Key takeaways
- ASIC’s role is to ensure consumer credit protections are universally applied and enjoyed. Therefore, ongoing work to examine compliance across the sector continues to be a priority.
- Specific areas of focus include mortgage brokers, motor vehicle finance, financial hardship, debt management, credit repair and debt collection.
- As a key enforcement priority, ASIC is closing loopholes that enable business models to avoid consumer credit protections and is closing in on the businesses who seek to exploit them.
- ASIC continues to take action across the spectrum, wherever it sees credit-related misconduct. Entities whose conduct causes harm to consumers – or harm to their financial futures – should expect ASIC to take an active interest.
- ASIC’s concern is with outcomes – not the type of credit, or the type of business involved.
South Africa advances OTC derivatives reform with new exemption framework
Summary
South Africa’s twin-peak regulators (the FSCA and PA) have issued Joint Standard 1 of 2025, advancing Phase 2 of OTC derivatives reform. The standard allows recognised foreign CCPs and trade repositories, mainly from equivalent jurisdictions (EU, UK, US), to apply for exemptions from local FMA licensing, avoiding duplicate regulation. It builds South Africa’s central clearing framework, balancing market access with systemic-risk oversight.
Purpose
- Provides the framework to allow foreign market infrastructures from equivalent jurisdictions (e.g., EU, UK, US) to be exempted from domestic licensing and regulatory requirements.
- The standard is a key step in Phase 2 of the Joint Roadmap for Central Clearing, complementing the broader equivalence framework and licensing regime for both local and external CCPs and TRs.
Insights from the Consultation Report
The Consultation Report (August 2025) provides transparency on the feedback process and regulator responses, from organisations such as BASA, JSE, and SAIS.
Main Issues Raised
- Fairness to local entities: Stakeholders questioned whether foreign CCPs/TRs could operate on lighter terms than domestic ones.
- The FSCA/PA clarified that foreign entities face equivalent or stricter requirements, as exemptions only apply after formal equivalence assessments and compliance with international standards.
- Local presence concerns: Some advocated that external CCPs/TRs maintain a South African legal presence to mitigate systemic risk.
- The Authorities disagreed that this should be a blanket requirement but noted they could impose local presence conditions on a case-by-case basis.
- Systemic risk and oversight: JSE and SAIS raised concerns about loss of supervisory control, regulatory arbitrage, and data privacy.
- The regulators emphasized that MOUs and continuous monitoring mechanisms under the FMA will ensure cooperation, data exchange, and oversight parity.
- Timing and coordination: Some argued the framework was premature given pending reforms under the proposed COFI Bill and the FMA Review.
- The regulators responded that this Joint Standard was a G20-mandated prerequisite and part of a phased rollout of South Africa’s central clearing regime.
- Market fragmentation: Concerns that multiple CCPs might fragment liquidity or create unequal competition.
- The regulators replied that competition could instead enhance efficiency and reduce concentration risk, provided consistent regulation is applied.
The RBNZ opens a consultation on the use of the word ‘bank’ under the Deposit Takers Act 2023 (DTA)
The consultation paper proposes expanding the use of the word ‘bank’ to all deposit takers that become licensed under the DTA. This could include entities that are currently licensed as non-bank deposit takers (NBDTs).
Background
- The DTA modernises New Zealand’s regulatory framework for deposit takers. The DTA will replace existing prudential legislation with a single regulatory regime for all deposit takers.
- Its standards are expected to come into effect on 1 December 2028.
- The Reserve Bank of New Zealand (Reserve Bank) has the power to authorise persons to use a restricted word in their name or title. Restricting the use of the word ‘bank’ is a standard feature of prudential regulation for deposit taking activity internationally.
- The paper seeks feedback on:
- a proposal to authorise the use of the term ‘bank’ by all licensed deposit takers under the DTA
- continuing our current approach to authorising the use of the word ‘bank’ in New Zealand for overseas banks not licensed by the Reserve Bank.
- Proposals for a second tranche of DTA regulations have been released for consultation alongside the consultation paper. These include proposed regulations that will affect the ‘perimeter’ of the DTA, which determines the types of entities that can become licensed deposit takers and therefore, subject to final policy decisions, potentially be authorised to use a restricted word in their name.
Next steps
Submissions will close at 5PM on 24 November 2025. Final decisions are expected to be announced in early 2026.
Canadian Superintendent outlines priorities for financial regulation
Canadian Superintendent of Financial Institutions (OSFI) Peter Routledge gave a speech highlighting the resilience of Canada’s financial system as evidenced by significant capital buffers while emphasising the role OFSI plays to promote innovation and ease burdens in the Canadian market.
Context
The speech comes as OSFI continues to recalibrate its regulatory approach post-pandemic, balancing resilience with competitiveness. Routledge stated that Canada has not had a deposit-taking institutional fail since 1996 while the U.S. banking system has absorbed over 500 failures in the same period, giving OFSI room to adjust its risk appetite.
Key takeaways
- Resilience: Canadian banks’ CET1 ratios average 13.7%, leaving ~$500bn in lending headroom before breaching capital minimums; insurers’ core capital ratios are up 13% in six years.
- Proactive Supervision: OSFI will continue modernizing its framework, rescinding outdated guidelines, adjusting risk-weightings, and consulting on capital treatment of certain loans to support business lending.
- Competitive Balance: OSFI paused increases in the Basel III output floor earlier in 2025 to aid international competitiveness and announced a reduction in capital requirements for Canadian infrastructure debt and equity investments made by OFSI-regulated life insurers.
- Innovation and Market Entry: OSFI will revamp its approvals process to ease entry for new banks and support digital innovation (e.g., stablecoins, distributed ledger products) under the principle of “same activity, same risk, same rules.”
Next steps
OFSI will provide further details in November 2025 on easing burdens for smaller institutions.
- OSFI will consult on the capital treatment of certain loans to encourage business lending by banks.
- A streamlined approvals process for new banking entrants will be developed, alongside a risk-based framework for digital financial innovations.
