Deposit Takers Act 2023

Depositor compensation scheme - Entitlement to compensation - Entitlements subject to regulations

212: Regulations may provide for calculation of amount of person’s protected deposits or share of protected deposits

You could also call this:

"Rules can be made to work out how much of your bank money is protected by law."

Illustration for Deposit Takers Act 2023

When you have money in a bank, it is protected by law. The government can make rules to figure out how much of your money is protected. These rules can consider any benefits you might get if your protected money is held in different ways, such as by a trustee, a partnership, or with someone else. You might hold money jointly with someone, or you might hold it separately. The rules can also consider money held under a special arrangement, like a custodial service mentioned in section 431W of the FMCA. The government can make rules that tell the Bank how to treat your protected money. The Bank might need to split your money between you and someone else, or between several people.

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This page was last updated on 6 August 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS505262.

Topics:

Money and consumer rights > Banking and loansBusiness > Industry rules

211: Trustee that is ineligible in own personal capacity does not prevent compensation being payable in relation to trust, or

"Being a trustee means you can get compensation even if you can't get it as an individual."

213: Regulations may take into account transactions that have not been processed at quantification time, or

"Rules can consider transactions that haven't been processed yet when working out your protected deposits."

Part 6Depositor compensation scheme
Entitlement to compensation: Entitlements subject to regulations

212Regulations may provide for calculation of amount of person’s protected deposits or share of protected deposits

For the purposes of this subpart, the regulations may provide for the calculation of the amount of a person’s protected deposits or share of protected deposits, including by taking into account any benefit to which the person is entitled or that the person might (directly or indirectly) receive in connection with a protected deposit that is held in any 1 or more of the following ways:
by a trustee or trustees on trust:
by a partnership or any other unincorporated body:
by 2 or more persons jointly:
by 2 or more persons other than jointly:
by a person under a relevant arrangement (for example, under a custodial service referred to in section 431W of the FMCA).

Those regulations may authorise or require the Bank to treat any protected deposit held by—
a person as being held (in whole or in part) by—
1. that person and 1 or more other persons in the shares determined under the regulations; or
2. another person; or
3. 2 or more other persons in the shares determined under the regulations:
2 or more persons jointly or other than jointly as being held (in whole or in part) by—
1. 1 of those persons; or
2. 1 or more of those persons in the shares determined under the regulations; or
3. 1 or more of those persons and 1 or more other persons in the shares determined under the regulations; or
4. 1 or more other persons in the shares determined under the regulations.

If those regulations authorise or require the Bank to treat any protected deposit as being held (in whole or in part) by 2 or more persons, the regulations may also authorise or require the Bank to treat the protected deposit as being so held jointly or other than jointly.
Subsections (2) and (3) do not limit subsection (1).