The integration of financial regulatory authorities – the Australian experience
A paper presented by ASIC Deputy Chairman Jeremy Cooper to Comissão de Valores Mobiliários, 4-5 September 2006, Brazil.
What does our financial landscape look like?
Thank you very much for inviting me to speak today. In this session, I will provide you with an Australian perspective on the integration of financial system regulators.
Australia has a population of only 20.6 million people (less than 0.5% of world population, particularly as it compares to a population of over 186 million in Brazil). Yet our economy is ranked 15th in the world in size and we have over 1,900 entities listed on the Australian Stock Exchange (ASX). The total market capitalisation of listed entities on ASX is approximately US$900 billion and it is ranked 8th in size on the Morgan Stanley Capital International Index of stock exchanges.
Not only do we have a larger than expected share market (ie twice as large as the size of our economy might suggest), but a high proportion of Australians invest in it. Roughly 55% of the Australian adult population own shares either directly or indirectly through collective investment and pension savings vehicles.
Australia also has a very large managed funds industry, amounting to approximately US$625 billion, which is the fourth largest in the world, after the United States, Luxembourg and France and ahead of Japan, Hong Kong and Singapore. This means that, on average, each Australian has approximately US$34,000 invested in managed funds – the highest average figure in the world.
This sets the context for an explanation of how Australia decided to structure its financial regulatory authorities.