The Council of Financial Regulators (CFR) is the coordinating body for Australia’s main financial regulatory agencies. There are four members – the Australian Prudential Regulation Authority (APRA), the Australian Securities and Investments Commission (ASIC), the Reserve Bank of Australia (RBA) and The Treasury. The Reserve Bank Governor chairs the CFR and the RBA provides secretariat support.

The CFR is a non-statutory body. That is, it has no legislative backing and as a consequence has no formal regulatory or policy decision-making powers. Those powers rest with its members under their respective acts. Instead, the CFR operates as a means for cooperation and coordination among member agencies.

The CFR's objectives, as set out in its Charter, are to promote stability of the Australian financial system and to contribute to the efficiency and effectiveness of financial regulation. The members achieve this by:

  • sharing information and views on financial sector conditions and risks
  • discussing regulatory initiatives and the regulatory framework, including in recent years the application of international regulatory reforms
  • providing advice to the government on regulatory matters and the suitability of Australia's financial system regulatory arrangements
  • if the need arises, coordinating responses to potential threats to financial stability.

The CFR's focus on cooperation and coordination is supported by multiple Memorandums of Understanding (MoUs) and bilateral coordination arrangements between member agencies. The MoUs cover such matters as information sharing, prompt notification of any regulatory decisions likely to impact other agencies’ responsibilities, and consultation arrangements in the event of financial disturbances. Given the CFR’s central role in crisis management, a specific MoU on financial distress management was agreed by the CFR members in 2008. Close cooperation between CFR agencies is complemented by overlapping representation on relevant governance committees: the APRA Chairman currently represents APRA on the Payments System Board of the RBA; and the Secretary to the Treasury is a member of the RBA Board.

Given the important financial linkages between Australia and New Zealand, the Council of Financial Regulators (CFR) places considerable importance on the effective coordination of trans-Tasman crisis resolution and planning arrangements. This coordination is achieved through the Trans-Tasman Council on Banking Supervision (TTBC).