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Deposit Takers Act 2023

Depositor compensation scheme - Preliminary provisions

195: Bank’s function under this Part

You could also call this:

"The Bank's job is to run a safety net to help people get their money back if a bank fails"

Illustration for Deposit Takers Act 2023

The Bank's job under this part of the law is to manage and run the depositor compensation scheme. You can think of the scheme like a safety net that helps people get their money back if something goes wrong with a bank. The Bank has to do things like decide if a notice should be issued under section 194, figure out who is entitled to compensation, and make sure people get their compensation as soon as possible.

The Bank also has to make sure it uses its rights to get money back from others if it pays out compensation, and it can use money from a special fund for certain purposes, like helping a bank in trouble, as outlined in subpart 5. It collects levies and interest from banks, as stated in subpart 6, and looks after the fund by administering, operating, and investing it.

The Bank monitors risks related to the scheme, and provides information to the public about it, while also doing all the other jobs given to it under this part of the law, including those outlined in subpart 4.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS501260.

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"Help for you if your bank account money is at risk"

Part 6Depositor compensation scheme
Preliminary provisions

195Bank’s function under this Part

  1. The Bank’s function under this Part is to manage and administer the scheme, including—

  2. deciding whether a notice should be issued under section 194; and
    1. determining entitlements to compensation under this Part; and
      1. ensuring that compensation under this Part is provided as soon as practicable after the Bank issues a specified event notice; and
        1. exercising rights of subrogation under subpart 4; and
          1. paying money out of the fund under subpart 5 for the purposes of supporting a resolution measure undertaken in relation to a licensed deposit taker; and
            1. collecting the levies and interest payable under subpart 6; and
              1. administering, operating, and investing the fund; and
                1. monitoring risks in connection with the scheme; and
                  1. providing, or facilitating the provision of, information to the public in connection with the scheme; and
                    1. performing and exercising the functions, powers, and duties conferred or imposed on it by or under this Part.