Revocation of authority to carry on banking business 2022 – Citigroup Pty Limited

Overview

The Revocation of Authority to Carry on Banking Business 2022 is an instrument under the Banking Act 1959, enacted to address the specific situation where Citigroup Pty Limited, with ABN 88 004 325 080, has formally requested the revocation of its section 9 authority to carry on banking business in Australia. The revocation was authorised by Therese McCarthy Hockey, a delegate of the Australian Prudential Regulation Authority (APRA), and is based on the premise that such revocation would not be contrary to the national interest or the interests of the depositors of the body corporate. This legislative instrument was issued under the authority of the Banking Act 1959 and came into effect on 30 June 2022. The primary policy objective behind this revocation appears to be the formal cessation of Citigroup Pty Limited's operations within the Australian banking sector, as per the company's request, while ensuring the protection of depositor interests and national security.

Scope and Application

The Revocation of Authority to Carry on Banking Business 2022 (C2022G00517) pertains to Citigroup Pty Limited ABN 88 004 325 080, revoking its section 9 authority to carry on banking business in Australia. This action is taken in accordance with the Banking Act 1959, following a formal request by Citigroup to the Australian Prudential Regulation Authority (APRA). The instrument is effective from 30 June 2022, and is issued by Therese McCarthy Hockey, an Executive Director and delegate of APRA, who is satisfied that the revocation does not conflict with the national interest or the interests of the depositors of Citigroup. The legislation clearly outlines the process and conditions under which the authority is revoked, emphasising APRA's duty to notify the public of such revocations through the Gazette and other appropriate means. This revocation does not extend to other entities or industries and is specific to Citigroup's operations in Australia.

Key Provisions

The key operative sections of the Revocation of authority to carry on banking business 2022 – Citigroup Pty Limited, under the Banking Act 1959, are contained in the introductory statement. Specifically, section 9A(1) of the Act allows for the revocation of a section 9 authority, which is the authority to carry on banking business in Australia, upon certain conditions being met. In this case, Citigroup Pty Limited has requested the revocation of its section 9 authority, and the Executive Director of the Banking Division, Therese McCarthy Hockey, has determined that the revocation would not be contrary to the national interest or the interests of the depositors (sections A and B). The revocation takes effect from 30 June 2022. The Act imposes obligations on Citigroup Pty Limited, primarily to notify APRA of its intention to revoke its section 9 authority. Once this notification is made, APRA must consider whether the revocation would be contrary to the national interest or the interests of the depositors. If satisfied that it would not, APRA can proceed with the revocation, as demonstrated in this case. APRA also has the obligation to publish notice of the revocation in the Gazette, and may choose to publish it in other ways as well. Failure to comply with the provisions of the Banking Act 1959 can result in various consequences. While the specific offences, penalties, or civil/criminal consequences are not detailed within this revocation notice, it is important to note that breaches of the Act can lead to enforcement actions by APRA. These actions may include financial penalties, orders to cease certain activities, or other regulatory measures. Additionally, individuals or entities found guilty of criminal offences under the Act may face imprisonment, fines, or both, depending on the severity of the breach and the specific provisions of the Act that have been contravened.