Consent to sale or disposal of business of an authorised deposit-taking institution
Banking Act 1959
TO: Fire Brigades Employees' Credit Union Limited ABN 41 087 650 066 (the body corporate)
SINCE
- the body corporate is an ADI for the purposes of the Banking Act 1959 (the Act); and
B. the body corporate proposes to enter into an arrangement or agreement for the sale or disposal of its business (by amalgamation or otherwise) to Teachers Mutual Bank Limited ABN 30 087 650 459, as described in the attached Schedule (the sale or disposal); and
C. I have taken into account the national interest.
I, Louis Serret, a delegate of the Treasurer, under subsection 63(1) of the Act, CONSENT to the sale or disposal.
Dated 26 August 2016
[Signed]
Louis Serret General Manager
Specialised Institutions Division Central Region
Interpretation Document ID: 224146
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.
foreign ADI has the meaning given in subsection 5(1) of the Act.
Note 1
By virtue of subsection 63(2) of the Act, any arrangement, agreement or reconstruction and any
such sale or disposal in pursuance of any such agreement or arrangement, entered into without the prior consent of the Treasurer is void and of no effect. Subsection 63(3) provides that the consent of the Treasurer shall not be unreasonably withheld.
Note 2
Under subsection 63(1AA) of the Act, the Treasurer must arrange for notice of this consent to be
published in the Gazette as soon as practicable.
Note 3
Under subsection 63(1) of the Act, an ADI, other than a foreign ADI, is guilty of an offence if the
ADI enters into an arrangement or agreement for the sale or disposal of its business or for carrying on business in partnership with another ADI, or effects a reconstruction of the ADI, without the Treasurer’s prior consent in writing. The maximum penalty is 200 penalty units.
Note 4
offence.
Note 5
Under subsection 63(1A) of the Act, an offence against subsection 63(1) of the Act is an indictable
Under paragraph 63(5)(a) of the Act, the Treasurer may, in writing, delegate all or any of his or her
powers under subsection 63 to APRA, an APRA member or an APRA staff member.
Schedule
An arrangement for a voluntary total transfer of business under the Financial Sector (Business Transfer and Group Restructure) Act 1999.
Overview
The Banking Act 1959 was enacted to regulate the banking industry in Australia, ensuring stability and integrity within the financial system. The Act, administered by the Australian Government, addresses the need for oversight and regulation of authorised deposit-taking institutions (ADIs) to protect the interests of customers and maintain the overall health of the banking sector. One significant aspect of the Act is the requirement for the Treasurer's consent before an ADI can enter into any arrangement or agreement for the sale or disposal of its business, including amalgamations. This consent mechanism is intended to safeguard the national interest by ensuring that any significant changes within the banking sector are closely monitored and approved to maintain financial stability. The legislation explicitly states that any sale or disposal agreement made without the Treasurer's prior written consent is void and carries significant penalties, reinforcing the importance of this regulatory oversight.
Scope and Application
The Banking Act 1959 applies to authorised deposit-taking institutions (ADI) within Australia, including the Fire Brigades Employees' Credit Union Limited, as it proposes to sell or dispose of its business. This consent is necessary to ensure that the transaction aligns with the national interest. The Act extends its jurisdiction over the entities involved in the sale or disposal, and any such arrangement or agreement entered into without the Treasurer's prior consent is void. The Treasurer, or a delegate, must not unreasonably withhold consent. The legislation mandates that any consent granted must be published in the Gazette. Additionally, the Act imposes penalties for any unauthorised sale or disposal of business by an ADI, with a maximum penalty of 200 penalty units. The Treasurer may delegate their powers under the Act to the Australian Prudential Regulation Authority (APRA) or its members or staff. The scope of this legislation is confined to Australia, as it pertains to Australian ADIs and their business transactions.
Key Provisions
The Banking Act 1959 (the Act) is a significant piece of legislation that governs the banking sector in Australia. Section 63 of the Act outlines the requirements for authorised deposit-taking institutions (ADIs) to obtain the Treasurer's consent before entering into an arrangement or agreement for the sale or disposal of their business, including amalgamations. The document in question pertains to the Fire Brigades Employees' Credit Union Limited, which is an ADI under the Act, and its proposal to sell or dispose of its business to Teachers Mutual Bank Limited. The Treasurer, through a delegate, has given consent for this sale or disposal, as detailed in the attached Schedule.
The obligations and requirements imposed by the Act on the parties involved include obtaining the Treasurer's prior consent in writing before proceeding with any sale or disposal of the business. The Act specifies that without this consent, any arrangement or agreement is void and of no effect. Additionally, the Treasurer must not unreasonably withhold consent. The document highlights that the consent has been granted by Louis Serret, a delegate of the Treasurer, taking into account the national interest. This consent ensures that the sale or disposal is conducted in a manner that is in the best interest of the public and the financial stability of the banking sector.
The Act also imposes penalties for breaches of its provisions. Under section 63(1) of the Act, an ADI, other than a foreign ADI, commits an offence if it enters into an arrangement or agreement for the sale or disposal of its business, enters into a partnership with another ADI, or effects a reconstruction without the Treasurer's prior consent. The maximum penalty for this offence is 200 penalty units, which translates to a substantial financial penalty. Furthermore, the offence is indictable, meaning it can be tried in a higher court. This stringent enforcement mechanism underscores the importance of complying with the Act's requirements to maintain the integrity and stability of the financial sector.