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Deposit Takers Act 2023

Crisis management and resolution - Conduct of resolution - Expenses

347: Expenses of resolution

You could also call this:

"Who pays the costs when a bank or company is being sorted out?"

Illustration for Deposit Takers Act 2023

When the Bank or a resolution manager is working on a resolution, you want to know who pays for their costs. The Bank or the resolution manager can charge their costs to certain people or companies, and these costs must be paid before any other debts are paid. These people or companies include a licensed deposit taker, a subsidiary or associated person that is in resolution, or a body corporate formed under section 314 or 320.

The Bank or the resolution manager decides how to split their costs between these people or companies. They can choose how to divide the costs in a way that they think is fair.

The costs include things like charges and expenses that the Bank or the resolution manager has properly incurred while doing their job under this part of the law and subparts 4, 5, 7, and 8.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS536018.

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rules
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Part 7Crisis management and resolution
Conduct of resolution: Expenses

347Expenses of resolution

  1. All costs, charges, and expenses properly incurred by the Bank or the resolution manager in the performance or exercise of the Bank’s or the resolution manager’s functions, duties, and powers under this subpart and subparts 4, 5, 7, and 8 are payable out of the property of any 1 or more of the following in priority to all other claims:

  2. the licensed deposit taker:
    1. a subsidiary or other associated person that is in resolution:
      1. a body corporate formed and registered under section 314 or 320.

        1. The Bank or the resolution manager (as the case may be) may apportion the costs, charges, and expenses between those persons in the manner that the Bank or the resolution manager thinks fit.

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