Commonwealth Numbered Regulations - Explanatory Statements

[Index] [Search] [Download] [Related Items] [Help]


BANKS (SHAREHOLDINGS) REGULATIONS (AMENDMENT) 1995 NO. 355

EXPLANATORY STATEMENT

STATUTORY RULES 1995 No. 355

Issued by the Authority of the Assistant 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 in which a person (including a corporation) may have an interest to 10 per cent, or 15 per cent with the approval of the Treasurer, of the total nominal amount of the voting shares of the bank. Under subsection 10(4) of the Act the Governor-General may, after application made to the Treasurer by a person, if the Governor-General is satisfied that to do so is in the national interest, fix a higher percentage for that person by instrument published in the Gazette. Subsection 10(5A) provides that the Governor-General may, on the publication under subsection 10(4) of an instrument fixing a percentage applicable to a corporation in respect of a bank, after application made to the Treasurer by the corporation, by instrument in writing published in the Gazette, declare that the percentage so fixed is also applicable to the persons who are from time to time relevant officers of the corporation in respect of the bank

Section 17 of the Act provides that the Governor-General may make regulations for the purposes of the Act.

The Governor and Company of the Bank of Scotland (Bank of Scotland) is incorporated in Scotland and is intending to acquire the Bank of Western Australia Ltd (BankWest) from the Western Australian Government. The Standard Life Assurance Company (Standard Life) owns approximately one third of the Bank of Scotland. BankWest is Western Australia's premier regional retail bank that provides a wide range of financial services to meet the needs of personal customers. farmers. small business, corporate enterprises and commercial enterprises.

The Bank of Scotland provides a range of financial services throughout the United Kingdom and the world. The Bank of Scotland has a long term view of its involvement in BankWest. in what is regarded as a strategic investment in the Australian market, and intends to expand into the South East Asian region. This long term commitment allied with Bank of Scotland's preference for high levels of delegation will facilitate stability for local management This will enable BankWest's management to focus on building a strong and viable business without being concerned about diversionary issues. A major economic benefit to the Western Australian economy will be Bank of Scotland's expertise in the resources sector.

Instruments have been gazetted in accordance with the Act, effectively fixing a percentage of 100 under subsection 10(4) for Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd in relation to the interests in BankWest.

Under section 9 of the Act the associates (including officers, partners, subsidiaries and related companies) of Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd would also be deemed to have the same interest in BankWest as those corporations. In the case of officers of Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd, an instrument pursuant to subsection 10(5A) of the Act is proposed which would fix a percentage of 100 in relation to interests in BankWest for those persons who are from time to time relevant officers of Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd.

Under the Act, it is not possible to make a 'class' instrument for the interests of the associates of Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd, other than its relevant officers. These other associates represent a large and ever-changing group of persons and corporations.

Rather than make an instrument pursuant to subsection 10(4) for every person within the meaning of section 9, it is convenient to prescribe these interests - that is, to have them disregarded for the purposes of section 10 of the Act - by regulation, 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 a person or class of persons as is prescribed, shall be disregarded. The Banks (Shareholdings) Regulations (the Regulations) currently prescribe a class of persons in relation to their interests in the banks listed in the Schedule to the Regulations, where those interests are deemed to be held by virtue of an associate relationship. The effect of the proposed amendments to the Regulations would be to disregard, for the purposes of the Act, interests in BankWest arising from associate relationships with Standard Life, Bank of Scotland and Scottish Western Australia Holdings Pty Ltd.

The details of the proposed Regulations are as follows:

The Schedule to the Banks (Shareholdings) Regulations has been amended by including the following bank:

Bank of Western Australia Ltd

and persons having an interest in one or more of the voting shares of a bank:

The Standard Life Assurance Company, being the corporation formed or incorporated under that name in Scotland

The Governor and Company of the Bank of Scotland, being the corporation formed or incorporated under that name in Scotland

Scottish Western Australia Holdings Pty Ltd


[Index] [Related Items] [Search] [Download] [Help]