EXPLANATORY STATEMENT
STATUTORY RULES 1981 NO 323
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 of the total nominal amount of the voting shares of the bank, or to 15 per cent in the case of persons given by the Treasurer an exemption from the 10 per cent limit.
TSB Group Plc (TSB), a UK incorporated public company involuted (through its subsidiaries) in banking, insurance and other financial services, has acquired Hill Samuel Group Plc (HSG) in the UK. TSB has thereby acquired an interest in 15 per cent of the voting shares in Macquarie Bank Limited (MBL) which HSG has, with the benefit of an exemption under the Act, through its wholly owned subsidiary Hill Samuel Holdings (Australia) Pty Limited. TSB has applied to the Treasurer for exemptions from compliance with the 10 per cent limit in sub-section 10(1), so as to allow it also to hold 15 per cent of the voting shares in MBL.
The Treasurer has granted to TSB and its relevant officers the requested exemptions pursuant to sub-sections 10(2) and 10(2B), since he has seen no objections in the national interest to doing so.
Under section 9 of the Act the associates (such as affiliates and subsidiaries) of TSB are deemed to have the same interest in shares in MBL as TSB. These associates could represent a large and ever-changing group of persons (both natural persons and corporations). Rather than attempt to list them and make specific exemptions from time to time pursuant to sub-section 10(2), 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 interests in shares in the banks listed at one place in the Schedule to the Regulations, and prescribe classes of persons who are associates or shareholders listed at another place in the Schedule, and whose interests are deemed to exist only by virtue of sub-section 9(2) of the Act, that is by virtue of an associate relationship.
There was already a regulation referring to each company in the chain of Hill Samuel companies held to have an interest in MBL shares. The amending regulation has added TSB to that list and so has prescribed a class of persons - the associates of TSB other than its relevant officers - in respect of their interests as associates in voting shares in MBL. The effect of such a regulation is that such interests on the part of the associates of TSB are disregarded for the purposes of the Act, although the restriction remains that TSB and the other members of the group would not be able to acquire through associates an interest in more than 15 per cent of voting shares in MBL without contravening the Act.