Introduction
The monitoring of compliance is underpinned by an annual compliance statement and subsequent verification with each of the Banks. This process provides the Committee and the Banks with information relating to issues and potential areas of improvement.
In addition as issues emerge we will monitor how the industry deals with Code related areas and work with the Banks to better understand the issues.
Annual Compliance Statements
This is the first year that data from the Annual Compliance Statements has been published.Under clause 34 (d) of the Code, Banks lodge with the CCMC an Annual Compliance Statement. In these statements Banks answer questions and provide information about the measures they have in place to ensure compliance with all sections of the Code.
The Annual Compliance Statement process is a significant component of the CCMC monitoring function. The process enables the CCMC to:
- Provide Banks with the opportunity to self report areas of non compliance;
- Form opinions on the overall level of industry compliance (macro view);
- Assess the adequacy of Code compliance frameworks (including training, monitoring, breach identification and remediation); and
- Establish areas for priority attention and follow up.
The annual compliance statement covers the year ended 31 March. The content is in two parts:
Questionnaire
- Describing compliance frameworks and how compliance is achieved for each area of the Code;
Compliance breach summary
- Total breaches (identified internally by the bank, by FOS or by the CCMC).
Significant breaches – more detail is provided on the nature, root cause and remedial actions.
Significant breaches are those typically having large customer impacts and include breaches identified as systemic by the bank or the Financial Ombudsman Service.
The information provided to the CCMC is confidential and treated as such. De-identified industry compliance data is published in the annual report each year by the CCMC.
Recent Changes
The consistency of breach information from subscribing banks has been a concern for the CCMC since reporting began in 2004.
In consultation with the Banks and the Australian Bankers Association we have made major changes to compliance reporting processes over the last two years.
The introduction of more streamlined and targeted reporting has assisted us
- in obtaining more reliable data and building stronger analytical capabilities; and
- to become more evidence based and risk focused in our monitoring approaches.
- Changed data reporting requirements from what has been fragmented and unreliable complaints information to targeted breach reporting, including advice of significant breaches;
- Our emphasis is now on obtaining data that is or should already be available from banks’ existing systems.
On Site Visits
Consultative on-site visits by CCMC staff to all subscriber banks were introduced last year.The main purpose of the visits was to discuss and review the content of the Annual Compliance Statements including; consulting on issues of preparation and interpretation, and matters for further investigation and follow up.