ASX Announcement - APRA Report into Irregular Currency Options Trading at the National - 24 March 2004

Download the full APRA Report (PDF - 600k)

The National today released a report by the Australian Prudential Regulation Authority (APRA) into irregular currency options trading at the bank.

The National's Chairman, Mr Graham Kraehe, and Chief Executive, Mr John Stewart, also outlined the bank's response to the APRA report and its proposed remedial actions.

Mr Kraehe said the Board, following consultation with APRA, had decided to release the entire APRA report and their proposed remedial actions to ensure full disclosure.

"As a matter of policy we do not release correspondence between the National and regulatory authorities," he said.  "However, because of the exceptional circumstances surrounding this issue, we have decided to release the APRA report."
 
Mr Kraehe said the APRA report is consistent with the conclusions in the PricewaterhouseCoopers report released earlier this month.

"The two reports, and the remedial actions proposed by APRA, provide the Board with a clear roadmap to improve key policies and systems within the National," he said. "We fully accept APRA comments about the need for the Board to take a leadership role in transforming the culture and governance processes at the National."

The Chief Executive of the National, Mr John Stewart, said the bank would act as quickly as possible to implement all of the remedial actions proposed by APRA including capital adequacy initiatives to take the National's total capital to 10 per cent.  This will also result in termination of the current share buy-back.

"We have already started to implement a series of actions to enhance our policies and systems," he said. "We will continue to work co-operatively with APRA, and other regulatory authorities, to implement all remedial actions within agreed timelines."

"The first step will be to incorporate the remedial actions proposed by APRA into the four point action plan we announced earlier this month. We will then report regularly to the Board and APRA on implementation of the remedial actions."

For further information:

Brandon Phillips
Corporate Relations Manager
03 8641 3857 work
0419 369 058 mobile