Banking Act 1959 (Cth)

Banking Act 1959

No. 6, 1959

Compilation No. 68

Compilation date: 21 February 2025

Includes amendments: Act No. 14, 2025

About this compilation

This compilation

This is a compilation of the Banking Act 1959 that shows the text of the law as amended and in force on 21 February 2025 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Editorial changes

For more information about any editorial changes made in this compilation, see the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the Register for the compiled law.

Self‑repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

Contents Part I—Preliminary 1 Short title 2 Commencement 2A Main objects of this Act 4 Repeal 5 Interpretation 6 Application of Act 6A Cessation of application of Act to Territory 6B Application of Criminal Code Part II—Provisions relating to the carrying on of banking business Division 1—Authority to carry on banking business 7 Person other than a body corporate must not carry on banking business 8 Only the Reserve Bank and bodies corporate that are ADIs may carry on banking business 9 Authority to carry on banking business 9AA Conditions on an authority 9AB Breach of authority conditions 9A Revocation of authority etc. 9B Bodies that cease to exist or change their names 9C Publication of list of ADIs 9D Authority to carry on banking business for a limited time 9E Authority to carry on banking business in Australia for a limited time—extension 9F Authority to carry on banking business in Australia for a limited time—continuation after expiry 10 APRA to be supplied with certain documents 11 APRA may determine that provisions of this Act do not apply Division 1AA—Authority to be a NOHC of an ADI 11AA Authority to be a NOHC 11AAA Conditions on an authority 11AAB Breach of authority conditions 11AB Revocation of authority etc. 11AC Bodies that cease to exist or change their names 11AD Publication of list of NOHCs 11AE APRA may give notice to ensure that ADI has an authorised NOHC Division 1A—Prudential supervision and monitoring of ADIs and authorised NOHCs Subdivision A—Prudential supervision and monitoring of ADIs and authorised NOHCs generally 11AF APRA may make prudential standards for ADIs and authorised NOHCs 11AG Obligation to comply with the prudential standards 11A Prudential requirements may also be prescribed by the regulations 11B APRA to monitor prudential matters 11C Division not to limit operation of other provisions Subdivision B—Conversion and write‑off provisions 11CAA Definitions 11CAB Conversion and write‑off provisions 11CAC Conversion or write‑off etc. not grounds for denial of obligations Division 1BA—APRA's power to issue directions Subdivision A—Directions other than to enforce certified industry support contracts 11CA APRA may give directions in certain circumstances Subdivision B—Directions to enforce certified industry support contracts 11CB APRA may certify an industry support contract 11CC APRA may direct parties to an industry support contract to comply with the contract Subdivision C—General provisions relating to all directions 11CD Direction not grounds for denial of obligations 11CE Supply of information about issue and revocation of directions 11CG Non‑compliance with a direction Subdivision D—Secrecy and disclosure provisions relating to all directions 11CH APRA may determine that a direction is covered by secrecy provision 11CI Secrecy relating to directions 11CJ Disclosure of publicly available information 11CK Disclosure allowed by APRA 11CL Disclosure to legal representative for purpose of seeking legal advice 11CM Disclosure allowed by APRA Act secrecy provision 11CN Disclosure in circumstances set out in the regulations 11CO Disclosure for purpose 11CP Exceptions operate independently Division 1B—Provisions relating to certain ADIs 11E Limited application of Division 2 etc. to foreign ADIs 11EA APRA's power to apply for foreign ADI to be wound up 11F Assets of foreign ADIs Division 2—Protection of depositors Subdivision A—General provisions relating to depositor protection 12 APRA to protect depositors 13 ADI to supply information to APRA 13A Consequences of inability or failure of ADI etc. to meet certain requirements 13B Investigators—ADI must provide information and facilities 13BA Start of control of body corporate's business by Banking Act statutory manager 13C Banking Act statutory managers—termination of control Subdivision AA—Recapitalisation directions by APRA 13D Who this Subdivision applies to 13E Recapitalisation direction by APRA 13F Additional contents of a recapitalisation direction 13G Compliance with a recapitalisation direction 13H APRA must obtain expert's report on the fair value of shares etc. 13J Determination of the fair value of shares by an expert 13K Determination of the fair value of rights by an expert 13L Ascertaining the fair value of other capital instruments 13M Contravention of certain provisions does not affect the validity of recapitalisation direction etc. 13N Recapitalisation direction not grounds for denial of obligations 13P Supply of information about issue and revocation of recapitalisation directions 13Q Non‑compliance with a recapitalisation direction 13R Exceptions to Part IV of the Competition and Consumer Act 2010 Subdivision B—Provisions dealing with control of a body corporate's business by a Banking Act statutory manager 14A Banking Act statutory manager's powers and functions 14AAA Safeguards on exercise of Banking Act statutory manager's powers and functions 14AA Banking Act statutory manager's additional powers to facilitate recapitalisation 14AB Considering report before acting under section 14AA 14AC Act under section 14AA not ground for denial of obligations 14AD APRA may require a person to give information etc. for the purposes of this Division 14B Administrator in control—additional powers to recommend action by APRA 14C Banking Act statutory manager's liabilities and duties 14CA Transaction by Banking Act statutory manager not voidable under section 588FE of the Corporations Act 2001 14D Administrator in control—additional duties 14DAA Administrator in control—additional duties where action may affect financial system stability in Australia 14DA Administrator in control—additional duties where action may affect financial system stability in New Zealand 14E Termination of administrator's appointment 15 Effect on directors of Banking Act statutory manager taking control of a body corporate's business 15A Effect on external administrator of Banking Act statutory manager taking control of a body corporate's business 15B Moratorium—effect of Banking Act statutory management on court and tribunal proceedings 15BA Moratorium—effect of Banking Act statutory management on enforcement process regarding property 15BB Moratorium—effect of Banking Act statutory management on disposal of property 15BC Moratorium—restrictions on exercise of third party property rights 15BD Moratorium—effect of Banking Act statutory management on supply of essential services 15BE Moratorium—effect of Banking Act statutory management on annual general meeting 15C Certain circumstances not grounds for denial of obligations 15D Application of other provisions 16 Costs of statutory management 16A APRA must report to Treasurer and publish information about statutory management 16AA Exceptions to Part IV of the Competition and Consumer Act 2010 Subdivision C—APRA's powers to apply for ADI to be wound up 16AAA APRA's powers to apply for ADI to be wound up Division 2AA—Financial claims scheme for account‑holders with insolvent ADIs Subdivision A—Preliminary 16AB Purpose of this Division 16AC APRA's functions relating to this Division Subdivision B—Declaration of ADI 16AD Declaration that Subdivision C applies in relation to ADI 16AE Advice and information for decision on making declaration Subdivision C—Payment of account‑holders with declared ADI 16AF Payment of account‑holders with declared ADI 16AG Limit on payments to account‑holder with declared ADI 16AH Payment 16AHA Giving information about payments in a financial year 16AI Substitution of APRA for account‑holder as ADI's creditor 16AIA APRA may make transferred liabilities determination where transfer of business 16AIB Payment amounts under transferred liabilities determination 16AIC Consequences of transferred liabilities determination once certificate of transfer issued Subdivision D—Administration 16AJ Requiring assistance 16AK Obtaining information relevant to determining and paying entitlements 16AL Enforcing requirement for assistance or information 16AM Recovery of overpayments 16AN APRA may delegate functions and powers under this Division 16AO APRA's costs of administration Subdivision E—Account‑holder's claims against ADI remaining after entitlement 16AP When this Subdivision applies 16AQ Liquidator may admit debt or claim without normal proof 16AR How liquidator must pay distributions to account‑holder 16AS APRA may disclose relevant personal information to liquidator Subdivision F—Disclosure of information relating to new accounts 16AT APRA or liquidator to disclose information to ADI Subdivision G—Exceptions to Part IV of the Competition and Consumer Act 2010 16AU Exceptions to Part IV of the Competition and Consumer Act 2010 Division 2A—Auditors of ADIs and authorised NOHCs and their subsidiaries 16AV Appointed auditor's functions and duties 16B Auditors to give information to APRA on request 16BA Requirement for auditors to give information about ADIs 16C Auditor may provide information to APRA 16D Appointed auditor must notify APRA of attempts to unduly influence etc. the appointed auditor 16E Giving false or misleading information to auditor Division 2B—Removal of auditors of ADIs 17 APRA may remove an auditor of an ADI 18 Referring matters to professional associations for auditors Division 2C—Enforceable undertakings 18A Enforceable undertakings Division 3—Governance 19 Disqualified persons must not act for ADIs or authorised NOHCs 20 Who is a disqualified person? 21 Court power of disqualification 22 Court power to revoke or vary a disqualification etc. 22A Privilege against exposure to penalty—disqualification under section 21 23 APRA may remove a director or senior manager of an ADI or authorised NOHC Division 3A—Covered bonds 24 Guide to this Division 25 Application of Division 26 Covered bonds 27 Arrangements involving several ADIs 28 Restrictions on issuing covered bonds—8% rule 29 Restrictions on issuing covered bonds—APRA directions 30 Cover pool monitors 31 Assets that may be in cover pools 31A Maintenance of cover pools 31B Protection of certain contractual rights 31C Powers and obligations of Banking Act statutory manager or external administrator 31D Prudential standards—treatment of assets and liabilities 31E Prudential standards for covered bonds 31F APRA may direct covered bond special purpose vehicles to return certain assets Division 4—Mobilization of foreign currency 32 Interpretation 33 Transfer of foreign currency to Reserve Bank 34 Payment for transferred foreign currency 35 Sale of foreign currency by Reserve Bank Division 5—Advances 36 Advance policy Part IIA—ADI mergers (operation of State and Territory laws) 38A Operation of certain State and Territory laws relating to ADI mergers Part IIB—Provisions relating to the non‑ADI lenders Division 1—Main concepts 38B Meaning of non‑ADI lender and Part IIB provision of finance Division 2—Non‑ADI lender rules 38C APRA may make non‑ADI lender rules for non‑ADI lenders 38D Non‑ADI lender rules revoked after 2 years 38E Variation and revocation of non‑ADI lender rules 38F Notification and consultation regarding non‑ADI lender rules 38G Which non‑ADI lender rules, etc., are legislative instruments 38H Review of decisions relating to non‑ADI lender rules 38J Division not to limit operation of other provisions Division 3—APRA's power to issue directions 38K APRA may give directions in certain circumstances 38L Non‑compliance with a direction under section 38K Part III—Foreign exchange, foreign investment etc. 39 Power to make regulations 39A Extra‑territorial application of regulations Part IV—Gold 40 Operation of Part 41 Transfer of gold out of Australia 42 Delivery of gold 43 Vesting of gold delivered 44 Payment for gold 45 Limitation of sale and purchase of gold 46 Limitation on working of gold 47 Application of Part 48 Exemptions Part V—Interest rates 50 Control of interest rates Part VI—Reconsideration and Review of decisions 51A Definitions 51B Reconsideration of decisions 51C Review of decisions 51D Statements to accompany notification of decisions Part VIA—Protections in relation to information 52F Self‑incrimination Part VII—Financial records 60 Keeping of financial records Part VIII—Powers of APRA Division 1—Investigations 61 APRA may conduct investigations 61A Investigator may require production of books etc. 61B Concealing books, accounts or documents relevant to investigation Division 2—Examinations 61C Notice requiring appearance for examination 61D Conduct of examinations 61E Who may be present at examinations 61F Record of examination 61G Offences Division 3—Evidentiary use of certain material 61H Statements made at an examination—proceedings against examinee 61J Statements made at an examination—other proceedings 61K Weight of evidence under section 61J 61L Objection to admission of statements made at examination 61M Copies of, or extracts from, certain books, accounts and documents 61N Report under section 61 61P Exceptions to admissibility of report 61Q Material otherwise admissible Division 4—Information 62 Supply of information Division 5—Miscellaneous 62AA Legal professional privilege 62AB Powers of Court relating to non‑compliance with this Act Part IX—Miscellaneous 62A Notices to APRA 62B Involving APRA in proposed appointment of external administrators of ADIs and NOHCs 62C Involving APRA in applications by liquidator 62D Application by APRA for directions 62E APRA may request information from liquidator 63 Restructuring of ADIs 64 Conditions on consent to restructure an ADI 65 ADIs etc. may be directed to comply with Act 65A Injunctions 65B Civil penalties 66 Restriction on use of certain words and expressions 66AA Use of the word bank by ADIs 66A Restriction on use of expressions authorised deposit‑taking institution and ADI 67 Restriction on establishment or maintenance of representative offices of overseas banks 68 Bank holidays 69 Unclaimed moneys 69A Disclosure of information relating to unclaimed moneys 69B Powers about money of depositors who have died 69BA Institution of offence proceedings no bar to winding up 69C Conduct of directors, employees and agents 69D Disclosure of information received under Act prohibited in certain circumstances 69E Compensation for acquisition of property 69F Severability 70A Protection from liability—general 70AA Protection from liability—directions and secrecy 70AB Protection from liability—provisions do not limit each other 70B Act has effect despite the Corporations Act 70C Authorising contracts etc. for protecting depositors' interests and financial system stability 70D Borrowing funds for payments under authorised contracts etc. 70E Financial System Stability Special Account 70F Credits to the Account 70G Purposes of the Account 70H Debits to reflect reduced amounts specified in authorisations 71 Regulations Schedule 1—State and Territory laws relating to ADI mergers Schedule 2—Civil penalties Part 1—Contravention of a civil penalty provision 1 Federal Court may order person to pay pecuniary penalty for contravening civil penalty provision 2 Contravening a civil penalty provision is not an offence 3 Persons involved in contravening civil penalty provision 4 Recovery of a pecuniary penalty 5 Civil evidence and procedure rules for pecuniary penalty orders Part 2—Civil penalty proceedings and criminal proceedings 6 Civil proceedings after criminal proceedings 7 Criminal proceedings during civil proceedings 8 Criminal proceedings after civil proceedings 9 Evidence given in proceedings for penalty not admissible in criminal proceedings Endnotes Endnote 1—About the endnotes Endnote 2—Abbreviation key Endnote 3—Legislation history Endnote 4—Amendment history