Plain language law

New Zealand law explained for everyone

Deposit Takers Act 2023

Crisis management and resolution - Conduct of resolution - Bank may form body corporate to acquire New Zealand business

314: Bank may form body corporate to acquire New Zealand business

You could also call this:

"A New Zealand bank can create a new company to help a troubled overseas bank in New Zealand."

Illustration for Deposit Takers Act 2023

You can think of a bank as a place where people keep their money. If a bank from another country is in trouble, the Bank in New Zealand can help. It can form a new company under the Companies Act 1993. The Bank can buy shares in this new company or give it shares. The Governor-General can decide that some of the troubled bank's property, rights, and debts will go to the new company on a certain date. When this happens, the new company gets the property, rights, and debts of the troubled bank on that date.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS533520.

This page was last updated on — View changes

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rules
Previous

313: Bank’s investigation powers, or

"The Bank's powers to investigate deposit takers"

Next

315: Vesting does not affect deposit taker’s obligations or place it in breach, or

"Vesting does not change a deposit taker's responsibilities"

Part 7Crisis management and resolution
Conduct of resolution: Bank may form body corporate to acquire New Zealand business

314Bank may form body corporate to acquire New Zealand business

  1. If an overseas licensed deposit taker (A) is in resolution, the Bank may do 1 or more of the following:

  2. form and register a body corporate (B) under the Companies Act 1993:
    1. subscribe for or acquire, as trustee for A, all or any of B’s shares:
      1. issue all or any of B’s shares as fully or partly paid on the terms and conditions that the Bank thinks fit.

        1. The Governor-General may, by Order in Council, on the advice of the Minister given in accordance with a recommendation of the Bank, declare that the whole or any part of any property, rights, and liabilities of A relating to its New Zealand business will vest in B on a date specified in the order.

        2. The property, rights, and liabilities of A vest in B on the date specified.

        Compare