Deposit Takers (UDC Finance Limited) Exemption Notice 2010

  • expired
  • Deposit Takers (UDC Finance Limited) Exemption Notice 2010: expired, on 2 December 2015, by clause 3.

Reprint as at 2 December 2015

Coat of Arms of New Zealand

Deposit Takers (UDC Finance Limited) Exemption Notice 2010

(SR 2010/444)

Deposit Takers (UDC Finance Limited) Exemption Notice 2010: expired, on 2 December 2015, by clause 3.

Note

Changes authorised by subpart 2 of Part 2 of the Legislation Act 2012 have been made in this official reprint.

Note 4 at the end of this reprint provides a list of the amendments incorporated.

This notice is administered by the Reserve Bank of New Zealand.

Pursuant to section 157G of the Reserve Bank of New Zealand Act 1989, the Reserve Bank of New Zealand gives the following notice (to which is appended a statement of reasons of the Bank).

Notice

1 Title

This notice is the Deposit Takers (UDC Finance Limited) Exemption Notice 2010.

2 Commencement

This notice comes into force on 1 December 2010.

3 Expiry

This notice expires on the close of 1 December 2015.

4 Interpretation

(1)

In this notice, unless the context otherwise requires,—

ANZN means ANZ National Bank Limited

Bank means the Reserve Bank of New Zealand

UDC means UDC Finance Limited.

(2)

Any term or expression that is defined in the Act or the Regulations and used, but not defined, in this notice has the same meaning as in the Act or the Regulations.

5 Exemption from governance requirements

UDC is exempted, until the close of 31 May 2011, from section 157L of the Act.

6 Exemption from capital ratio requirements

(1)

UDC is exempted, until the close of 31 May 2011, from sections 157T and 157U of the Act.

(2)

The trustee in respect of the debt securities of UDC is exempted, until the close of 31 May 2011, from section 157T of the Act in respect of those securities.

7 Exemption from requirement to calculate risk-weighted amount for credit risk in accordance with regulation 11 of Regulations

UDC is exempted, on and from 1 June 2011, from—

(a)

regulation 9(1) of the Regulations, to the extent that it requires UDC’s risk-weighted amount for credit risk to be calculated in accordance with regulation 11 of the Regulations; and

(b)

regulation 11 of the Regulations.

8 Exemption from related party exposures requirements

(1)

UDC is exempted, until the close of 31 May 2011, from sections 157X and 157Y of the Act.

(2)

The trustee in respect of the debt securities of UDC is exempted, until the close of 31 May 2011, from section 157X of the Act in respect of those securities.

(3)

UDC is exempted, on and from 1 June 2011, from regulation 23(3)(b) of the Regulations.

9 Conditions of exemptions in clauses 5 to 8

The exemptions in clauses 5 to 8 are subject to the conditions that—

(a)

UDC remains a wholly owned subsidiary of ANZN:

(b)

ANZN remains a registered bank:

(c)

UDC must not allot any debt security unless the subscriber has, before subscription, received written notification (as applicable) that UDC is exempted,—

(i)

until the close of 31 May 2011, from—

(A)

the governance requirements in section 157L of the Act; and

(B)

the capital ratio requirements in sections 157T and 157U of the Act; and

(C)

the related party exposures requirements in sections 157X and 157Y of the Act; or

(ii)

on and from 1 June 2011 until the close of 1 December 2015, from—

(A)

calculating its risk-weighted amount for credit risk in accordance with regulation 11 of the Regulations; and

(B)

the related party exposures limit requirement in regulation 23(3)(b) of the Regulations.

10 Further condition of exemption in clause 7

The exemption in clause 7 is subject to the further condition that, for the purposes of calculating its capital ratio under regulation 9(1)(a) of the Regulations, UDC’s risk-weighted amount for credit risk is calculated in accordance with ANZN’s capital calculation model, as approved by the Bank.

11 Further condition of exemption in clause 8(3)

The exemption in clause 8(3) is subject to the further condition that, on and from 1 June 2011, UDC’s aggregate exposures to related parties as a percentage of its capital do not exceed 75%.

Dated at Wellington this 24th day of November 2010.

Grant Spencer,
Deputy Governor.

Statement of reasons

This notice, which comes into force on 1 December 2010 and expires on the close of 1 December 2015, exempts UDC Finance Limited (UDC) and, in some cases, its trustee from the following sections of the Reserve Bank of New Zealand Act 1989 (the Act):

The notice also grants exemptions from the requirements of regulations 9(1), 11, and 23(3)(b) of the Deposit Takers (Credit Ratings, Capital Ratios, and Related Party Exposures) Regulations 2010 (clauses 7 and 8). The exemption from regulation 9(1) is limited in scope.

The exemptions in clauses 5, 6, and 8(1) and (2) apply until the close of 31 May 2011, and the exemptions in clauses 7 and 8(3) apply on and from 1 June 2011 until the expiry of the notice. The exemptions are subject to the conditions specified in clauses 9 to 11.

The Reserve Bank of New Zealand (the Bank), after taking into account the principles set out in section 157F of the Act and satisfying itself as to the matters set out in section 157G(2) of the Act, considers it appropriate to grant these exemptions because—

  • in respect of the exemptions expiring on 31 May 2011, the additional direct and indirect costs of complying with the governance, related party, and capital ratio requirements on a short-term basis are unduly onerous and burdensome in the circumstances:

  • in respect of the exemptions expiring on 1 December 2015, UDC is a wholly owned subsidiary of a New Zealand registered bank and is therefore subject to restrictions imposed on its parent under Part 5 of the Act that relate to capital and related party exposures. Imposing requirements relating to the same matters as those imposed under Part 5D is unduly onerous and burdensome in the circumstances:

  • these exemptions are dependent on the application of rules under Part 5 of the Act covering capital and related party exposures, which means the exemptions are consistent with the maintenance of a sound and efficient financial system:

  • the conditions attached to these exemptions ensure that the exemptions are not broader than reasonably necessary to address the matters that gave rise to the exemptions.

Issued under the authority of the Legislation Act 2012.

Date of notification in Gazette: 26 November 2010.

Reprints notes
1 General

This is a reprint of the Deposit Takers (UDC Finance Limited) Exemption Notice 2010 that incorporates all the amendments to that notice as at the date of the last amendment to it.

2 Legal status

Reprints are presumed to correctly state, as at the date of the reprint, the law enacted by the principal enactment and by any amendments to that enactment. Section 18 of the Legislation Act 2012 provides that this reprint, published in electronic form, has the status of an official version under section 17 of that Act. A printed version of the reprint produced directly from this official electronic version also has official status.

3 Editorial and format changes

Editorial and format changes to reprints are made using the powers under sections 24 to 26 of the Legislation Act 2012. See also http://www.pco.parliament.govt.nz/editorial-conventions/.

4 Amendments incorporated in this reprint

Deposit Takers (UDC Finance Limited) Exemption Notice 2010 (SR 2010/444): clause 3