EXPLANATORY STATEMENT
STATUTORY RULES 1985 NO 107
ISSUED BY THE AUTHORITY OF THE TREASURER
BANKS (SHAREHOLDINGS) ACT 1972
BANKS (SHAREHOLDINGS) REGULATIONS (AMENDMENT)
Section 10 of the Banks (Shareholdings) Act 1972 (the Act) generally limits the nominal amount of the voting shares of a bank incorporated in Australia in which a person (including a corporation) may have an interest to 10 per cent, or 15 per cent with the approval of the Treasurer, of the total nominal amount of the voting shares of the bank. Under sub-section 10(4) of the Act the Governor-General may, after application made to the Treasurer by a person, fix a higher percentage for that person by instrument published in the Gazette. Sub-section 10(3) provides that where a percentage is applicable in relation to a person, that person may not have a greater nominal amount of shares than the percentage so fixed.
The Governor-General of the Commonwealth of Australia on the recommendation of the Treasurer has granted a banking authority to Bank of Singapore (Australia) Limited.
Bank of Singapore (Australia) Limited is beneficially wholly owned by Oversea-Chinese Banking Corporation Limited. The Treasurer has agreed to a proposal whereby 49 per cent equity held by the Australian public will be phased in: 30 per cent to be introduced within 3 months, and a further 19 per cent within 3 years of the granting of the banking authority.
As required by the Act an instrument has been gazetted which separately but not cumulatively fixes a percentage of 100 under sub-section 10(4) for each of the following corporations in relation to their interests in Bank of Singapore (Australia) Limited:
• OCBC Holdings (Australia) Pty. Ltd.
• Oversea-Chinese Banking Corporation Limited.
Under section 9 of the Act the associates (ie all officers, partners, subsidiaries etc) of the above corporations are deemed to have the same interest in Bank of Singapore (Australia) Limited as the above-mentioned companies. The companies have made an application to the Treasurer for a ‘class’ instrument fixing a percentage of 100 in respect of their officers, pursuant to sub-section 10(5A) of the Act. Hence, an instrument has been gazetted which declares that for the purposes of the Act the percentage of 100 is also applicable to the persons who are from time to time relevant officers of each of the above corporations in respect to Bank of Singapore (Australia) Limited.
Under the Act, however, it is not possible to make such a ‘class’ instrument for the interests of the associates of those corporations other than the relevant officers. These other associates, as defined in section 9, would represent an extremely large and ever-changing list of persons/corporations and rather than make an instrument, pursuant to sub-section 10(4), for every person within the meaning of section 9 it is convenient to prescribe these interests as provided for by section 17 and paragraph 8(9)(d).
Paragraph 8(9)(d) of the Act provides that a prescribed interest in a share that is an interest of such person, or of the persons included in such class of persons, as is prescribed, shall be disregarded. The Banks (Shareholdings) Regulations (the Regulations) currently prescribe a class of persons in relation to their interests in the banks listed in the schedule to the Regulations, where those interests are deemed to be held by virtue of sub-section 9(2) of the Act, that is by virtue of an associate relationship. The effect of the Regulations is that these interests are disregarded for the purposes of the Act. The effect of the amendments to the Regulations is to do the same in the case of Bank of Singapore (Australia) Limited.
For each of the sixteen successful applicants announced by the Treasurer on 27 February 1985 which proceeds to the granting of a banking authority, a similar addition will be made to the Schedule to the Regulations.
Detail of the Regulation is as follows:
The Schedule to the Banks (Shareholdings) Regulations is amended by adding the following corporations to the Schedule in relation to Bank of Singapore (Australia) Limited.
• OCBC Holdings (Australia) Pty. Ltd.
• Oversea-Chinese Banking Corporation Limited.