APRA Imposes Licence Conditions and AUD $50 Million Capital Add-On on ING Australia for Liquidity Br

Key Takeaways

• APRA has imposed license conditions, a higher minimum liquidity requirement, and an AUD $50 Million operational risk capital add-on on ING Bank Australia Limited after the bank disclosed multi-year miscalculations that overstated its Liquidity Coverage Ratio (LCR).
• Reported LCR was around 160 percent, but the true figure was substantially lower and at times fell below the 100 percent minimum under APS 210.
• The action shows that APRA treats inaccurate prudential reporting as a governance and risk management failure, not a technical error.

Deep Dive

ING Australia notified APRA in July 2026 that it had identified material miscalculations of its liquidity position spanning several years. The bank has since raised its liquidity well above the minimum, and APRA considers it financially resilient. APRA nonetheless called the breaches serious and stressed that they are "not simply a reporting error." Its position is that a bank unable to accurately measure a core financial safeguard has a fundamental weakness in risk management and controls. Compliance teams should expect supervisors to scrutinize the integrity of regulatory calculations and data lineage as closely as the resulting ratios.

The enforcement package has several parts. First, license conditions require ING Australia to commission independent reviews of the causes of the reporting failures and of its broader risk management and governance practices. Second, the bank must develop a comprehensive remediation plan and obtain independent assurance that remediation has been effectively implemented and embedded. Third, APRA has raised the bank's minimum liquidity requirements. Fourth, it has imposed an AUD $50 Million operational risk capital add-on to address heightened operational risk and potential wider weaknesses in prudential reporting. No fixed deadline was given. All measures remain in place until APRA is satisfied the required work is complete, so the duration depends on the quality and pace of remediation.

For compliance professionals at other institutions, the action carries several implications: - Self-identification and prompt notification were part of the sequence here, but they did not prevent significant measures. Multi-year duration and the size of the overstatement appear to have driven the outcome. - Institutions should review the methodology, system logic, data inputs, and change management behind LCR and other prudential returns. This includes the classification of inflows, outflows, and high-quality liquid assets under APS 210. - Controls over regulatory reporting should be tested independently, with clear ownership, reconciliation, and model validation. - Breach identification, escalation, and regulator notification procedures should be confirmed as effective. - Boards and risk committees should receive assurance on the accuracy of prudential reporting, not only on the reported outcomes.

The risk implications reach beyond ING Australia. An operational risk capital add-on tied to reporting weaknesses signals that APRA will use capital tools for control failures even when liquidity is currently adequate. Large institutions with over AUD $100 Billion in assets, such as ING Australia, should expect heightened expectations for governance and internal controls. Institutions should also anticipate possible follow-up supervisory inquiries or thematic reviews of liquidity reporting across the sector. Consequences for ING Australia include higher funding and capital costs, management and remediation burden, and reputational exposure. Peers should consider proactive self-assessments now to reduce the risk of similar findings.

Source: Australian Prudential Regulation Authority