Overview

The Authority to carry on banking business 2021 is a legislative instrument that grants Credit Agricole Corporate and Investment Bank ARBN 654 071 075 the authority to operate as a banking institution in Australia. This instrument was enacted in 2021 under the Banking Act 1959, which addresses the need for regulatory oversight and consumer protection in the banking sector. The instrument was issued by Therese McCarthy Hockey, an Executive Director of the Australian Prudential Regulation Authority (APRA), which is the body responsible for regulating and supervising financial institutions in Australia. The primary objective of this legislation is to impose specific conditions on the authority granted to foreign banking institutions to ensure they operate in a manner that is consistent with the regulatory framework and protects the interests of consumers and the financial system. The conditions imposed on the section 9 authority include restrictions on the acceptance of deposits or other funds from certain sources, such as individuals or unincorporated entities that are not residents of Australia, unless the initial balance is at least $250,000. This measure aims to mitigate potential risks associated with foreign banking operations in Australia and maintain the stability of the financial system. The instrument also outlines the process for requesting reconsideration of APRA's decision and the avenues for appeal in case of dissatisfaction with the outcome.

Scope and Application

The Banking Act 1959 governs the scope and application of the authority granted to Credit Agricole Corporate and Investment Bank, an entity with an ARBN of 654 071 075, to conduct banking business in Australia. Under the authority of the Australian Prudential Regulation Authority (APRA), Credit Agricole Corporate and Investment Bank has been granted a section 9 authority to operate as a foreign authorised deposit-taking institution (ADI) in the Australian market, with specific conditions imposed to regulate its operations. This legislative action ensures that the entity adheres to the regulatory framework established by the Commonwealth to safeguard the stability and integrity of the financial system. The geographic reach of this authority is confined to Australia, where the entity must comply with the stipulated conditions to engage in banking activities. The authority, effective from 4 January 2022, imposes specific conditions such as restrictions on the acceptance of deposits under $250,000 from certain sources, thereby ensuring the bank’s operations are conducted within the prescribed regulatory boundaries. The authority may be subject to further refinement or extension through subordinate instruments as deemed necessary by APRA.

Key Provisions

The Authority to Carry on Banking Business 2021 grants Credit Agricole Corporate and Investment Bank, ARBN 654 071 075, the authority to conduct banking business in Australia under the Banking Act 1959 (sections 9(3) and 9AA(1)(a)). This authority is subject to specific conditions outlined in the schedule attached to the instrument. The granting of this authority and the imposition of conditions is effective from 4 January 2022. The Act imposes certain obligations on Credit Agricole Corporate and Investment Bank, particularly as a foreign authorised deposit-taking institution (ADI). One of the key conditions is that the bank must not accept deposits or other funds for amounts less than $250,000 from sources other than incorporated entities, non-resident persons or unincorporated entities, its own employees, or non-incorporated entities with an initial balance of at least $250,000. This condition is intended to ensure that the bank maintains a certain level of financial stability and risk management. Failure to comply with the conditions imposed under the section 9 authority can result in various legal consequences. Although the specific penalties are not detailed in the text provided, breaches of the Banking Act 1959 can generally lead to both civil and criminal penalties. Civil penalties can include fines, and in severe cases, criminal penalties such as imprisonment may be imposed. The exact penalties would depend on the nature and severity of the breach, as well as any relevant case law and statutory provisions. Credit Agricole Corporate and Investment Bank has the right to request APRA to reconsider the decision to impose conditions on the section 9 authority. Such a request must be made in writing within 21 days of receiving notice of the decision, or within any extended period allowed by APRA. If the bank remains dissatisfied with the outcome of the reconsideration, it may apply to the Administrative Appeals Tribunal for review of the decision. The address for submitting such requests and notices to APRA is Level 12, 1 Martin Place, Sydney NSW 2000.