approval of a person as an actuary (s37(2)) Direct removal of an officer from office or
employment (s44, 81A, 81ZJ, 97) Direct removal of an officer from office (s57)
Direct a bank in Singapore to transfer to MAS such amount that is equivalent to the amount of deficiency in the
minimum cash balance (s39(5)) Issue prohibition orders (s35V) Issue stop orders (s282E, 297) Issue prohibition
orders (s59)
Order moratorium (s54) Direct a registered broker to remove the chief executive officer or director (s35ZJ) Issue
no action letters (s321) Issue no action letters (s64)
Direct bank to take any action or to do or not to do any act or thing whatsoever in relation to its business (s49)
   Australia (APRA)




    Austria (FMA)



   Belgium (CBFA)



    Canada (OSFI)



Denmark (Danish FSA)

   Germany (BaFin)



   Hungary (FSA)


    Iceland (FME)

   Ireland (IFSRA)


     Japan (FSA)
     Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
7. Is the decision to take administrative action at your discretion or it is obligatory to
intervene whenever a shortcoming/offence is identified?


A decision to take further action is at APRA‟s discretion. A decision is normally taken on this depending upon the
extent of threat to the interests of depositors, policyholders and fund members.
This depends on whether the relevant provisions of the supervisory laws foresee a discretion of the FMA in the
matter.
In administrative penal proceedings the FMA has to intervene ex officio whenever an offence is identified (Section
25 of the Administrative Penal Act). However if the fault of the accused person is minimal or if the consequences
of his act are minimal, the FMA can decide not to initiate proceedings (Section 21 of the Administrative Penal
Act).


OSFI has an early intervention mandate. It is expected that OSFI will intervene in a timely manner to prevent
undue loss to depositors or policyholders. The timing and the nature of the intervention is at the discretion of the
Superintendent although major decisions in respect of financial institution solvency would also involve FISC
members.
The decision to take “administrative” action is at OSFI‟s sole discretion. Please refer to the Administrative
Monetary Penalties (OSFI) Regulations - http://laws.justice.gc.ca/en/o-2.7/sor-2005-267/220639.html

Finanstilsynet is always obliged to react in cases of non-compliance

The decision to take administrative action is at the discretion of BaFin. In case that a punishment is not advisable
the discontinuance of proceedings is possible (§ 47 (1), sentence 2 Administrative Offences Act (AOA).
Taking administrative actions is typically at our discretion, however, there are cases defined exactly in the acts
when the HFSA is obliged to take supervisory actions. One of these cases is for example when a bank‟s solvency
ratio goes below 6%, 4% or 2% - the Act on credit institutions set the steps we shall make. Other examples: the
HFSA shall consider supervisory measures if a bank omitted to send its supervisory report at due time. The
HFSA shall make supervisory measures if a supervised institution conducts unauthorised activities.
It is the FME´s decision to take administrative action.
This will depend on the type of administrative action to be taken which is generally at the discretion of the
Financial Regulator. However, subject to certain conditions, the Financial Regulator is required by law to report,
as appropriate, suspicions of criminal offences to various domestic authorities, including: Garda Síochána (Irish
police); the Revenue Commissioners; the Director of Corporate Enforcement and the Competition Authority.
Under requirements stipulated in the Law, the FSA makes judgement whether it needs to take administrative
actions or not.
Depending on the degree of law violation, we have some discretion within a limited scope.




MAS has the discretion to determine the course of action to take.
   Australia (APRA)


    Austria (FMA)

   Belgium (CBFA)
    Canada (OSFI)
Denmark (Danish FSA)
   Germany (BaFin)
    Hungary (FSA)
     Iceland (FME)
    Ireland (IFSRA)
      Japan (FSA)
      Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
      Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
8. Does your authority have the right to take direct action? If not, please, explain.

APRA can normally take direct action; e.g. directions. In some circumstances such as the use of an injunction, it
must be applied for via a court. For criminal offences APRA needs to involve the Director of Public Prosecutions
(DPP) for prosecutions. The DPP‟s primary role is to prosecute offences against Commonwealth of Australia law
and to recover proceeds of crime committed against the Commonwealth.
The FMA can take direct action. The supervision of the financial market involves performing the official tasks and
exercising the powers which are assigned to the FMA by law. The relevant supervisory laws include a list of
offences which are prosecuted by the FMA in the course of administrative penal procedures.

Yes, the Superintendent has the right to take direct action. As noted previously, major decisions in respect to
financial institution solvency would also involve FISC members.
Yes
BaFin has the right to issue administrative fine orders and coercives dsed on a Law.
Yes, the HFSA has this right.
Yes.



In case of administrative measures, we can directly exercise them.




Yes, MAS has the right to take regulatory actions but all criminal actions are initiated by the Attorney-General‟s
Chambers.
   Australia (APRA)

    Austria (FMA)

   Belgium (CBFA)



    Canada (OSFI)



Denmark (Danish FSA)
  Germany (BaFin)

   Hungary (FSA)


    Iceland (FME)

   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)


   Singapore (MAS)


United Kingdom (FSA)
9. Is a relationship manager system applied at your authority?

In APRA there is a responsible supervisor appointed for each authorised institution.
In April 2006 the FMA has appointed a relationship manager who deals in first instance with external and internal
requests and complaints. This person is a trained conflict relationship manager. He also responsible for the
evaluation of the requests and complaints. In case of accumulated requests of investors in supervisory cases and
other crises he is furthermore responsible for the management of these cases.

Yes, each institution is assigned a relationship manager (RM) who is the most knowledgeable individual at OSFI
with respect to the institution. He/she is responsible for the quality of the assessments, ensuring they are
adequately supported. The relationship manager will call on specialist resources as required to support his/her
risk assessment. For smaller institutions, an RM may be responsible for a number of institutions, which promotes
consistency of assessments. For both small and large institutions, oversight by the Senior Directors provides
checks and balances on quality and consistency both between financial institutions within each industry as well as
across industries.
NA
No
Yes. In case of large financial groups, each group has a relationship manager. In case of smaller institutions 2-4
institutions belong to one relationship manager. Beyond continuous monitoring of its institution‟s activities, the
relationship manager is responsible also for completing of quarterly risk assessment of his/her institution(s), for
communication of changes in supervision to the supervised institution(s) belonging to him/her, etc.,
At present staff within the various departments are organised into teams which oversee different sectors within
the industry. Each team would be responsible for a number of institutions and the head of a team would maintain
the day-to-day relationship with the institutions they are responsible for.

No, the FSA don‟t adopt a relationship manager system.
Yes, we launched the RM system in February of 2005.




MAS adopts a portfolio approach to supervision. Institutions with similar business lines, characteristics, and risk
profiles are supervised by portfolio teams that exercise substantial judgment, oversee the group of like-institutions
and directly participate in ongoing supervision activities. This fosters ongoing relationships with institutions, build
supervisors' in-depth knowledge of institutions and their operating environments, and assures responsiveness
and continuity in supervisory matters.
  Australia (APRA)

   Austria (FMA)
  Belgium (CBFA)


   Canada (OSFI)


Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)
    Iceland (FME)




   Ireland (IFSRA)

     Japan (FSA)

     Korea (FSS)
  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)
   Singapore (MAS)
United Kingdom (FSA)
10. Please, explain the rules and regulations – if any - regarding the use of supervisory
fines collected by your authority.


APRA reporting standards require the submission of data for specific reporting periods and timeframes. Failure
to abide by the requirements of a reporting standard can incur a criminal sanction and may be in the form of a
monetary penalty. These sanctions are applied infrequently.
Pursuant to section 15 of the Administrative Penal Act the monetary fines go to social aid associations of the
province (Land) in which the fine was imposed (primarily the City and Province of Vienna).

OSFI has the authority to levy administrative fines pursuant to the Administrative Monetary Penalties (OSFI)
Regulations http://laws.justice.gc.ca/en/o-2.7/sor-2005-267/220639.html
Fines collected are remitted to the Receiver General of Canada. Note that OSFI does not generate any revenues
from fines collected.

NA
The range of the amount of the fines is written in the specific supervisory laws:
For the Securities Supervision of BaFin in the Securities Trading Act, the Securities Acquisition and Takeover Act,
the Sales Prospectus Act etc; for the Banking Supervision in the Banking Act.
According to Sections 144-144c Insurance Supervisory Law (VAG) the administration has the power to decide
upon misdemeanours or administrative fines up to 150.000 € depending on the severity of the offence. Every
offence exceeding the threshold of a misdemeanour is prosecuted by the public attorney‟s office.

The scale of the offence and the financial circumstances of the offender are taken into account.

According to the relevant acts and the internal regulation of the HFSA the fines shall not be used to finance
operation of the HFSA. The reason behind this approach is that in our understanding fine shall not be an
instrument of funding/financing of the supervisory authority and the supervisor shall not have any incentive to
increase its revenues from fines. Fine is rather a supervisory tool and only one in the choice of supervisory tools.
Fines collected from the money and capital markets shall be divided into two parts: 80% of the fines shall be
forwarded to the Deposit Protection Scheme and the Investor Protection scheme. Concerning the rest (20%)
together with the fines collected from the insurance and pension areas, a public tender shall be offered for
programs, equipments, studies, etc. in connection with development of the Hungarian financial sector, financial
literacy, consumer protection in the financial field, etc. .
The decisions regarding daily fines and administrative fines are made by the Board of the FME.
If the party subject to supervision does not provide requested information or heed requests for corrective action
within a certain time limit, the FME may resort to sanctions in the form of daily fines. The fines shall be collected
until the party has complied with the demands of the FME. The daily fines can amount to IKR 10.000-IKR
1.000.000 and can be determined as a proportion of certain figures in the operation of the party. When
determining the amount of daily fines, consideration shall be made for the nature of the negligence or violation
and the financial strength of the party subject to supervision.
The FME can impose administrative fines on a party subject to supervision in violation of decisions made by the
FME. The administrative fines can be between IKR 10.000-IKR 2.000.000. When determining the amount of the
administrative fines, consideration shall be made for the seriousness of the violation, and the financial strength of
the party subject to supervision.
Decisions regarding administrative fines and daily fines can be appealed to an Appeals Committee in according to
our Law within seven days from reporting the decisions to the party concerned. If a decision is appealed to the
Appeals Committee, the liquidated damages and the daily fines may not be collected until a verdict has been
rendered.
No supervisory fines have been collected by the Financial Regulator to date.
Administrative civil money penalty system has been introduced in April 2005 against unfair trading (e.g. insider
trading) and the submission of financial statements containing false information, which is stipulated in the
Securities and Exchange Law.
Financial penalties (e.g., surcharges, fines) collected by the FSC all go to the National Treasury.




No rules on that.
Australia (APRA)




 Austria (FMA)




Belgium (CBFA)
   Canada (OSFI)




Denmark (Danish FSA)
Germany (BaFin)




Hungary (FSA)




 Iceland (FME)

Ireland (IFSRA)
     Japan (FSA)




     Korea (FSS)




  Netherlands (DNB)
Norway (Kredittilsynet)
     Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
11. Please, describe the principles and institutional framework of supervision of
financial groups/conglomerates. (Is/are there separate units for supervision of these
complex institutions, how many organisational units are involved, what is the
distribution of responsibilities, what are the main focuses of supervision, what do you
think irrelevant for supervision of groups/conglomerates, etc.)


As an integrated prudential regulator of deposit-taking institutions, insurance companies and pension funds,
APRA adopts a group-wide focus to its supervision of conglomerate groups. Analysis of risks posed by non-
banking activities of a banking group are incorporated directly into APRA‟s supervisory framework for banks and
are addressed specifically in Prudential Standard APS 222 – Associations with Related Entities (APS 222).

APRA‟s Diversified Institutions Division supervises a number of conglomerate (diversified or complex) groups
from more than one industry group.

Banking
For example, APRA undertakes global consolidated supervision of banking groups. APRA has both stand alone
and group-wide capital requirements and requires the submission of data on a stand-alone and consolidated
basis. Material risks to the banking organisation from non-bank operations are also reviewed, analysed and
included in APRA‟s risk rating and supervisory action processes. In addition, APRA‟s conglomerates policy,
incorporating APS 222 and a third level of capital requirements for consolidated groups with non-consolidated
subsidiaries, is being implemented to ensure that all of the risks faced by the corporate group of the bank are
identified and managed.

To facilitate this level of supervision, APS 222 requires banks to provide APRA with details of group members,
management structure of the group, intra-group support arrangements and intra-group exposures. The bank
must notify APRA in advance of any proposed changes to the composition or operations of the group with the
potential to materially alter the group‟s overall risk profile and obtain APRA‟s prior approval for the establishment
or acquisition of a regulated presence domestically or overseas.

A bank is required to provide APRA with descriptions of group risk management policies and the procedures used
to measure and control overall group risk. An outline of its group risk management policies, including the policies
governing dealings between the bank and other group members must also be disclosed in the group‟s published
The FMA installed a separate unit which is responsible for the supervision of financial conglomerates. The unit
prepares the regulations as well as the definition and concretisation of financial conglomerates. The unit works in
close cooperation with the different supervisory departments. For the concrete supervision of a financial
conglomerate a team consisting of members of the special unit as well as of the banking, the insurance and the
securities supervision department is installed.
The special unit coordinates the supervisory strategy:
* the definition of special fields in supervising financial conglomerates;
* the concretisation and coordination of the annual supervisory planning and management hearings with each
concerned supervisory department.
Supervisory actions concerning financial conglomerates are taken by the responsible supervisory department on
the basis of the results of the investigations of the supervisory team.
OSFI‟s supervisory groups are divided into large (conglomerates- i.e., one group is responsible for both insurance
and banking conglomerates) and small institutions, then again by industry (deposit taking, life insurance, p&c
insurance). This enables the development and sharing of industry-specific knowledge and also helps ensure that
a consistent approach (i.e., level playing field) is applied to all financial institutions supervised by OSFI. It also
facilitates informal supervisory discussions and comparisons of assessments at all levels of the process. Note
that OSFI‟s Supervisory Framework (linked below) is applied to all federally regulated financial institutions to
ensure a consistent approach across industry sectors - http://www.osfi-bsif.gc.ca/osfi/index_e.aspx?DetailID=294
Finanstilsynet does not have a separate unit for group supervision. Instead, the supervision of groups is
organized by pointing out an internal group supervisor at Finanstilsynet. The group supervisor will have the
responsibility of securing that all major risk areas (credit risk, market risk, …) of the group are supervised in
accordance with the supervision plan for the group.

The supervision of the group is carried out by supervision of each of the financial undertakings in the group. The
individual financial undertaking is supervised by Finanstilsynet' unit responsible for this kind of business.
Therefore, the group supervisor will normally be a person fromFinanstilsynet' unit responsible for the financial
undertaking with the largest significance for the group.

The number of units involved in supervision of a group will depend of the number of different financial
undertakings in the group. By different financial undertakings are understood banks, mortgage-credit institutions,
investment companies, investment management companies, and insurance companies (life and non-life).
Therefore, supervision of a complex group can easily involve 3-5 units. In addition, units with responsibility for IT
and good practice can also be involved.

Internally, the group supervisor will at least once a year have a meeting with all other units in Finanstilsynet
responsible for a financial undertaking in the group. This should secure that the group supervisor has an overall
picture of all significant risk areas in the group. Besides these meetings, all relevant inquiries from the group, for
The EU Financial Conglomerate Directive has been implemented in German law. With the implementation, the
specific regulations for financial conglomerates are integrated into the Banking Act (Kreditwesengesetz – KWG)
and the Insurance Supervision Act (VAG).
For financial conglomerates that are active in more than one Member State, one national coordinator is to be
responsible as the decision-making authority (coordinator). Whoever becomes the coordinator will, for example,
result from which organisation heads up
the group, who has admitted this organisation, or also, which sector (banking/investment or insurance sector) is
the largest within the group. The tasks and responsibilities of the coordinator exclusively apply for overall
supervision of the financial conglomerate. Those responsible according to the respective sectoral regulations will
remain with the respective national supervisory authorities.

In particular, the tasks of the coordinator are:
• General supervision and assessment of the financial situation of a financial conglomerate.
• Coordination of collection and targeted passing on of expedient/essential information during ongoing monitoring
and in crisis situations, including the passing on of information that a
“responsible authority” requires in order to fulfil its supervision duties according to the sectoral guidelines.
• Assessment of compliance with regulations for adequate capital endowment and the stipulations regarding risk
concentration and internal group transactions.
• Assessment of the structure, the organisation and the internal control systems of the financial conglomerate.
• Planning and coordination of supervisory activities during ongoing supervision and in crisis situations in
cooperation with the “relevant responsible authorities”.

BaFin, as the integrated financial supervisor for German financial conglomerates, is responsible as the sole
national contact – irrespective of which role it takes within the coordinator model and
which sector the companies in the conglomerate belong to. Therefore, it particularly has an advantage in
comparison with having several sectoral supervisory authorities. This applies even more, as the currently
ascertained and reported German financial conglomerates show a highly heterogeneous structure. They are
partly insurance-dominated, partly bank-dominated and are active purely nationally, as well as Europe-wide or
worldwide.

In BaFin does not exsist a seperate unit for the supervision of financial groups conglomerates. In fact the
supervision of these institutions takes place in the banking and insurance departments, depending on the group
or conglomerate that has to be supervised. To ensure a consistent supervision, internal guidelines have been
The HFSA identified only one conglomerate in terms of 2002/ 87 /EC directive on financial conglomerates.
However, number of large and complex institutions with significant systemic risk is much higher than one. These
institutions were identified and their supervision was concentrated into one organisational unit, the Department for
Supervision of Financial Groups. Each financial group has a group-supervisor, that is, a relationship manager.
Subsidiaries of these large and complex institutions are supervised also by this Department. This resulted in the
fact that colleagues at the Department are experts from different areas, such as banking, investment, insurance,
etc. Pension funds belonging to these groups are not supervised by this Department it remained at the
competence centre, that is, at the Department for supervision of pension funds.
By the time being supervision of financial groups focus on intra-group relationships, especially corporate
governance, internal audit and compliance issues as well as risk-transfers within the groups. As a result of due
date of introduction of the new Basel capital regulation, and ongoing Solvency II (only in the EU) for the insurance
sector, preparation for implementation of these new rules by the supervised institutions is in the focus of
Until recently we have not had any financial groups. There is a newly founded financial group on the insurance
market. A specific supervision of the group has not been organised.
At present, the Financial Regulator does not have a separate unit with responsibility for the supervision of
financial groups/conglomerates.
The FSA has a separate unit named Financial Conglomerate Office in the supervisory bureau. And, „The
Guideline for Supervision on Financial Conglomerates” has been established in June 2005, which describes
evaluation point for Financial Conglomerates Supervision.
 for Financial Conglomerates Supervision.
vision.

Note)
<Evaluation Points for Financial Conglomerates Supervision>
Management
Financial Soundness
- Capital Adequacy
- Risk Management System (Credit Risk, Market Risk, Liquidity Risk)

Operational Appropriateness
- Compliance System
 - Appropriateness of Intra-group Transactions
 - Operational Risk Management System
 - System Risk Management System
 - Crisis Management System
nt System
 - Capital Increase
 - Protection of Customer Information


There is a separate team that supervises financial conglomerates, while relevant supervision and examination
departments handle each subsidiary of the conglomerate. (For example, when the subsidiary is a bank, the Bank
Supervision Department and Bank Examination Department are responsible for its supervision.)
The main objectives of financial conglomerate supervision are:



By doing so, we try to improve the soundness of the financial conglomerates.




The supervision of the local banks and their insurance and securities arms are brought together under the
Complex Institutions Supervision Department (CI). As home supervisor of the local banking groups, CI takes an
integrated supervisory approach, evaluating them a whole-of-group basis across their banking, insurance and
capital markets activities. Supervision of the local banking groups is also on a consolidated basis, taking into
account both their Singapore and overseas operations.
The Specialist Risk Supervision Department provides financial risk and technology risk expertise in support of the
supervisory departments, including CI. Where necessary, CI will also draw upon the resource and expertise of
supervisors from banking, insurance and capital markets.
  Australia (APRA)


   Austria (FMA)


  Belgium (CBFA)
   Canada (OSFI)
Denmark (Danish FSA)




  Germany (BaFin)




   Hungary (FSA)




    Iceland (FME)
   Ireland (IFSRA)
     Japan (FSA)
     Korea (FSS)




 Netherlands (DNB)
Norway (Kredittilsynet)
    Sweden (FI)




   Singapore (MAS)




United Kingdom (FSA)
Please, explain any major events not mentioned above which affect your authority since
the last FSC Meeting (change in the supervised sectors, in the power/scope of
supervision, major changes in regulation, restructuring of the authority, etc.).


No major events apart from a proposed change, outlined in Part II Question 2, for APRA to become subject to the
FMA Act.

The FMA installed a separate Task Force which is responsible for taking actions against unauthorised business
activities. The FMA obtained additional legal competences to execute the task, particularly gathering of information
and on-site inspections. The Task Force works in close cooperation with the securities supervising department and
began its operational activities in March 2006. Cooperation with the public prosecution and the courts is foreseen.




Establishment of a department INT (International Policy/Affairs)

Department INT (International Policy/Affairs) was established on 4 November 2005. BaFin‟s primary international
activities, with the exception of a few specialised areas, are brought together in this department. Other sections
operating at international level but not integrated into the organisational structure of Department INT will be closely
linked to it as far as procedures and actions are concerned.

Up till now, BaFin‟s international functions were performed by seven sections allocated to three directorates and
Department Q 1. The new Department INT comprises only six sections. By combining the international functions in a
single department, the section responsible for co-ordination has become dispensable.

Section INT 1 is responsible for technical co-operation, i.e. for supporting and advising other supervisory authorities.
Section INT 2 deals with all cross-sectoral multilateral functions and is therefore in a position to not only observe and
study internationally important developments but to take an active role in shaping them. Section INT 3 comprises
BaFin‟s bilateral international functions in order to maintain and expand the existing network with other supervisory
authorities.

Sections INT 4, INT 5, and INT 6 are responsible for sector-specific and multilateral panels and committees. These
Based on the experiences of an almost two years period of operation in board-structure, the HFSA was restructured
in March 2006. Main objectives of this restructuring were

benefits from synergies established in an integrated supervisor



risk-based supervision – in the organisational structure and

risk assessment and analysis of market developments.

Act No. 30/2004, on Insurance Contracts came into effect on 1 January 2006.
One of our top priorities as the financial regulator is to transform our supervision regime into a risk-based one.
Accordingly, we introduced the "Relationship Manager" system last year, under which a relationship manager is
assigned to each financial institution. To ensure efficient supervision, support from a group of experts on diverse
types of risk is always available to our relationship managers.
We also established the Macro-Prudential Supervision Department last year to monitor possible risks arising out of
changes at a macroeconomic level. They built early warning systems for each financial sector to predict the potential
distresses that financial institutions might face. These systems have been in operation for more than half a year.
Korea's financial regulators also introduced the "No-Action Letter" system last July. This system is designed to help
financial companies avoid regulatory uncertainty when entering a new business or introducing a new product.




Corporate Governance Regulations and Guidelines for Banks and Direct Insurers,
MAS issued Corporate Governance Regulations and Guidelines on Corporate Governance to locally incorporated
banks, financial holding companies and direct insurers on 8 September 2005. The Banking (Corporate Governance)
Regulations and the Insurance (Corporate Governance) Regulations, which are mandatory, form the minimum
corporate governance standards required of financial institutions. The Regulations include requirements on the:
• composition of the Board of Directors;
• establishment, composition and responsibilities of various board committees; and
• separation of roles for the Chairman of the Board and Chief Executive Officer.

Banks and direct insurers are also strongly encouraged to adopt best practices on the roles and responsibilities of
board and management, risk management and internal controls contained in the Guidelines on Corporate
Governance, which are adopted from the Code of Corporate Governance issued by the Council of Corporate
Disclosure and Governance.

Corporate Governance Regulations for Approved Exchanges,
Designated Clearing Houses and Approved Holding Companies
MAS also issued the Securities and Futures (Corporate Governance of Approved Exchanges, Designated Clearing
Houses and Approved Holding Companies) Regulations on 29 November 2005. The Regulations, modeled on those
for banks and significant insurers, will apply to the Singapore Exchange Limited (SGX) group of companies.4 The
main difference between the two sets of Regulations is the need to take into account SGX's distinctive regulatory role
over its members. The definition of director independence has therefore been widened to include independence
from members in addition to independence from business and management relationships.

Regulations for Islamic Finance
Following a review and industry consultation, MAS has opted to regulate Islamic banking under the existing banking
regulatory framework as many of the supervisory processes and prudential measures are common to both
conventional and Islamic banking activities. In September 2005, MAS fine-tuned banking regulations so that banks
in Singapore can offer Murabaha financing, where the bank purchases the goods upon the request of a customer
and on-sells them to the customer at an agreed profit margin, with payment being made on a deferred basis.

Deposit Insurance Scheme
Following the enactment of the Deposit Insurance Act in September 2005, the deposit insurance scheme
commenced on 1 April 2006 and will compensate individuals and charities for the first $20,000 of their Singapore

				
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