Financial Sector Legislation Amendment (Crisis Resolution Powers and Other Measures) Act 2018 (10 of 2018)

Schedule 1   Amendment of the Banking Act 1959

Part 1   Main amendments

Banking Act 1959

65   Subsection 13A(2)

Repeal the subsection, substitute:

(1B) APRA may take any of the actions mentioned in subsection (1C) in relation to a body corporate (the target body corporate ) if:

(a) the target body corporate is any of the following:

(i) an authorised NOHC of an ADI (the relevant ADI );

(ii) a subsidiary of an authorised NOHC of an ADI (also the relevant ADI );

(iii) a subsidiary of an ADI (also the relevant ADI ); and

(b) the condition in subsection (1D), (1E) or (1F) is satisfied; and

(c) the target body corporate is incorporated in Australia; and

(d) the target body corporate is not a body corporate of a kind specified in regulations (if any) made for the purposes of this paragraph.

(1C) The actions are as follows:

(a) taking control of the business of the target body corporate;

(b) appointing an administrator to take control of the business of the target body corporate.

Note: For information about another circumstance in which APRA may take control of the business of the target body corporate, see section 65.

(1D) The condition in this subsection is satisfied if:

(a) either:

(i) a Banking Act statutory manager has taken control of the relevant ADI; or

(ii) the conditions in any or all of paragraphs (1)(a), (b), (c), (d) or (e)are satisfied in relation to the relevant ADI, and APRA intends that a Banking Act statutory manager will take control of the relevant ADI; and

(b) APRA considers that the target body corporate provides services that are, or conducts business that is, essential to the capacity of the relevant ADI to maintain its operations.

(1E) The condition in this subsection is satisfied if:

(a) either:

(i) a Banking Act statutory manager has taken control of the relevant ADI; or

(ii) the conditions in any or all of paragraphs (1)(a), (b), (c), (d) or (e)are satisfied in relation to the relevant ADI, and APRA intends that a Banking Act statutory manager will take control of the relevant ADI; and

(b) APRA considers that it is necessary for a Banking Act statutory manager to take control of the target body corporate, in order to facilitate the resolution of any of the following:

(i) the relevant ADI;

(ii) an authorised NOHC of the relevant ADI;

(iii) a relevant group of bodies corporate of which the relevant ADI is a member;

(iv) a particular member or particular members of such a group.

(1F) The condition in this subsection is satisfied if:

(a) there is an external administrator of the target body corporate, or APRA considers that, in the absence of external support:

(i) the target body corporate may become unable to meet its obligations; or

(ii) the target body corporate may suspend payment; and

(b) APRA considers that it is necessary to take an action mentioned in subsection (1C) in respect of the target body corporate in order to enable the relevant ADI to maintain its operations, or in order to facilitate the resolution of any of the following:

(i) the relevant ADI;

(ii) an authorised NOHC of the relevant ADI;

(iii) a relevant group of bodies corporate of which the relevant ADI is a member;

(iv) a particular member or particular members of such a group.

(2) If:

(a) APRA is in control of a body corporate's business under this Subdivision - APRA is the Banking Act statutory manager of the body corporate; or

(b) an administrator appointed by APRA is in control of a body corporate's business under this Subdivision - the administrator is the Banking Act statutory manager of the body corporate.

Note: This section and other provisions relating to statutory management do not apply to the aspects described in subsection 11E(1) of the business and management of a foreign ADI.

(2A) If APRA appoints 2 or more Banking Act statutory managers of a body corporate, or appoints one or more additional Banking Act statutory managers of a body corporate:

(a) the functions and powers under this Act of a Banking Act statutory manager of the body corporate may be performed or exercised by:

(i) all of the Banking Act statutory managers of the body corporate acting jointly; or

(ii) each of the Banking Act statutory managers of the body corporate acting individually (except to the extent (if any) specified in a notice given by APRA under paragraph (b)); and

(b) at the time of appointment, APRA may give all of the Banking Act statutory managers of the body corporate a notice in writing for the purposes of subparagraph (a)(ii), specifying limits or conditions on their ability to perform functions and exercise powers individually; and

(c) treat a reference in this Act to a Banking Act statutory manager as being a reference to whichever one or more of those Banking Act statutory managers the case requires.