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Deposit Takers Act 2023

Crisis management and resolution - Conduct of resolution - Bank may dispose of business undertaking or property, rights, or liabilities

320: Bank may dispose of business undertaking, etc, to bridge institution or asset management vehicle

You could also call this:

"The Bank can sell its business to a new company to help it stay afloat."

Illustration for Deposit Takers Act 2023

The Bank can do some things to help with its business. You can think of the Bank like a big company that helps people with money. The Bank can form a new company, which is like a separate business, and register it under the Companies Act 1993. The Bank can also buy shares in this new company or sell shares to other people.

The Bank can sell some of its business to this new company or to other people. It can also sell the whole business or just part of it. The Bank gets to decide the terms and conditions of these sales.

This means the Bank has some extra options to help with its business, but it does not limit what the Bank can already do.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS534634.

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rules
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319: Bank’s disposal power, or

"The Bank's power to sell or get rid of a troubled deposit taker's business or assets"

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321: Body corporate is also subject to resolution, or

"Companies can be treated like failed banks and have to follow special rules"

Part 7Crisis management and resolution
Conduct of resolution: Bank may dispose of business undertaking or property, rights, or liabilities

320Bank may dispose of business undertaking, etc, to bridge institution or asset management vehicle

  1. For the purposes of section 319, 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 all or any of the shares of B:
      1. make 1 or more sales, transfers, or dispositions to B under section 319(1)(a) to (c):
        1. offer, issue, or sell all or any of the shares in B to any person, credited as fully or partly paid, on the terms and conditions that the Bank thinks fit:
          1. sell, transfer, or dispose of the whole or any part of the business undertaking of B to any 1 or more persons on the terms and conditions that the Bank thinks fit.

            1. This section does not limit any other powers of the Bank.

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