Consent to use restricted expressions - Class Consent - Building Societies, Credit Unions and Trustees of Superannuation Entities - Banking Act 1959

Administered by Department of the Treasury

Legislation au F2007B00101 Not in force Legislative Instrument

Legislation content

 

Banking Act 1959

 

 

CONSENT

TO USE RESTRICTED EXPRESSIONS

 

 

  CLASS CONSENT:    BUILDING SOCIETIES AND CREDIT UNIONS

   TRUSTEES OF SUPERANNUATION ENTITIES

 

 

 

I, Graeme John Thompson, Chief Executive Officer of, and a delegate of the Board of, the Australian Prudential Regulation Authority (APRA):

 

  • under paragraph 66(2)(c) of the Banking Act 1959 (the Banking Act), REVOKE all consents conferred on transferred bodies by item 8 of Schedule 8 of the Financial Sector Reform (Amendments and Transitional Provisions) Act (No 1) 1999 (the Transitional Act); and

 

  • under paragraphs 66(1)(d) and 66(2)(a) of the Banking Act, CONSENT to the use of the following restricted expressions:

 

 bank

 

 banker

 

 banking

 

 building society

 

 credit union

 

 credit society

 

 credit co-operative (being an expression specified in a determination dated 28 June 1999 in force under subsection 66(5) of the Banking Act)

 

in the circumstances, and subject to the conditions, specified below.

 

 

Building societies and credit unions

 

1. A Building Society may use the expression building society in relation to its financial business which it carries on in the capacity of a building society.

 

2. A Credit Union may use the expressions credit union, credit society and credit co-operative in relation to its financial business which it carries on in the capacity of a credit union.

 

3. A Building Society or Credit Union may use the expression banking in relation to its banking activities.

 

4. A body corporate that is related to a Building Society may use the expression building society in relation to the financial business which the Building Society carries on in the capacity of a building society, if the condition in clause 7 is satisfied.

 

5. A body corporate that is related to a Credit Union may use the expressions credit union, credit society and credit co-operative in relation to the financial business which the Credit Union carries on in the capacity of a credit union, if the condition in clause 7 is satisfied.

 

6. A body corporate that is related to a Building Society or Credit Union may use the expression banking in relation to the banking activities of the Building Society or Credit Union, if the condition in clause 7 is satisfied.

 

7. The condition is that the expression is not used in a misleading or deceptive way (for example, so as to suggest that the body corporate that is related to the Building Society or Credit Union is authorised to act as a building society or credit union, or to engage in banking activities, where that is not the case).

 

 Trustees of superannuation entities

 

8. A trustee of a superannuation entity all the members of which are officers or employees, or former officers or employees, of an ADI may use the ADI’s name as part of:

 (a) the trustee’s name; and

 (b) the superannuation entity’s name;

 despite the fact that the ADI’s name contains the expression bank, banker, banking, credit union, credit society or credit co-operative, if the conditions in clause 9 are satisfied.

 

9. The conditions are:

 (a) the ADI is permitted to use the expression as part of its name by this instrument or by another consent in force under section 66 of the Banking Act; and

 (b) the ADI’s name is not used in a misleading or deceptive way (for example, so as to suggest that the trustee or the superannuation entity is a bank, building society or credit union where that is not the case).

 

 [NOTE: Nothing in clauses 8 and 9 is intended to authorise any act that infringes a person’s rights under, or contravenes, any other law.]

 


 Interpretation

 

10. In this instrument:

 

 ADI:

 (a) means an authorised deposit-taking institution in relation to which an authority under subsection 9(3) of the Banking Act is in force; and

 (b) for the avoidance of doubt, includes a transferred body whose authority under subsection 9(3) of the Banking Act has not been revoked;

 

 banking activities means:

 (a) both taking money on deposit (otherwise than as part-payment for identified goods or services) and making advances of money; and

 (b) any other financial activities prescribed by regulations for the purposes of the definition of banking business in subsection 5(1) of the Banking Act; and

 (c) financial activities incidental to the activities mentioned in paragraphs (a) and (b);

 

 Building Society means a body corporate whose name appears under the heading “Building Societies” in the list of authorised deposit-taking institutions published on APRA’s website;

 

 Credit Union means a body corporate whose name appears under the heading “Credit Unions” in the list of authorised deposit-taking institutions published on APRA’s website;

 

 holding company, in relation to a body corporate, means a body corporate of which the first-mentioned body corporate is a subsidiary;

 

 subsidiary, in relation to a body corporate, means a subsidiary of the body corporate within the meaning of Division 6 of Part 1.2 of the Corporations Law;

 

 superannuation entity means:

 (a) a regulated superannuation fund; or

 (b) an approved deposit fund; or

 (c) a pooled superannuation trust;

 within the meaning of the Superannuation Industry (Supervision) Act 1993;

 

 transferred body means a transferring body (within the meaning of Schedule 8 of the Transitional Act) which is taken to have been granted an authority under subsection 9(3) of the Banking Act by virtue of subitem 7(3) of Schedule 8 of the Transitional Act;

 

 trustee, in relation to a superannuation entity, means:

 (a) if there is a trustee (within the ordinary meaning of that expression) of the superannuation entity – the trustee; or

 (b) in any other case – the person who manages the superannuation entity;

 

 a body corporate is related to a Building Society or Credit Union if the body corporate is:

 (a) a holding company of; or

 (b) a subsidiary of; or

 (c) a subsidiary of a holding company of;

 the Building Society or Credit Union.

 

 Commencement

 

11. This instrument comes into force on the date on which it is notified in the Gazette.

 

 

 

 

 

 

   [NOTE: By virtue of section 66 of the Banking Act, a person (whether an individual, a body corporate or a body politic) must not use the expressions bank, banker, banking, credit union, credit society and credit co-operative in relation to a financial business carried on by the person except as permitted by:

  •    section 66 of the Banking Act; or
  •    a consent in force under section 66 of the Banking Act.]

 

 

 

Dated 19 May 2000

 

 

[Signed]

 

G J Thompson

Chief Executive Officer

Overview

The Banking Act 1959 was enacted to regulate the banking industry in Australia, addressing the need for clear and consistent regulation of financial institutions. This legislative instrument, issued by the Australian Prudential Regulation Authority (APRA), specifically focuses on the consent to use restricted expressions by certain entities. It revokes previous consents granted to transferred bodies and provides new consents to building societies, credit unions, and trustees of superannuation entities to use specific terms like "bank," "banking," and "credit union" under certain conditions. The policy objective is to ensure these terms are used accurately and not in a manner that misleads consumers, thereby maintaining transparency and integrity in the financial sector. This instrument is part of a broader effort to refine and update regulatory practices in response to evolving financial landscapes and consumer protection needs.

Scope and Application

The Banking Act 1959, as amended, includes provisions that govern the use of certain restricted expressions by financial institutions and related entities, specifically building societies, credit unions, and trustees of superannuation entities. Under this legislation, building societies and credit unions are permitted to use terms such as "building society", "credit union", "credit society", "credit co-operative", and "banking" in relation to their financial businesses, provided they do so in accordance with the conditions outlined in the Act. This consent extends to related entities of building societies and credit unions, provided they meet specific criteria to avoid misleading or deceptive use of these expressions. Trustees of superannuation entities affiliated with Authorised Deposit-taking Institutions (ADIs) can also incorporate the ADI's name in their own and the superannuation entity's names, subject to certain conditions to prevent misleading representations about their financial authorisation. The Act specifies that these permissions are applicable nationally, subject to the regulatory oversight of the Australian Prudential Regulation Authority (APRA). The instrument does not explicitly exclude any particular entities or activities, but it does require compliance with the conditions to avoid misleading use. The scope of the Act can be further defined or extended through subordinate instruments issued under its authority.

Key Provisions

The legislative instrument, dated 19 May 2000, revokes all consents conferred on transferred bodies by item 8 of Schedule 8 of the Financial Sector Reform (Amendments and Transitional Provisions) Act (No 1) 1999 and grants new consents to the use of restricted expressions by certain entities. These entities include building societies and credit unions as well as trustees of superannuation entities. Building societies and credit unions can use expressions such as 'building society', 'credit union', 'credit society', 'credit co-operative', and 'banking' in relation to their financial business, provided it is not misleading or deceptive (sections 1–7). Trustees of superannuation entities, where all members are officers or employees of an authorised deposit-taking institution (ADI), can include the ADI’s name in their own name and that of the superannuation entity, even if it contains restricted expressions, as long as the ADI is permitted to use these expressions and the name is not used in a misleading or deceptive way (sections 8 and 9). Under this Act, building societies, credit unions, and related entities must adhere to specific conditions when using restricted expressions. These entities can use terms like 'building society', 'credit union', 'credit society', 'credit co-operative', and 'banking' only in relation to their financial activities and must ensure the use is not misleading or deceptive (section 7). Trustees of superannuation entities must also ensure that the use of an ADI’s name, even if it contains restricted expressions, does not mislead the public about their status or authority (section 9). These obligations aim to prevent misleading representations about the entities’ financial capabilities and regulatory status. Breaches of the provisions outlined in this instrument may lead to legal consequences. The Act prohibits the use of restricted expressions unless permitted by the Act or a consent under section 66 of the Banking Act. Any misleading or deceptive use of these expressions could result in legal action. While the specific penalties for breaches are not detailed in this instrument, breaches of similar provisions in the Banking Act generally attract penalties that can include fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, as well as other relevant laws and regulations.

Legal classification tags

Area of Law
Financial & Banking Law
Instrument
Legislative Instrument
Concepts
Definitions & Interpretation
Regulatory Standards
Prohibited Conduct
Reporting & Disclosure Obligations

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.