APRA scales back additional liquidity buffers after risk control remediation
The Australian Prudential Regulation Authority (APRA) has scaled back certain liquidity add-on requirements imposed on Macquarie Bank in 2021 and 2022, following improvements to the bank’s risk controls and reporting.
APRA originally applied the measures after identifying material breaches that exposed weaknesses in Macquarie Bank’s liquidity risk framework and operational risk management.
In April 2021, the regulator directed Macquarie to lift its net cash outflow (NCO) overlay by 15% within the liquidity coverage ratio (LCR) calculation and to reduce available stable funding (ASF) by 1% in the net stable funding ratio (NSFR) calculation. At the same time, APRA agreed a remediation program with the bank to address the control gaps.
Subsequently, further errors were found in NCO calculations, again tied to deficiencies in controls. In response, APRA increased the NCO overlay by another 10% in April 2022, taking the total overlay to 25%.
After a detailed supervisory review, including a Financial Accountability Regime attestation from Macquarie Bank on the status of its remediation and independent assurance over the work completed, APRA has concluded that elements of the bank’s liquidity risk management and reporting controls affecting NCO and ASF calculations have been remediated to a level that allows a partial unwind of the add-ons. As a result, the NCO add-on has been reduced to 15%, while the ASF adjustment has been removed. The changes apply with immediate effect.
The remaining NCO add-ons will stay in force until APRA is satisfied that all outstanding remediation actions are completed and embedded. The decision does not affect the separate $500 million operational risk capital overlay, which is linked to its own remediation program and remains unchanged.
The easing of the liquidity add-ons comes as Macquarie continues to lift its presence in the Australian mortgage market. The bank has been expanding its housing loan portfolio in recent years, supported by a broker-led distribution strategy and significant investment in digital banking platforms and loan-processing technology.
On an annual basis, Macquarie’s home loan book grew by nearly 24% in the year to November 2025, adding about $31 billion over the period.
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
