The Australian Prudential Regulation Authority will impose an additional A$250 million capital requirement to Allianz Australia Ltd. due to its heightened operational risk.
The regulator asked 36 banks, insurers and superannuation licensees to undertake a self-assessment in 2018 to gauge if the weaknesses it found through its inquiry into the Commonwealth Bank of Australia also existed in other institutions.
The regulator's analysis of the self-assessment confirmed that many of the issues it found were not unique to the Commonwealth Bank of Australia, which included a need to strengthen the non-financial risk management and to enhance their risk culture. The companies also need to ensure that accountabilities are clear, cascaded and enforced, according to APRA's report.
APRA said that the requirement of an additional A$250 million capital for Allianz Australia will remain until the company has completed its underway remediation work, which is intended to strengthen the insurer's risk management and close the gaps its self-assessment had identified.
The regulator has previously proposed additional capital requirements for Australia & New Zealand Banking Group Ltd., National Australia Bank Ltd. and Westpac Banking Corp.