Payments System Board Annual Report – 2008 Engagement with Industry

Liaison with Industry

Over 2007/08, the Bank continued its practice of consulting with industry participants on a range of topics. Discussions primarily focused on the review of the payments system reforms, the account switching project, ATM reforms, and the review of settlement practices in the Australian equities market. In addition, the Bank also liaised closely with Treasury, the Australian Securities and Investments Commission (ASIC) and the Australian Competition and Consumer Commission (ACCC) on a number of issues.

The review of the payments system reforms has represented a significant liaison effort by the Bank. As discussed above, in addition to its customary bilateral consultations, the Bank hosted a conference in November 2007 to which 90 interested parties including financial institutions, merchants, schemes and academics were invited.

The Bank has also consulted widely over the past year on issues related to the Australian equities market. It has had regular meetings with ASX management on matters related to the compliance of ASX-owned entities with the Financial Stability Standards. In addition, the Bank has commenced a program of liaison with market participants, including participants in the securities lending market.

Last year's Annual Report described new liaison arrangements between the Bank and the Australian Payments Clearing Association (APCA). As part of these new arrangements, over 2007/08, the Bank met with APCA management after each APCA Board meeting to discuss developments – eight meetings in total – and met with the APCA Board on one occasion. Bank staff also met with APCA throughout the year to discuss account switching, ATM reform and the development of APCA's access code, and possibilities for ‘self governance’ of the payments system.

Staff have also made a number of presentations over 2007/08 covering the review of the payments system reforms and payments system issues more broadly. The Deputy Chairman of the Board addressed a Visa forum on ‘The Preliminary Conclusions of the Payments System Review’ in June 2008 and the Head of Payments Policy Department gave presentations on the Review to Banktech07, Cards and Payments Australasia 2008 and the Australian Smart Cards Summit 2008, as well as more general presentations on the payments system to Indue's Church Funds and Charities Summit 2007 and the Commonwealth Bank's major merchant forums for 2008.

International Meetings

The Bank continues to be represented on two international groups dealing with payments system issues: the Committee for Payment and Settlement Systems Subgroup on Foreign Exchange Settlement Risk (FXSR subgroup) and the EMEAP Working Group on Payment and Settlement Systems.

As discussed in the chapter on ‘Ongoing Regulatory Responsibilities’, the FXSR subgroup is currently responsible for oversight of CLS Bank, and held three meetings over 2007/08. Its main focus this year has been on developing new arrangements for the joint oversight of CLS Bank and finalising the survey of foreign exchange settlement risk (which was published in May 2008). The EMEAP Working Group held two meetings in 2007/08 – the first in Korea in October 2007 and the second in Thailand in March 2008. Over the past year, this group's main focus has been payments system resilience.