Document ID: chunk:federal_register_of_legislation:F2023L01380:body:0:p6
Version: federal_register_of_legislation:F2023L01380
Segment Type: other
Provision Reference: 
Character Range: 13945–16742

and exit plan, in advance of recovery or exit actions being required. This must take into consideration potential legal, financial, operational and structural requirements for executing recovery or exit actions.
26.         An APRA-regulated entity must maintain access to sufficient financial resources to support the implementation of recovery and exit actions included in the recovery and exit plan.
27.         An APRA-regulated entity must regularly monitor the indicators of stress that would be used to trigger activation of the recovery and exit plan or the specific actions within it.

Testing and review
28.         Unless APRA determines otherwise, an APRA-regulated entity must review and update its recovery and exit plan:
(a)          for an SFI, at least annually; and
(b)          for a non-SFI, at least every three years.
29.         An APRA-regulated entity must review and update its recovery and exit plan to reflect any significant changes in legal or organisational structure, business mix, strategy or risk profile.
30.         An SFI must undertake a comprehensive review at least every three years of the effectiveness of the recovery and exit plan and its readiness and capabilities to execute it. The comprehensive review must be conducted by operationally independent, appropriately experienced and competent persons.
31.         As part of the comprehensive review, an SFI must conduct operational testing to simulate the use of the recovery and exit plan. This must involve a test of the governance arrangements, communication plan, operational elements of key actions, and internal reporting.

Notification
32.         An APRA-regulated entity must provide a copy of the recovery and exit plan to APRA following each review, within three months of the recovery and exit plan being approved by the Board.
33.         An APRA-regulated entity must notify APRA if it has activated its recovery and exit plan.
[1]  For the purposes of this Prudential Standard, an RSE licensee has the meaning given in subsection 10(1) of the SIS Act. An RSE licensee's business operations includes all activities of an RSE licensee (including the activities of each RSE of which it is the licensee), and all other activities of the RSE licensee to the extent that they are relevant to, or may impact on, its activities as an RSE licensee.
[2]  This power is to be exercised under s11AF (1)(d) or (e) of the Banking Act.
[3]  This power is to be exercised under paragraph 12 of this Prudential Standard.
[4] APS 001, GPS 001, LPS 001 and HPS 001 define the terms SFI and non-SFI in relation to other APRA-regulated entities.
[5]  Head of a group means a Level 2 Head or a Level 3 Head as relevant. Level 2 Head means: where an ADI that is a member of a Level 2 group is not a subsidiary