Document ID: chunk:federal_register_of_legislation:F2023L01384:body:0:p5
Version: federal_register_of_legislation:F2023L01384
Segment Type: other
Provision Reference: 
Character Range: 11531–14923

execution risks; and
(d)          pre-positioning measures required to effectively execute the option.
22.         APRA may require an APRA-regulated entity to have the resolvability assessment independently reviewed.

Pre-positioning plan
23.         APRA may require an APRA-regulated entity to develop and implement a pre-positioning plan to remove barriers to the execution of resolution options and mitigate execution risks.
24.         The pre-positioning plan must include, where applicable:
(a)          changes to organisational or legal structure, including the location of any shared services within a group;
(b)          renegotiation of contracts, including with third-party service providers;
(c)          development of wind-down or run-off plans for particular businesses or assets;
(d)          measures to ensure the operational continuity of key functions and services during resolution;
(e)          capabilities necessary to support APRA in effecting the resolution options; and
(f)           any other actions required to remove barriers to the execution of resolution options or mitigate execution risks.
25.         APRA may require an APRA-regulated entity to implement additional pre-positioning actions if necessary to support the resolution plan.

Financial resources and loss-absorbing capacity
26.         An APRA-regulated entity must maintain the financial resources required to support the resolution plan.
27.         APRA may require an APRA-regulated entity that is not an RSE licensee to maintain an amount of loss-absorbing capacity to support the resolution plan:
(a)          for an ADI, APRA may adjust its Total Capital prudential capital requirement under Prudential Standard APS 110 Capital Adequacy; and
(b)          for a general insurer, life company or private health insurer, APRA may adjust its prudential capital requirement under Prudential Standard GPS 110 Capital Adequacy or Prudential Standard LPS 110 Capital Adequacy, or a capital adequacy supervisory adjustment under Prudential Standard HPS 110 Capital Adequacy.

Capabilities for resolution
28.         An APRA-regulated entity must establish and maintain the capabilities required to support the resolution plan. These include:
(a)          resolution governance arrangements;
(b)          operational capabilities;
(c)          financial management;
(d)          data and systems; and
(e)          where appropriate, a restructuring plan.
29.         APRA may require an APRA-regulated entity to establish and maintain additional capabilities if necessary to support the resolution plan.
30.         APRA may adjust the prudential requirements of an APRA-regulated entity where barriers to resolution are not addressed or where capabilities to support the resolution plan are insufficient, including changes to capital requirements where relevant.

External advisors
31.         APRA may require an APRA-regulated entity to:
(a)          engage, at the expense of the APRA-regulated entity, expert external advisors approved by APRA, to support with any aspect of this Prudential Standard. An APRA-regulated entity must consult with APRA before finalising the terms of engagement, and must ensure that external advisors are available to meet with APRA on request. Reports prepared by external advisors must be provided to APRA and the APRA-regulated entity, including any interim