Authority to carry on banking business
Banking Act 1959
I, Keith Chapman, a delegate of APRA, under subsection 9(3) of the Banking Act 1959 (the Act), GRANT E.SUN Commercial Bank, Ltd. ABN 60 606 234 879 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 11 April 2016
[Signed]
Keith Chapman
Executive General Manager Specialised Institutions Division
Interpretation Document ID: 221661
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 was enacted by the Commonwealth Parliament to regulate and supervise the banking industry in Australia. This legislation aimed to address the need for a robust regulatory framework to ensure the stability and integrity of the banking sector. The Act provides the Australian Prudential Regulation Authority (APRA) with the authority to grant and impose conditions on the authority of authorised deposit-taking institutions (ADIs) to carry on banking business. The policy objective of the Act is to safeguard the financial system and protect depositors by promoting the safety and soundness of ADIs. This legislative instrument, issued by Keith Chapman, a delegate of APRA, grants E.SUN Commercial Bank, Ltd. the authority to conduct banking business in Australia, subject to specific conditions that relate to prudential matters. The attached Schedule outlines the conditions imposed on this authority, which include restrictions on the acceptance of deposits from certain sources to mitigate potential risks. This regulatory approach ensures that ADIs operate within a framework designed to preserve financial stability and protect consumers.
Scope and Application
The Banking Act 1959 grants the Australian Prudential Regulation Authority (APRA) the authority to grant an Authorised Deposit-taking Institution (ADI) the licence to carry out banking business in Australia, as evidenced by the Authority granted to E.SUN Commercial Bank, Ltd. This Act applies to ADIs, which are entities authorised to accept deposits and carry out banking transactions. The authority granted under the Act is subject to specific conditions, which in the case of E.SUN Commercial Bank, Ltd., include restrictions on the acceptance of deposits from certain sources unless the amount exceeds $250,000. The Act applies nationally across Australia and APRA can impose, vary, or revoke conditions through written notice. APRA may also extend or restrict the application of this Act through subordinate instruments, ensuring that banking operations adhere to prudential standards. The Act does not specify any exclusions but provides pathways for reconsideration and appeal for those affected by APRA's decisions.
Key Provisions
The primary section of this legislation (subsection 9(3) of the Banking Act 1959) grants E.SUN Commercial Bank, Ltd. the authority to carry on banking business in Australia. This authority is granted by Keith Chapman, a delegate of the Australian Prudential Regulation Authority (APRA). The authority comes with specific conditions that relate to prudential matters, as outlined in the attached Schedule. These conditions are imposed under paragraph 9(4)(a) of the Act, and they are intended to regulate the bank's operations to ensure they meet certain standards and requirements set by APRA.
The obligations and requirements imposed by the Act on E.SUN Commercial Bank, Ltd. include, but are not limited to, a restriction on the acceptance of deposits or other funds for amounts less than $250,000 from certain sources. Specifically, the bank is not permitted to accept such deposits or funds from unincorporated entities or non-resident individuals unless the initial balance is at least $250,000. This condition aims to manage the bank's risk profile and ensure that it operates within the prudential framework set by APRA.
Should E.SUN Commercial Bank, Ltd. fail to comply with any of the conditions imposed on its authority, it may commit an offence under subsection 9(6) of the Act. The penalty for such an offence can be significant; for an individual, it is 200 penalty units, while for a body corporate, it can be up to 1,000 penalty units. Additionally, the offence is classified as an indictable offence, meaning it can be prosecuted in a higher court. If the contravention continues for more than one day, the bank is liable for each day the contravention persists, including the day of conviction and any subsequent days until the matter is resolved. This stringent approach ensures that the bank adheres to the regulatory requirements to maintain financial stability and protect depositors.