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Deposit Takers Act 2023

Crisis management and resolution - Conduct of resolution - Bank may suspend payment of money owing

330: Bank may suspend payment of money owing

You could also call this:

"Banks can temporarily stop paying back money they owe you if they're having problems."

Illustration for Deposit Takers Act 2023

If you have money in a bank that is having problems, the bank can stop paying you back for a while. The bank can also stop paying its debts or meeting its obligations to you. This means the bank does not have to give you your money back right away, or pay you what it owes you. The bank can do this even if it said it would pay you back in an agreement. If the bank stops paying you, it is not breaking its promise to you, and you cannot say the bank is going back on its word, because this action is allowed under certain conditions, which are explained in sections 331, 332, and 421(1) to (3).

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS533507.

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331: Bank may not suspend or cancel obligation incurred after deposit taker enters resolution, or

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Part 7Crisis management and resolution
Conduct of resolution: Bank may suspend payment of money owing

330Bank may suspend payment of money owing

  1. The Bank may, in respect of a licensed deposit taker in resolution,—

  2. suspend in whole or in part the repayment of any deposit, or the payment of any debt, or the discharge of any obligation, to any person; and
    1. cancel the obligation to provide funding to any person.

      1. This section applies despite the terms of any agreement.

      2. A suspension or cancellation does not constitute a breach or repudiation of any agreement entered into by the deposit taker with any person.

      3. This section is subject to sections 331, 332, and 421(1) to (3).

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