Pursuant to section 6 of the Westpac New Zealand Act 2006, His Excellency the Governor-General, acting on the advice and with the consent of the Executive Council, and on the advice of the Minister of Finance (given in accordance with a recommendation of the Reserve Bank of New Zealand), makes the following order.

1 Title

2 Commencement

3 Proposal approved

Schedule
Proposal Between Westpac Banking Corporation and Westpac New Zealand Limited

Order

1 Title

This order is the Westpac New Zealand Proposal Approval Order 2006.

2 Commencement

This order comes into force on 31 October 2006.

3 Proposal approved

The proposal set out in the Schedule is approved.

cl 3

PROPOSAL BETWEEN

WESTPAC BANKING CORPORATION

AND

WESTPAC NEW ZEALAND LIMITED

FOR THE VESTING OF ASSETS AND LIABILITIES OF WESTPAC BANKING CORPORATION’S NEW ZEALAND RETAIL BANKING BUSINESS IN WESTPAC NEW ZEALAND LIMITED

1. Background

This proposal has been prepared in accordance with section 6 of the Westpac New Zealand Act 2006 for the purpose of providing for the vesting of certain assets and liabilities of Westpac Banking Corporation, being principally assets and liabilities of Westpac Banking Corporation’s New Zealand retail banking business, in Westpac New Zealand, a company incorporated in New Zealand, in order to comply with the local incorporation policy of the Reserve Bank of New Zealand.

2. Definitions

(1) In this proposal, unless the context otherwise requires,—

Account Code means a code number allocated to entries in the General Ledger as a means of classifying accounting entries under the headings “assets”, “liabilities”, “equity”, “off-balance sheet items”, “income”, and “expenses”

Act means the Westpac New Zealand Act 2006

Business Banking means the financial services provided by the New Zealand branch of Westpac Banking Corporation in relation to small, medium, and corporate business customers, agricultural businesses, property investment and development customers, and domestic transaction banking services for government departments, together with the “assets”, “liabilities”, “equity”, “off-balance sheet items”, “income”, and “expenses” which are recorded against Account Codes within the Cost Centres comprising Cost Centre RFSCOM (Business), but excluding Cost Centre 282676 (WIB Income Centre - Business)

Consumer Banking means the financial services provided by the New Zealand branch of Westpac Banking Corporation in relation to consumers, together with the “assets”, “liabilities”, “equity”, “off-balance sheet items”, “income”, and “expenses” which are recorded against Account Codes within the Cost Centres comprising Cost Centres RFSCNR (Consumer Banking – Total) and HOUSEC (NZ Head Office – Securitisation Total), but excluding Cost Centre 285070 (WIB Income Centre - Consumer)
Corporate Support means the marketing, products, project management, financial, tax, legal, human resources, communications, credit, risk, information technology, operations, property, collections, asset management, procurement, call centre, and related services performed by the New Zealand branch of Westpac Banking Corporation for the business units providing Business Banking and Consumer Banking services, together with the “assets”, “liabilities”, “equity”, “off-balance sheet items”, “income”, and “expenses” which are recorded against Account Codes within the following Cost Centres—
- (a) Cost Centre RBRKMG (NZ Risk Management); and
- (b) Cost Centre CFOTOT (Chief Financial Officer), but excluding Cost Centre HOUCAP (NZ Head Office Capital) and Cost Centre 284533 (WBCNZ Tax & I/G Balances); and
- (c) Cost Centre HRSTOT (People & Performance); and
- (d) Cost Centre PRDMKT (Marketing & Products); and
- (e) Cost Centre RFSCAF (Corporate Affairs); and
- (f) Cost Centre RFBTSS (Business & Technology Solutions & Services); and
- (g) Cost Centre ITCTOT (ITC Total); and
- (h) Cost Centre 280004 (NZ Projects); and
- (i) Cost Centre 284620 (NZ Decision Support); and
- (j) Cost Centre 508106 (NZ Incorporation); and
- (k) Cost Centre 284804 (WNZL Cash Branch)
Cost Centre means a combination of six alphanumeric characters allocated in the General Ledger to a business unit or part of a business unit in Westpac Banking Corporation, or one or more of its subsidiary or associated companies, within which accounting entries are grouped according to Account Codes
Customer Relationship means, in relation to a customer,—
- (a) the relationship (including all legal incidents of that relationship) between Westpac Banking Corporation and the customer in relation to each relevant Financial Asset, Deposit and Liability, Wholesale and Foreign Currency Deposit, or service; and
- (b) any relationship (including all legal incidents of any such relationship) between Westpac Banking Corporation and any other person that relates to the relationship between Westpac Banking Corporation and the customer; and
- (c) all contracts, instruments, documents, and information relating to any of the relationships referred to in paragraphs (a) and (b), including security interests (for the avoidance of doubt, as that term is defined in section 4 of the Act), insurance contracts, valuations, solicitors’ certificates, directors’ certificates, priority agreements, application forms, customer or guarantor information, mandates, account opening authorities, consents, authorisations, credit approvals, correspondence, diary notes, cheques, and debit cards
Deposits and Liabilities means the deposits and other liabilities which are recorded against Account Codes 200000 to 299999 within Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services and includes deposits and liabilities such as cheque accounts, call deposits, certificates of deposit, savings accounts, term deposits, ready access deposits, multiple deposit schemes, and solicitors’ trust accounts

Employment Agreements means the employment agreements for all staff listed on any of the payroll schedules for the business units providing Business Banking, Consumer Banking, or Corporate Support services
Financial Assets means all—
- (a) loans (including housing loans, personal loans, business loans, overdrafts, term loans, credit cards, and multiple advance loans) which are recorded as “Gross Loans” against Account Codes 146200 to 147020, together with all accrued interest receivable in respect of those gross loans and recorded against Account Codes 181010 to 181900, together with all fair value adjustments in respect of those gross loans and recorded against Account Codes 148001 to 148007; and
- (b) provisions for impairment losses on loans recorded against Account Codes 150055 to 150156; and
- (c) trading securities (including NZ Government Stock and NZ Treasury Bills) which are recorded as “Trading Securities” against Account Codes 125010 to 126060; and
- (d) securities sold but not yet delivered which are recorded against Account Code 171200; and
- (e) amounts due from other financial institutions which are recorded against Account Codes 116400 to 116810,
within the Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services
General Ledger means the record of accounting entries relating to Westpac Banking Corporation and its subsidiary and associated companies contained on its Oracle general ledger system

Intellectual Property Rights means all patents, designs, copyright, know-how, trade secrets, and other intellectual or industrial property rights of any kind (whether enforceable by any Act or rule of law) that relate exclusively to one or more of Business Banking, Consumer Banking, or Corporate Support services, but excluding trade marks, service marks, and domain names
Interests in Land means all estates or interests in land—
- (a) that are used by the New Zealand branch of Westpac Banking Corporation in providing Business Banking, Consumer Banking, or Corporate Support services; and
- (b) that are recorded against Account Codes 165100 to 166320 within the Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services,
whether or not described in Westpac Banking Corporation’s property register
Personal Property means all vehicles, fixtures, fittings, plant, equipment, and machinery (which, to avoid doubt, includes all computing and information technology hardware)—
- (a) that are used by the New Zealand branch of Westpac Banking Corporation in providing Business Banking, Consumer Banking, or Corporate Support services; and
- (b) that are recorded against Account Codes 166500 to 167440 within the Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services,
whether or not described in Westpac Banking Corporation’s fixed asset register
Specified Time means 12.01 am on the Appointed Day

Vested Contracts means all Westpac Banking Corporation’s contracts described in Westpac Banking Corporation’s contract register as allocated to the business units providing Business Banking, Consumer Banking, or Corporate Support services, and all other contracts relating exclusively to Business Banking, Consumer Banking, or Corporate Support services
Vested Litigation means all claims, actions, arbitrations, or proceedings, whether existing, pending, or historic, and including decisions and judgments,—
- (a) that are described as “vesting” in Westpac Banking Corporation’s litigation register; or
- (b) to the extent that they relate to one or more of the business units providing Business Banking, Consumer Banking, or Corporate Support services, unless they are described as “not vesting” in Westpac Banking Corporation’s litigation register
Wholesale and Foreign Currency Deposits means a foreign currency account, retail fixed term foreign currency deposit, or call or fixed term New Zealand dollar money market account (and all accrued interest on any such account or deposit) held with Westpac Banking Corporation by a person liable or owed an obligation in respect of one or more Financial Assets (other than credit cards) or Deposits and Liabilities immediately before the Specified Time.
(2) Unless the context otherwise requires, any term or expression that is defined in the Act and used, but not defined, in this proposal has the same meaning as in the Act.
(3) In this proposal—
- (a) headings are inserted for convenience only and do not affect interpretation of this proposal; and
- (b) unless the context otherwise requires, the singular includes the plural and vice versa and words denoting individuals include other persons and vice versa; and
- (c) a reference to any legislation includes a reference to any statutory regulations, rules, orders or instruments made or issued pursuant to that legislation and any amendment to, or re-enactment or replacement of, that legislation; and
- (d) a reference to any document includes a reference to that document as modified, novated, supplemented, varied, or replaced from time to time; and
- (e) a reference to any party to any document includes a reference to that party’s successors and permitted assigns; and
- (f) a reference to a time of day is a reference to New Zealand time.

3. Appointed day and time of vesting

(1) The Appointed Day is 1 November 2006.

(2) The Designated Assets and Liabilities are to vest in Westpac New Zealand at the Specified Time.

4. Description of Designated Assets and Liabilities

(1) The Designated Assets and Liabilities are all rights and obligations of Westpac Banking Corporation immediately before the Specified Time in respect of the following:
- (a) all assets and liabilities recorded against Account Codes 100000 to 299999 and 900000 to 999999 within the Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services, including—
  - (i) the Financial Assets; and
  - (ii) the Deposits and Liabilities; and
  - (iii) the Interests in Land; and
  - (iv) the Personal Property; and
- (b) all Wholesale and Foreign Currency Deposits; and
- (c) the following assets and liabilities—
  - (i) all Customer Relationships relating to each customer that has been, is, or may in the future be liable, or owed an obligation, in respect of one or more Financial Assets or Deposits and Liabilities or Wholesale and Foreign Currency Deposits, or that otherwise acquires, has acquired, or may in the future acquire Business Banking or Consumer Banking services; and
  - (ii) the Vested Contracts; and
  - (iii) the Intellectual Property Rights; and
  - (iv) the Employment Agreements; and
  - (v) all goodwill recorded against Account Codes 168015 and 168515 within the Cost Centres for the business units providing Business Banking, Consumer Banking, or Corporate Support services; and
  - (vi) all professional advice provided to Westpac Banking Corporation prior to the Specified Time, whether or not provided by third parties, to the extent that it relates to Business Banking, Consumer Banking, or Corporate Support services; and
  - (vii) the Vested Litigation; and
  - (viii) all goodwill and trade reputation attached to Westpac Banking Corporation’s New Zealand retail banking business not already included in subparagraphs (i) to (vii), but excluding the goodwill and trade reputation attached to any of Westpac Banking Corporation’s trade marks, service marks, and domain names; and
- (d) all Business Banking, Consumer Banking, or Corporate Support loans which at the Specified Time have been written off and removed from the General Ledger due to their classification as bad debts.
(2) The assets and liabilities referred to in subclause (1)(c) form part of the goodwill and trade reputation attached to Westpac Banking Corporation’s New Zealand retail banking business.

(3) Subclause (1) applies to any rights and obligations of Westpac Banking Corporation of any kind, whether arising from, accruing under, created or evidenced by, or the subject of, an instrument or otherwise, and whether liquidated or unliquidated, actual, contingent, or prospective.

5. Consideration payable by Westpac New Zealand

(1) The consideration payable by Westpac New Zealand for the Designated Assets and Liabilities must be calculated in accordance with the following formula:
a - b

where—
- a is the aggregate of each balance at the Specified Time recorded against the relevant Account Codes for the assets or classes of assets vesting in Westpac New Zealand, reduced, where applicable, by the balance of any provision recorded against one or more Account Codes in respect of those assets or classes of assets
- b is the aggregate of each balance at the Specified Time recorded against the relevant Account Codes for the liabilities or classes of liabilities vesting in Westpac New Zealand (excluding Wholesale and Foreign Currency Deposits), and of each Wholesale and Foreign Currency Deposit.
(2) The consideration calculated in accordance with subclause (1) is payable to Westpac Banking Corporation.

Dated this 13th day of September 2006

Signed on behalf of Westpac Banking Corporation
by David Morgan
Chief Executive of Westpac Banking Corporation

[D R Morgan]

Signed on behalf of Westpac New Zealand Limited
by Ann Sherry
Chief Executive of Westpac New Zealand Limited

[A C Sherry]

Rebecca Kitteridge,
for Clerk of the Executive Council.

Explanatory note

This note is not part of the order, but is intended to indicate its general effect.

This order, which comes into force on 31 October 2006, approves a proposal that has been prepared in accordance with the Westpac New Zealand Act 2006. The proposal describes the assets and liabilities of Westpac Banking Corporation that are to vest in Westpac New Zealand Limited. It also records that the day of vesting (referred to in the Westpac New Zealand Act 2006 as the appointed day) is 1 November 2006. The proposal was signed on behalf of Westpac Banking Corporation and Westpac New Zealand Limited on 13 September 2006.

Issued under the authority of the Acts and Regulations Publication Act 1989.

Date of notification in Gazette: 5 October 2006.

1General
2Status of reprints
3How reprints are prepared
4Changes made under section 17C of the Acts and Regulations Publication Act 1989
5List of amendments incorporated in this reprint (most recent first)

Notes

1 General

This is a reprint of the Westpac New Zealand Proposal Approval Order 2006. The reprint incorporates all the amendments to the Westpac New Zealand Proposal Approval Order 2006 as at 6 October 2006, as specified in the list of amendments at the end of these notes.

Relevant provisions of any amending enactments that have yet to come into force or that contain relevant transitional or savings provisions are also included, after the principal enactment, in chronological order.

2 Status of reprints

Under section 16D of the Acts and Regulations Publication Act 1989, reprints are presumed to correctly state, as at the date of the reprint, the law enacted by the principal enactment and by the amendments to that enactment. This presumption applies even though editorial changes authorised by section 17C of the Acts and Regulations Publication Act 1989 have been made in the reprint.

This presumption may be rebutted by producing the official volumes of statutes or statutory regulations in which the principal enactment and its amendments are contained.

3 How reprints are prepared

A number of editorial conventions are followed in the preparation of reprints. For example, the enacting words are not included in Acts, and provisions that are repealed or revoked are omitted. For a detailed list of the editorial conventions, see http://www.pco.parliament.govt.nz/legislation/reprints.shtml or Part 8 of the Tables of Acts and Ordinances and Statutory Regulations, and Deemed Regulations in Force.

4 Changes made under section 17C of the Acts and Regulations Publication Act 1989

Section 17C of the Acts and Regulations Publication Act 1989 authorises the making of editorial changes in a reprint as set out in sections 17D and 17E of that Act so that, to the extent permitted, the format and style of the reprinted enactment is consistent with current legislative drafting practice. Changes that would alter the effect of the legislation are not permitted.

A new format of legislation was introduced on 1 January 2000. Changes to legislative drafting style have also been made since 1997, and are ongoing. To the extent permitted by section 17C of the Acts and Regulations Publication Act 1989, all legislation reprinted after 1 January 2000 is in the new format for legislation and reflects current drafting practice at the time of the reprint.

In outline, the editorial changes made in reprints under the authority of section 17C of the Acts and Regulations Publication Act 1989 are set out below, and they have been applied, where relevant, in the preparation of this reprint:
- •omission of unnecessary referential words (such as “of this section” and “of this Act”)
- •typeface and type size (Times Roman, generally in 11.5 point)
- •layout of provisions, including:
  - •indentation
  - •position of section headings (eg, the number and heading now appear above the section)
- •format of definitions (eg, the defined term now appears in bold type, without quotation marks)
- •format of dates (eg, a date formerly expressed as “the 1st day of January 1999” is now expressed as “1 January 1999”)
- •position of the date of assent (it now appears on the front page of each Act)
- •punctuation (eg, colons are not used after definitions)
- •Parts numbered with roman numerals are replaced with arabic numerals, and all cross-references are changed accordingly
- •case and appearance of letters and words, including:
  - •format of headings (eg, headings where each word formerly appeared with an initial capital letter followed by small capital letters are amended so that the heading appears in bold, with only the first word (and any proper nouns) appearing with an initial capital letter)
  - •small capital letters in section and subsection references are now capital letters
- •schedules are renumbered (eg, Schedule 1 replaces First Schedule), and all cross-references are changed accordingly
- •running heads (the information that appears at the top of each page)
- •format of two-column schedules of consequential amendments, and schedules of repeals (eg, they are rearranged into alphabetical order, rather than chronological).

5 List of amendments incorporated in this reprint (most recent first)

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