This time last year the prudential regulator was nervously awaiting the release of the HIH Royal Commissioner’s report, but now the Australian Prudential Regulation Authority (APRA) says it has recovered from the results of its past mistakes.

Charles Littrell, APRA’s Executive General Manager Policy, Research and Consulting, said in a speech last week it “would be fair to say that the HIH failure… demonstrated to us that effective prudential supervision must be action-oriented and proactive prudential supervision”.

He says the while the regulator’s staff are “reasonably good at our jobs… like the insurance industry, we can and will improve over time”.

Mr Littrell says APRA will continue to take “a more interventionist approach” to regulating and setting standards, but he says the regulator will never have a flawless record.

“APRA will never be able to guarantee a zero failure regime, and in fact we would do more harm than good if we tried to deliver zero failures.

“Failure rates in the past two years in the prudentially regulated sector have been minimal… I will immodestly suggest also due to improved APRA supervisory efforts.”