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APRA’s data analytics evolution: from information to insights

Helen Rowell, Deputy Chair

Katrina Ellis, General Manager Data Transformation

This presentation has been prepared for the Actuaries Institute 2018 Financial Services Forum. The Institute Council wishes it to be understood that opinions put forward herein are not necessarily those of the Institute and the Council

is not responsible for those opinions.

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APRA’s role

OUR ROLE FOR THE AUSTRALIAN COMMUNITY

PROMOTE FINANCIAL SYSTEM STABILITY

FINANCIAL SAFETY

BALANCED WITH EFFICIENCY, COMPETITION, CONTESTABILITY, AND COMPETITIVE NEUTRALITY

FINANCIAL SAFETY

OUR SECONDARY ROLE FOR THE FINANCIAL SECTORSTATISTICAL DATA COLLECTION AGENCY

APRA COLLECTS DATA FOR:APRA, RBA, ABS, ASIC, ATO, DoH, DAWR, BIS

APRA PROVIDES DATA TO: THE PUBLIC, RESEARCHERS, TREASURY, PC, IMF, …

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The changing regulatory landscape

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Data and analytics is an enabler for APRA achieving its strategic vision

Sharpening risk-based supervision

New Risk and Data Analytics Division• Risk Specialists• Statistics• Industry Analysis

Modernised Data and Analytics Capabilities• New data collection tool• Modern enterprise data

warehouse• Data visualisation tools• Documents as data

Integrated approach to data and analytics• Entity-level• Industry-level• Macro-level

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Jul-Dec 2017 Jan-Jun 2018 Jul-Dec 2018 Jan-Jun 2019 Jul-Dec 2019 Jan-Jun 2020

Program

Data Collection

Solution

Enterprise Data

Warehouse

Access to Data

Innovation Centre Lab

Data Transformation Program timeline

Planning Communications and engagement

Data Migration

Planning APRA buildGathering

requirements

External Stakeholder Engagement

Product Selection Industry Implementation

Defining change Reinforcing change

Planning Develop and deliver products Transition

Planning

Build internal analytics community

Transition

Run experiments

Target Op Model

Gather data user needs, reinforce change

Transition

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Our transformation

Looking for data Interpreting data

Hindsight Foresight

Passive consumption Active exploration

Multiple standards One standard

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APRA’s use of data

Entity financial analysisPeer benchmarking

Outlier analysisExceptions reports

Industry overview

Evidence-based policy

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Data stories – entity lensADI mortgages - hypothetical borrower loan serviceabilityAnalytics to support supervisory discussions with ADIs

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Data stories – outlier lensSuperannuation MySuper member outcomesAnalytics to support supervisory resource focus

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Data stories – industry lensLife insurance – changing industry ownershipAnalysis to support supervisory awareness of emerging trends

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Data stories – policy lensADI unquestionably strong capital levels – international peer comparisonsAnalysis to support policy settings with evidence

Major banks’ internationally comparable CET1 ratios against the Basel 75th percentile

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Into the future

REGTECH