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Amendments) Bill 1996
Explanatory note
This explanatory note relates to this Bill as introduced into Parliament.
The amended provisions will permit the persons concerned to use the
financial services offered by building societies and credit unions that are
subject to the Financial Institutions (NSW) Code (or a law of another State,
or of a Territory, that corresponds to that Code) in the same way as they may
use the financial services offered by banks.
The Bill also makes a number of consequential amendments and amendments
by way of statute law revision to reflect the new status of building societies
and credit unions consequent on the implementation of the Financial
Institutions Scheme, of which the Code referred to above forms part.
Clause 2 provides for the proposed Act to commence on a day or days to be
appointed by proclamation.
Clause 3 is a formal provision giving effect to Schedule 1.
Clause 4 makes it clear that the Regulations amended by the proposed Act
may be further amended, or repealed, by a regulation in the usual way.
Schedule 1
Schedule 1.50, 1.821.85, 1.115 and 1.116 contain the amendments having
the most far-reaching effect. The items concerned do the following:
item 1.50 inserts definitions of bank, building society and credit union
in the Interpretation Act 1987,
item 1.84 amends the Public Finance and Audit Act 1983 so as to
permit public money to be deposited with, and invested in, building
societies and credit unions as well as banks (and makes consequential
amendments),
item 1.82 makes similar amendments to the Public Authorities
(Financial Arrangements) Act 1987 in relation to the investment
powers of corporations constituted by or under an Act (and makes
consequential amendments),
item 1.115 does the same to the provision of the Trustee Act 1925 that
specifies the way in which a trustee may (subject to the terms of the
relevant trust) invest trust funds (and makes consequential
amendments),
items 1.85, 1.83 and 1.116, respectively, make consequential
amendments to regulations made under the Public Finance and Audit
Act 1983, the Public Authorities (Financial Arrangements) Act 1987
and the Trustee Act 1925.
The amendments to the provision of the Public Authorities (Financial
Arrangements) Act 1987 conferring powers of investment do not extend to
investments involving foreign currency. This is because section 121 of the
Financial Institutions (NSW) Code prohibits (with one exception) building
societies and credit unions from investing any of their funds, or carrying out
any of their activities, in foreign currency. (The one exception is that building
societies may borrow money in foreign currencies on the conditions specified
in the Code.)
The remaining items in Schedule 1 amend various other Acts and
Regulations to give effect to the object referred to above.
Explanatory note page 2