Australian Covered Bonds - Australia

1	What type of assets may be included in the cover pool?
	Primary assets Substitution assets Public sector assets Mortgage assets Other 1* Other 2* Other 3*
2	What is the geographical scope of assets?
	Primary assets Substitution assets Public sector assets Mortgage assets Other 1* Other 2* Other 3*
3	Is there a maximum level for substitute assets in the statutory national framework?	Yes, please specifiy
4	Are there any reporting requirements for covered bond issuers to investors?	Yes, contractual obligations
5	What is the frequency of reporting to investors?	Monthly

1	What is the basis for property valuation	No explicit provision in applicable legislation
2	Is a regular update of the property value required?
3	What are the LTV limits (single asset based)? Please specify in %/n.a.
4	Are loans in excess of LTV limits eligible for inclusion in the cover pool?	Yes (soft limit)

IV.1 Derivative contracts in the cover pool

1	Are derivative contracts eligible for the inclusion in the cover pool?	Yes, exclusively for hedging purposes (by law)
2	Are there requirements for derivative contracts (e.g. eligibility criteria for hedging counterparties)?
3	Will derivative contracts remain in case of insolvency of the issuer?
4	If derivatives are permitted in the cover pool, what is their ranking?

IV.2 Exposure to market risk

1	What is the primary method for the mitigation of market risk?
2	Are there mitigating provisions for interest rate risk?
3	Are there mitigating provisions for foreign exchange risk?
4	Are there mitigating provisions for maturity mismatch risk?
5	What type of coverage test is applied?
6	Are there stress scenarios applied?

IV.3 Liquidity risk

1	Is exposure to liquidity risk mitigated?
2	What liquidity risk mitigation requirements are in place (principal)?
3	What liquidity risk mitigation requirements are in place (interest)?
4	What is the consequence of not fixing a breach of liquidity risk mitigants?
5	If 180 days liquidity provisions are in place, what types of liquid assets are eligible
6	If 180 days liquidity provisions are in place, the calculation of principal is based on:

IV.4. Maturity extension

1	Is maturity extension allowed by national law?	Yes but optional
2	Is it possible to issue…
3	Which trigger plays a role for maturity extension according to law - independent or alone or in combination?
4	Does any competent authority need to give its okay (or non-opposition)?

IV.5 Overcollateralisation

1

Is mandatory overcollateralisation required in the law ?

V.1 Cover pool monitor (CPM)

1	Is there a cover pool monitor in addition to national competent authorities in the statutory law?	Yes, by law
2	Is the CPM separate from the issuing credit institution?	Yes, required by national statutory law
3	Is the appointment, dismissal, eligibility criteria and the role of the CPM regulated by the national statutory law?	Yes

V.2 Banking supervision

1	Which are the national competent authorities designated to carry out covered bonds public supervision in the law?	Australian Prudential Regulation Authority (APRA) - Website
2	Is a special permission required for a covered bond programme according to national law?	Others, please specify
3	Is there a covered bond issuance limit in law or regulation? If yes, please specify	Yes
4	Does the national statutory law provide for the appointment of a dedicated cover pool administrator in case of insolvency/resolution (transfer included acc. to BRRD [Bank Recovery and Resolution Directive])?
5	Which is the typical frequency in the national statutory law of reporting from the covered bond issuers to the designated competent authorities?	No, but there is a market practice

1	Does the national statutory law meet the requirements laid down in the EU Covered Bond Directive?	No
2	Does the statutory law meet the requirements of Article 129 of CRR [Capital Requirement Regulation]? In this case, please specify the collateral types meeting the Art. 129 CRR.	No Not relevant for non-EEA covered bonds including Australian covered bonds.
3	Does the statutory law allow covered bonds out of the scope of Art 129 of CRR? In this case, please specify the collateral	Yes Not relevant for non-EEA covered bonds including Australian covered bonds.
4	Are listed covered bonds eligible in repo transactions with the national central bank?	Yes

Fact Book

• 3.2 Australia.pdf (English language)

Any further comments/information?