AU: APS 110 Capital Adequacy¶


Regulator	APRA
Jurisdiction	AU
Status	live
Applicability	Platform

APRA Prudential Standard APS 110 Capital Adequacy is the primary capital adequacy standard for authorised deposit-taking institutions (ADIs). It sets minimum regulatory capital requirements using the Basel III framework, defines eligible capital instruments, prescribes the Capital Conservation Buffer (CCB), Countercyclical Buffer (CCyB), and D-SIB surcharges, and requires ADIs to maintain an Internal Capital Adequacy Assessment Process (ICAAP). It is the Australian implementation of the Basel III capital framework issued under the Banking Act 1959.

The standard was substantially revised effective January 2023 to implement the final Basel III reforms (colloquially "Basel IV"). Note that NZ minimum capital ratios under the RBNZ capital framework are materially higher than APRA's APS 110 ratios; the NZ position is governed separately under the DTA Capital Standard.

Compliance register¶

This register maps every material obligation under APS 110 to the platform control or institutional process that satisfies it. It is the static traceability layer for the Totara compliance report — dynamic data (module build status, test evidence, control test dates) is overlaid at runtime.

Scope legend¶

Symbol	Meaning
🤖 Automated	Platform enforces or performs the obligation. Primary control mode is GATE, AUTO, CALC, or ALERT. Human action is not required in the normal case.
📊 Evidenced	Platform captures the evidence trail automatically. Human compliance decision sits on top. Primary control mode is LOG.
🏛 Institutional	Obligation is met by a process entirely outside the platform — board governance, treasury, finance. Platform may generate evidence inputs but does not own the process.
N/A	Obligation does not apply to this deployment configuration.

Build legend¶

Symbol	Meaning
✅	Module built and deployed
🔨	Module planned — not yet built (`build_status: Not started`)
❌	Uncontrolled gap — no module attributed

Part 2 — Minimum capital requirements¶

Ref	Obligation	Scope	Policy	Platform controls	Build
Para 12	Maintain CET1 ratio ≥ 4.5% of risk-weighted assets at all times	🤖 Automated	CLQ-001	MOD-033 (CALC) — capital ratios computed from live exposure data; no manual risk weight application	🔨
Para 13	Maintain Tier 1 ratio ≥ 6.0% of RWA	🤖 Automated	CLQ-001	MOD-033 (CALC) — Tier 1 capital ratio is a computed output of the RWA engine, updated continuously	🔨
Para 14	Maintain total capital ratio ≥ 8.0% of RWA	🤖 Automated	CLQ-001	MOD-033 (CALC) — total capital ratio output; MOD-033 (ALERT) — capital breach of minimum CET1 threshold triggers automatic board notification	🔨
Para 17	Capital Conservation Buffer — maintain additional CET1 of 2.5%; constraints on distributions if buffer is breached	🤖 Automated	CLQ-001	MOD-033 (CALC) — CCB headroom calculated continuously and forms part of the RAF dashboard; ALERT raised if CET1 falls within the buffer	🔨
Para 20	Countercyclical Buffer — maintain additional CET1 of 0–3.5% as set by APRA; rate applied to Australian credit exposures	🤖 Automated	CLQ-001	MOD-033 (CALC) — CCyB rate loaded from APRA's published buffer rate; applied to RWA calculation automatically on rate change	🔨
Para 24	D-SIB surcharge — if designated, maintain additional CET1 of up to 4.5%	N/A	—	Not applicable unless APRA formally designates the ADI as a Domestic Systemically Important Bank. Platform is architecturally capable of applying the surcharge via configuration.	—
Para 30	Eligible capital instruments — CET1 must consist of common equity only; AT1 and Tier 2 instruments must meet prescribed terms	🏛 Institutional	CLQ-001	Treasury and legal determine the terms of capital instruments. MOD-033 accepts instrument classifications as configuration inputs — it does not validate legal terms.	—

Part 3 — ICAAP¶

Ref	Obligation	Scope	Policy	Platform controls	Build
Para 35	Maintain an ICAAP covering all material risks; demonstrate capital adequacy under stress	🤖 Automated	CLQ-005	MOD-034 (CALC) — stress testing scenario engine; MOD-033 (CALC) — stressed capital ratio output; MOD-150 (CALC) — RAF dashboard provides the ICAAP evidence base	🔨
Para 37	Board attestation of ICAAP adequacy; submission to APRA on request	🏛 Institutional	CLQ-005	Board signs the ICAAP document. MOD-034 and MOD-033 provide the quantitative inputs; attestation is a board governance act.	—

Part 4 — Reporting¶

Ref	Obligation	Scope	Policy	Platform controls	Build
Para 44	Report capital ratios to APRA on the prescribed schedule (ARS 110 returns)	🤖 Automated	REP-002	MOD-036 (AUTO) — prudential return builder produces ARS 110 capital return from MOD-033 outputs automatically on schedule; MOD-036 (LOG) — every figure traceable to source ledger entry	🔨

Institutional obligations (not platform scope)¶

Obligation	Owner	Platform evidence input
Approval and issuance of eligible capital instruments (shares, AT1, Tier 2 notes)	Board / CFO / Treasury	MOD-033 accepts instrument classifications as inputs; issuance is a legal and treasury act
Board attestation of ICAAP	Board	MOD-034 and MOD-033 provide quantitative inputs to the ICAAP document
Risk Appetite Statement incorporating capital risk appetite	Board / CRO	MOD-150 RAF dashboard displays capital metrics against RAS limits approved by the Board
Dividend and distribution constraints under Capital Conservation Buffer	Board / CFO	MOD-033 ALERT output informs the board of CCB headroom; distribution decisions are board resolutions
APRA engagement and regulatory correspondence	CEO / CFO	MOD-036 produces APRA-submission-ready data; correspondence is institutional

Coverage summary¶

Area	Total obligations	Platform automated 🤖	Platform evidenced 📊	Institutional 🏛	N/A
Minimum capital ratios	5	4	0	1	1 (D-SIB)
ICAAP	2	1	0	1	0
Reporting	1	1	0	0	0
Total	8	6 (75%)	0 (0%)	2 (25%)	1

All attributed modules are currently build_status: Not started. The compliance position will update as modules are built and deployed.

Policy	Title
CLQ-001	Capital Adequacy Policy
CLQ-003	Capital Planning & Stress Testing Policy
CLQ-005	Internal Capital Adequacy Assessment Process (ICAAP) Policy
CLQ-006	Capital Disclosure & Reporting Policy
GOV-002	Risk Appetite Statement Policy
REP-002	Prudential Reporting Policy

Official documentation¶

Policies referencing this standard¶

CLQ-001 — Capital Adequacy Policy
CLQ-003 — Capital Planning & Stress Testing Policy
CLQ-005 — Internal Capital Adequacy Assessment Process (ICAAP) Policy
GOV-002 — Risk Appetite Statement Policy
REP-002 — Prudential Reporting Policy

Compiled 2026-05-22 from source/entities/regulations/au-aps-110.yaml