The Australian Prudential Regulation Authority (APRA) has recently increased its oversight of KeyInvest, a financial services firm renowned for its funeral bond product, by imposing additional licence conditions and raising the capital requirement.
This decision follows an APRA review identifying deficiencies in KeyInvest’s risk management framework and questioning the board's effectiveness in maintaining strategic oversight.
KeyInvest must now meet a new capital requirement of $5.5 million, which will remain until APRA confirms that its concerns have been adequately addressed. Furthermore, the firm is required to develop and implement a remediation plan based on the review's recommendations and establish a board renewal plan approved by APRA.
APRA's Member, Suzanne Smith, emphasised the importance of robust risk management frameworks and urged KeyInvest to prioritise compliance and prudential risk mitigation. Smith stated that the increased capital requirement serves to encourage and expedite the completion of necessary remedial work. Moreover, she reiterated APRA's commitment to protecting policyholders by maintaining a strong prudential framework and actively supervising insurers to ensure their obligations are met.
KeyInvest has acknowledged the review findings and has already begun efforts to act on the recommendations presented by APRA.
The imposition of these conditions on KeyInvest highlights APRA’s rigorous stance on ensuring financial institutions are accountable for their risk management practices. For consumers, this action provides assurance that financial firms are being monitored and held to high standards, thus safeguarding their investments and policy benefits. Businesses in the financial sector are reminded of the critical importance of a sound risk management strategy and the potential repercussions of failing to meet regulatory expectations.
KeyInvest’s progress in meeting APRA’s requirements will be closely watched by the industry. Successful implementation of the required remediation plan could restore confidence in the firm’s governance and risk oversight capabilities. It remains essential for KeyInvest to demonstrate substantial improvements to satisfy APRA's conditions promptly. This situation also serves as a broader warning to other financial institutions to ensure they adhere strictly to prudential regulations to avoid similar scrutiny.
Published:Thursday, 7th Aug 2025 Source: Paige Estritori
Last week, the Reserve Bank of Australia (RBA) made its third rate cut this year, lowering the official cash rate by 0.25% to 3.60%. Historically, such rate reductions have been linked to a significant rise in Australian home values, with double-digit growth expected within two years of the start of a rate-cutting cycle, according to the Australian Financial Review. - read more
In a recent financial disclosure, Bell Financial Group (BFG) announced a notable 44% drop in half-year net profit after tax as it navigates challenging market conditions. While the company's overall revenue declined by 12.5% to $121.5 million, its Technology & Platforms and Products & Services units showed resilience with a combined revenue increase of 12% to $46.3 million. This contrasts sharply with the 23.5% revenue dip in its broking division, which totalled $69.4 million. - read more
The evolving landscape of private credit funds in Australia necessitates greater responsibility from self-directed investors, according to Darren Connolly, the Chief Executive of Investment Markets. As the landscape of fixed income investments becomes increasingly complex, investors are being urged to take ownership of their decision-making processes. - read more
The Reserve Bank of Australia (RBA) recently made a pivotal decision to cut the official cash rate (OCR) by 0.25%, bringing it down to 3.60%. This move marks a total reduction of 0.75% from its peak of 4.35%. Economists and financial markets anticipate further cuts, potentially two more by mid-2026, reflecting a cautious easing policy by the RBA. - read more
As financial planners await forthcoming updates to the Delivering Better Financial Outcomes (DBFO) legislation, many are grappling with significant challenges arising from the first tranche, specifically concerning fee consent requirements. These issues, unfortunately, seem to require legislative amendments as they fall outside the scope of regulatory fixes, amplifying the compliance burden on financial advisers, especially regarding breach reporting. - read more
Managing debt is a crucial aspect of maintaining financial well-being, yet it can often feel like a daunting task. Understanding how debt works and its potential impact on your life is the first step toward gaining control of your finances. In this section, we will delve into the intricacies of debt and outline why a solid financial strategy is essential for effective debt management. - read more
In light of the current economic challenges facing many Australians, managing credit card debt has become more crucial than ever. With rising living costs and financial uncertainty, accruing debt on high-interest credit cards can quickly escalate from a manageable inconvenience to a stressful financial burden. - read more
Welcome, readers! We're here to talk about something incredibly important yet often overlooked: improving your credit score. Your credit score is a financial report card used to evaluate your creditworthiness, and it can have a significant impact on your ability to secure loans, mortgages, and even rental agreements. - read more
