Authority to carry on banking business
Banking Act 1959
I, Keith David Chapman, a delegate of APRA, under subsection 9(3) of the Banking Act 1959 (the Act), GRANT DBS Bank Ltd 46 601 105 373 authority to carry on banking business in Australia.
Under paragraph 9(4)(a) of the Act, I IMPOSE on this Authority the conditions specified in the attached Schedule.
This Authority commences on the date it is signed.
Dated: 1 June 2015
[Signed]
Keith David Chapman Executive General Manager Specialised Institutions Division
Interpretation Document ID: 217892
In this Notice
APRA means the Australian Prudential Regulation Authority.
ADI is short for authorised deposit-taking institution and has the meaning given in subsection 5(1) of the Act.
banking business has the meaning given in subsection 5(1) of the Act.
Note 1
Under subsection 9(4) of the Act, APRA may at any time, by notice in writing served on an ADI,
impose conditions or additional conditions or vary or revoke conditions imposed on its Authority to carry on banking business. The conditions must relate to prudential matters.
Note 2
Under subsection 9(6) of the Act, an ADI is guilty of an offence if it does or fails to do an act and
doing or failing to do that act results in a contravention of a condition of the ADI’s Authority, and there is no order in force under section 11 of the Act determining that subsection 9(6) does not apply to the ADI. The penalty is 200 penalty units or, by virtue of subsection 4B(3) of the Crimes Act 1914 in the case of a body corporate, a penalty of up to 1,000 penalty units. By virtue of subsection 9(6A) of the Act, an offence against subsection 9(6) is an indictable offence. Under subsection 9(6B)of the Act, if an ADI commits an offence
against subsection 9(6), the ADI is guilty of an offence against that subsection in respect of the first day on which the offence is committed and each subsequent day (if any) on which the circumstances that gave rise to the ADI committing the offence continue (including the day of conviction for any such offence or any later day).
Note 3
Under subsection 9(9) of the Act, a decision to impose conditions on this Authority is a decision to
which Part VI of the Act applies. If a person whose interests are affected is dissatisfied with that decision, the person may seek reconsideration of the decision by APRA in accordance with section 51B(1) of the Act. The request for reconsideration must be in writing, must state the reasons for the request, and must be given to APRA within 21 days after the decision first comes to the person’s notice or within such further period as APRA allows. If dissatisfied with APRA’s reconsidered decision confirming or varying the first decision, the person may, subject to the Administrative Appeals Act 1975, apply to the Administrative Appeals Tribunal for review of the reconsidered decision.
The address where written notice may be given to APRA is Level 26, 400 George Street, Sydney NSW 2000.
Note 4
Act.
Note 5
The circumstances in which APRA may revoke an ADI's Authority are set out in section 9A of the
Under subsection 9(3) of the Act, a copy of this Notice must be provided to the ADI. Under
subsection 9(7) of the Act, APRA must publish a copy of this Notice in the Gazette and may cause notice of the grant of the Authority to be published in any other way it considers appropriate.
Schedule - the conditions imposed on the Authority
1. The ADI, as a foreign ADI carrying on banking business in Australia, shall not accept deposits or other funds for amounts which are less than $250,000 from any source other than from:
(i) incorporated entities;
(ii) persons or unincorporated entities that are not residents of Australia;
(iii) its own employees; or
(iv) persons or unincorporated entities with an initial balance with the foreign ADI of at least $250,000.
In this Schedule, foreign ADI has the meaning given in subsection 5(1) of the Act.
Overview
The Banking Act 1959, enacted by the Commonwealth Parliament, governs the regulation of banking activities within Australia. The Act was introduced to establish a robust regulatory framework for banking operations, ensuring the stability and integrity of the financial system. A significant component of this Act is the authority of the Australian Prudential Regulation Authority (APRA) to grant or impose conditions on the authority of authorised deposit-taking institutions (ADIs) to carry out banking business. Keith David Chapman, as a delegate of APRA, has exercised this authority by granting DBS Bank Ltd the authority to conduct banking business in Australia, subject to specified conditions aimed at maintaining prudential standards. The policy objective of these provisions is to safeguard the financial system by ensuring that ADIs adhere to stringent regulatory requirements, thereby protecting depositors and maintaining confidence in the banking sector.
Scope and Application
The Banking Act 1959 applies to authorised deposit-taking institutions (ADIs) in Australia, including DBS Bank Ltd, which has been granted authority to carry on banking business under the Act. The Act provides the Australian Prudential Regulation Authority (APRA) with the power to impose conditions on the Authority granted to ADIs to carry on banking business, and these conditions must relate to prudential matters. APRA may impose, vary, or revoke conditions on the Authority by notice in writing served on the ADI. The Act also provides for offences and penalties for contraventions of the conditions imposed on the Authority. The Act applies to all ADIs in Australia, regardless of whether they are foreign or domestic institutions, and extends to all banking business carried on in Australia. The Act does not provide for any exclusions, exemptions, or thresholds, and its application is not restricted by any subordinate instruments.
Key Provisions
The Banking Act 1959 provides the statutory framework for the regulation of banking entities in Australia. Under this Act, the Australian Prudential Regulation Authority (APRA) has the authority to grant banking licenses to authorised deposit-taking institutions (ADI). Section 9(3) of the Act allows APRA to grant an ADI the authority to carry on banking business in Australia, with the authority subject to conditions that may be imposed under section 9(4). These conditions must be related to prudential matters.
The conditions imposed on DBS Bank Ltd’s authority to carry on banking business in Australia include restrictions on the types of deposits it can accept. Specifically, Section 1 of the Schedule to the Authority Notice states that the ADI, as a foreign ADI, shall not accept deposits or other funds for amounts less than $250,000 from certain sources. This includes deposits from unincorporated entities that are residents of Australia, as well as from its own employees unless the initial balance with the foreign ADI is at least $250,000. These conditions are intended to manage the prudential risks associated with the ADI’s operations in Australia.
Failure to comply with the conditions imposed on the Authority can result in significant legal consequences. Section 9(6) of the Act states that an ADI is guilty of an offence if it does or fails to do an act that results in a contravention of a condition of its Authority, and there is no order in force under section 11 of the Act determining that subsection 9(6) does not apply. The penalty for such an offence is up to 200 penalty units for an individual and up to 1,000 penalty units for a body corporate, with each day of non-compliance constituting a separate offence. This is an indictable offence under the Act, meaning that it can be prosecuted by the Commonwealth Director of Public Prosecutions.
If an entity affected by a decision to impose conditions on its Authority wishes to challenge that decision, they can seek reconsideration by APRA under section 51B(1) of the Act. A written request for reconsideration must be made within 21 days of the decision coming to the entity's notice, or within any further period allowed by APRA. If the entity remains dissatisfied with APRA's reconsidered decision, they can apply to the Administrative Appeals Tribunal for review under the Administrative Appeals Act 1975. These provisions ensure that the ADI has the opportunity to challenge any conditions imposed on its Authority, and to seek review of any adverse decisions.