Question

1. Which of the followings is not an example of an authorised deposit-taking institution (ADI)?

Select one

A. Superannuation fund

B. Credit Union

C. None of the above

D. Building society

2. The primary regulator of the commercial banks, credit unions, and building societies in Australia is

A. The Australian Securities and Investments Commission

B. The Reserve Bank of Australia

C. The Federal Treasury

D. The Australian Prudential Regulation Authority

Answer 1

1. Answer is A. Superannuation fund

Non-banking financial institutions such as Credit union & Building Society are examples of Authorised Deposit Institutions that can conduct the business of accepting deposits from the public after approval of the Australian Prudential Regulation Authority (APRA). Superannuation funds are not, as they are just funds set up to provide retirement benefits and does not involve the business of accepting deposits from public.

2. Answer is A. The Australian Securities and Investments Commission

The primary regulator of the commercial banks, credit unions, and building societies in Australia is the Australian Securities and Investments Commission (ASIC) which oversees the financial markets and ensures consumer protection.

The Australian Prudential Regulation Authority (APRA) on the other hand, is a secondary and prudential regulator looking into stability of the financial system apart from consumer protection.

The Reserve Bank of Australia is responsible for monetory policy and overall stability. It is also responsible for payment clearance and settlement system between other banks.

The Federal Treasury is concerned with fiscal and economic policy at the macro level and its execution at the micro levels. It is also responsible for the budget.