Trust Bank (Corporatisation) Act 1997
An Act to convert the Trust Bank into a public company limited by shares that is incorporated under the Corporations Law, to regulate the issue and ownership of those shares, to establish a body corporate to be the trustee of the Trust Bank Foundation, to provide for a Board of Directors of The Trustee of the Trust Bank Foundation to manage and control the administration of the Trust Bank Foundation and for related purposes
[Royal Assent 8 May 1997]
Be it enacted by His Excellency the Governor of Tasmania, by and with the advice and consent of the Legislative Council and House of Assembly, in Parliament assembled, as follows:
PART 1 - Preliminary
This Act may be cited as the Trust Bank (Corporatisation) Act 1997 .
This Act commences on the day on which this Act receives the Royal Assent.
(1) In this Act, unless the contrary intention appears –approved corporation means a corporation approved by the Treasurer of the Commonwealth for the purposes of this Act;articles means articles of association;Bank means –(a) where the expression is used in relation to a time before the conversion day, the Trust Bank; or(b) where the expression is used in relation to a later time, Trust Bank Limited;Banks (Shareholding) Act means the Banks (Shareholding) Act 1972 of the Commonwealth;conversion day means the day declared under section 6 to be the conversion day for the purposes of this Act;employee, in relation to the Bank, means a person employed, whether on a full-time or part-time basis, by the Bank or a subsidiary of the Bank, and includes a director of the Bank or of such a subsidiary who holds a salaried employment or office in the Bank or in such a subsidiary;general council, in relation to the Bank at a time before the conversion day, means the general council of the Bank under the Trustee Banks Act 1985 ;memorandum means memorandum of association;new trust deed means any trust deed that –(a) is executed by the Trust Bank after this Act receives the Royal Assent and before the conversion day; and(b) inserts provisions in the original trust deed in substitution for the provisions of that trust deed; and(c) is in substantial accordance with a form of deed that the Minister caused to be laid before each House of Parliament before this Act received the Royal Assent;offer document means a document containing an offer made under section 13(2) ;original trust deed means the deed containing a Declaration of Trust that was executed by the Trust Bank on 26 October 1985 and the deeds of variation of that Declaration of Trust that were executed by the Trust Bank on 7 December 1989 and 17 December 1991;relevant trust provisions means –(a) the provisions inserted by the new trust deed in the original trust deed; or(b) if any of the inserted provisions are afterwards amended or replaced by another trust deed or other trust deeds, the inserted provisions as amended or replaced;strategic partner means an approved corporation that has entered into a strategic partnership agreement;strategic partnership agreement means an agreement made between the Bank and an approved corporation as mentioned in section 12(1) ;share, in relation to the Bank, means a share in the capital of the Bank;The Trustee of the Trust Bank Foundation means the body corporate established under section 17 ;Trust Bank means the body corporate of that name in existence immediately before the commencement of this Act under the Trustee Banks Act 1985 ;Trust Bank Foundation means –(a) where the expression is used in relation to a time before the conversion day, the trusts established under the original trust deed; or(b) where the expression is used in relation to a later time, the trusts established under the relevant trust provisions;Trust Bank Limited means the company that is taken by section 9 to be registered under the Corporations Law.(2) The question whether a person has an interest in a share is to be determined in the same way as that question would be determined under the Banks (Shareholding) Act.
This Act binds the Crown in right of Tasmania and, so far as the legislative power of Parliament permits, in all its other capacities.
5. Act to have effect despite Corporations (Tasmania) Act and Corporations Law
This Act has effect despite any provision of the Corporations (Tasmania) Act 1990 or the Corporations Law.
The Minister may, by notice published in the Gazette, declare a day named in the notice (being not later than 4 years after the commencement of this Act) to be the conversion day for the purposes of this Act.
PART 2 - Conversion of Trust Bank into a company
7. Application for registration of Bank as a company
(1) Before the conversion day, the Trust Bank –(a) is to apply to the Australian Securities Commission under section 133 of the Corporations Law for the Bank to be registered as a company limited by shares within the meaning of the Corporations Law; and(b) is to apply to the Australian Securities Commission under section 374 of the Corporations Law for reservation of the name "Trust Bank Limited"; and(c) is to lodge with the Australian Securities Commission a proposed memorandum and proposed articles for the Bank.(2) The proposed memorandum is to provide for only one class of shares.(3) Sections 134, 135 and 136(1)(a), (b), (c), (d)(ii) and (iii) and (f) of the Corporations Law do not apply in relation to the application mentioned in subsection (1)(a) of this section.(4) The application mentioned in subsection (1)(a) is to be accompanied by a statement setting out the names, addresses and occupations of the directors and principal officers of the Bank and the address of the Bank’s principal office.(5) The Bank is to deliver the applications and accompanying statement to an office of the Australian Securities Commission in the State.(6) The Bank is taken to be entitled to make the applications, and to lodge the documents, mentioned in subsections (1) and (4) .(7) The name "Trust Bank Limited" is taken to have been reserved under section 374 of the Corporations Law immediately after lodgment of the application referred to in subsection (1)(b) .(8) Nothing in subsections (1) to (7) prevents –(a) a variation of the share capital of the Bank; or(b) a change in the name of the Bank; or(c) a change in the structure, memorandum, articles or membership of the Bank.
(1) The proposed articles must include –(a) a provision requiring the Bank to be at all times incorporated in the State; and(b) a provision requiring the Bank to carry on in the State a banking business of substantially the same type as, and on a scale not significantly smaller than, the banking business carried on by it immediately before the conversion day; and(c) a provision requiring the place where the policy of the Bank is determined, and the control of the Bank is exercised, to be in the State; and(d) a provision requiring at least a majority of the directors to be persons who are ordinarily resident in the State; and(e) a provision prohibiting the alteration of any of the provisions included in the articles under paragraph (a) , (b) , (c) or (d) or this paragraph.(2) If a provision included in the articles otherwise than in accordance with subsection (1) is inconsistent with a provision included in the articles in accordance with that subsection, the first-mentioned provision is, to the extent of the inconsistency, of no effect.
9. Registration of Bank as a company
On the conversion day –(a) the application mentioned in section 7(1)(a) is taken to have been granted; and(b) the Trust Bank is taken to have been registered –(i) by the name "Trust Bank Limited"; and(ii) in accordance with section 137(3) and (5) of the Corporations Law, as a public company, and as a company limited by shares, within the meaning of the Corporations Law; and(c) the name "Trust Bank Limited" is taken to have been registered in relation to the Trust Bank under section 374(5) of the Corporations Law.
(1) On and after the conversion day, the proposed memorandum, and proposed articles, lodged under section 7 –(a) are the memorandum and articles of the Bank; and(b) bind the Bank and its members accordingly.(2) On and after the conversion day, the Corporations Law applies in relation to the Bank’s memorandum and articles as if they had been registered as such under the Corporations Law.
PART 3 - Shares
(1) This section has effect subject to the Banks (Shareholding) Act.(2) Subject to the following provisions of this section, the Bank may, on the conversion day, issue such number of its shares as it thinks appropriate in order to carry out the purposes of this Act.(3) If, on the conversion day, the Bank’s shares have a par value –(a) the Board of Directors of the Bank is to fix a nominal value for each of its shares; and(b) all shares issued on that day are taken to have been fully paid up.(4) If, on the conversion day, the Bank’s shares do not have a par value –(a) the Board of Directors of the Bank is to determine an issue price for each of its shares that are to be issued on that day; and(b) the issue price of all the shares so issued is taken to have been paid in full.(5) The number of shares to be issued under subsection (2) on the conversion day is not to exceed the number which, if issued, would result in –exceeding the prescribed maximum amount.(a) if subsection (3) applies, the sum of the paid-up values of the shares so issued; or(b) if subsection (4) applies, the sum of the amounts taken to have been paid for the shares –(6) The prescribed maximum amount for the purposes of subsection (5) is the sum of –(a) the total amount of the Bank’s reserves as shown in the Bank’s balance sheet as at the end of the last financial year that ended before the conversion day; and(b) $10 000 000.(7) If a strategic partnership agreement is in force immediately before the conversion day –(a) 16% of the shares to be issued on that day are to be issued to the State; and(b) 84% of the shares to be issued on that day are to be issued to The Trustee of the Trust Bank Foundation.(8) If no strategic partnership agreement is in force immediately before the conversion day, all the shares to be issued on that day are to be issued to The Trustee of the Trust Bank Foundation.
12. What happens if a strategic partnership agreement has been entered into
(1) This section applies if, within 2 years after the commencement of this Act or within such further period as the Minister allows, an agreement is made with the approval of the general council of the Bank between the Bank and an approved corporation under which –(a) the strategic partner agrees, on the terms (including the terms relating to price) set out in the agreement –(i) to buy from the State all the shares in the Bank that are to be issued to the State under section 11(7)(a) ; and(ii) to buy from The Trustee of the Trust Bank Foundation the prescribed number of the shares in the Bank that are to be issued to The Trustee of the Trust Bank Foundation under section 11(7)(b) ; and(b) the strategic partner agrees that it will not, without the written consent of the Minister, at any time have, or do anything (whether in or outside the State) that would result in any other person having –(i) if the Bank’s shares have a par value, an interest in one or more of the issued shares in the Bank the nominal value, or the sum of the nominal values, of which would exceed 49% of the total of the nominal values of all the issued shares in the Bank; or(ii) if the Bank’s shares do not have a par value, an interest in more than 49% of the issued shares in the Bank.(2) The prescribed number of shares mentioned in subsection (1)(a)(ii) is such number of shares as, when taken together with the shares mentioned in subsection (1)(a)(i) , will constitute 49% of the issued shares in the Bank.(3) In seeking an approved corporation to be the strategic partner, and in negotiating the terms of the sale of shares by the State and The Trustee of the Trust Bank Foundation to the strategic partner, the Board of Directors of the Bank is to act commercially and with probity and take into account the following:(a) the need to obtain the best possible price for the sale of the shares by the State to the strategic partner;(b) the need to obtain the best possible price for the sale of the shares by The Trustee of the Trust Bank Foundation to the strategic partner;(c) the interests of the Bank and the State in preserving the identity and business of the Bank as the premier financial institution in the State;(d) the interests of the employees of the Bank in ensuring that their employment prospects are not adversely affected and adequate provision will exist for opportunities to enhance their career opportunities as employees of the Bank;(e) the extent to which the strategic partner will bring technological, intellectual and other skills to the Bank that will enhance the interests referred to in paragraphs (c) and (d) and the value of any shares in the Bank sold by The Trustee of the Trust Bank Foundation to persons other than the strategic partner;(f) the extent to which the credit rating of the Bank will be enhanced by the acquisition of the shares in the Bank by the strategic partner;(g) the extent to which any business carried on by the strategic partner will enhance the operations and future viability of the Bank as a strong Australian financial institution based in Tasmania;(h) the extent to which the ownership of shares in the Bank by the strategic partner is capable of strengthening the Bank in a competitive financial environment;(i) the extent to which the appointment to the Board of Directors of the Bank of persons nominated by the strategic partner will widen the collective expertise of the Board.(4) The State and The Trustee of the Trust Bank Foundation may enforce compliance by the strategic partner with the strategic partnership agreement as if they were parties to that agreement.(5) On the issue of the shares in the Bank to the State in accordance with section 11(7)(a) –(a) the liability of the Bank to make any payment to the Treasurer under the special capital note on issue by the Bank to the State is released; and(b) the special capital note is cancelled and the Bank’s reserves are increased by the face value of the note.(6) On the conversion day and after the issue of the shares in the Bank in accordance with section 11(7) –(a) the State is to sell to the strategic partner all the shares referred to in subsection (1)(a)(i) ; and(b) The Trustee of the Trust Bank Foundation is to sell to the strategic partner the prescribed number of shares referred to in subsection (1)(a)(ii) .(7) The amount received by the State from the strategic partner for the sale of the shares under subsection (6)(a) is to be paid into an account established in the Special Deposits and Trust Fund and is to be applied in retirement of State debt.(8) As soon as practicable after the sales of the shares mentioned in subsection (6) , The Trustee of the Trust Bank Foundation is to offer for sale to the public in accordance with Division 2 of Part 7.12 of the Corporations Law, by such method, and at such price and on such other terms and conditions, as its Board of Directors thinks appropriate, such number of the shares in the Bank retained by it as constitute 41% of the issued shares in the Bank.
13. What happens if a strategic partnership agreement is not entered into
(1) If the Board of Directors of the Bank resolves that the Bank is unable to enter into an agreement referred to in section 12(1) within the period applicable under that section –(a) the Board is immediately to give written notice of the resolution to the Treasurer; and(b) on the giving of the notice, the following provisions of this section have effect.(2) Not later than 4 years after the commencement of this Act, the Bank is to make written offers for the sale to the public, at such price and on such other terms and conditions as its Board of Directors thinks appropriate, of 90% of the shares in the Bank that are to be issued in accordance with section 11(8) on the conversion day.(3) An offer document is to state that –(a) the shares to which it relates will first be issued to The Trustee of the Trust Bank Foundation; and(b) the purchase price for the shares is to be paid to The Trustee of the Trust Bank Foundation; and(c) The Trustee of the Trust Bank Foundation will transfer the shares on the conversion day to the persons agreeing to buy them.(4) For the purposes of the Corporations Law –(a) each offer document is taken to be a prospectus issued by the Bank; and(b) the persons accepting the offers are taken to be subscribers for the shares.(5) In determining the date on which offer documents are to be issued, the Bank is to take competent independent advice with a view to maximising the return from the sale of the shares.(6) The Bank is to ensure that the sale of the shares is underwritten by one or more underwriting agreements so that all the shares will be sold.(7) The Trustee of the Trust Bank Foundation may enforce any agreement to buy the shares pursuant to acceptance of an offer contained in an offer document, and any underwriting agreement entered into as mentioned in subsection (6) , as if it were a party to the agreement concerned.(8) Immediately after all the shares are sold, whether by the acceptance of the offers contained in offer documents or under an underwriting agreement, the Bank is to notify the Minister in writing.(9) On receiving the notification, the Minister is to declare, under section 6 , a day to be the conversion day for the purposes of this Act.(10) As soon as practicable after the shares in the Bank are issued to The Trustee of the Trust Bank Foundation, The Trustee of the Trust Bank Foundation is to transfer the shares to the persons who have agreed to buy them and paid the purchase price to The Trustee of the Trust Bank Foundation.(11) The Trustee of the Trust Bank Foundation is to pay to the State, out of the proceeds of the sales, an amount equal to 16% of the amount that would have been received by The Trustee of the Trust Bank Foundation if the offers had related to all the shares in the Bank to be issued under section 11(8) and all those shares had been sold pursuant to the offers.(12) On payment of the amount payable under subsection (11) –(a) the liability of the Bank to make any payment to the Treasurer under the special capital note on issue by the Bank to the State is released; and(b) the special capital note is cancelled and the Bank’s reserves are increased by the face value of the note.(13) The amount paid by The Trustee of the Trust Bank Foundation to the State under subsection (11) is to be paid into an account established in the Special Deposits and Trust Fund and is to be applied in retirement of State debt.
14. Initial share capital of Bank
The share capital of the Bank immediately after the issue of the shares under section 11 is so much of the Bank’s reserves (including the increase in those reserves effected by section 12(5)(b) or 13(12)(b) ) on that day as is equal to the amount obtained by multiplying the paid-up value or issue price, as the case may be, of each of the shares by the number of shares issued.
15. Bank not required to hold statutory meeting or send statutory report under Corporations Law
Section 244 of the Corporations Law (which relates to the holding of a statutory meeting and the sending of a statutory report) does not apply to the Bank.
16. Loans to employees for acquisition of shares in Bank
(1) The Bank may lend money to employees, on such terms, and on such security, as the Board of Directors of the Bank thinks fit, to enable the employees to buy shares in the Bank.(2) Section 205 of the Corporations Law does not apply in relation to the making of loans under subsection (1) in respect of the purchase of shares offered for sale under section 12(8) or 13(2) .(3) The total number of shares in respect of which the Bank may lend money under subsection (1) is not to exceed 5% of the number of issued shares in the Bank.
PART 4 - The Trust Bank Foundation
17. Establishment of body corporate
(1) A body corporate is established for the purposes of this Part.(2) The body corporate –(a) is to be known as "The Trustee of the Trust Bank Foundation"; and(b) is to have a seal; and(c) may acquire, hold, and dispose of, real and personal property; and(d) may sue and be sued.(3) On and after the conversion day, The Trustee of the Trust Bank Foundation is to be the trustee of the Trust Bank Foundation under the new trust deed for the purposes of the relevant trust provisions.(4) The provisions of the new trust deed relating to the vesting of assets in, and the imposing of liabilities on, The Trustee of the Trust Bank Foundation have effect according to their terms.
18. Board of Directors of The Trustee of the Trust Bank Foundation
(1) A Board of Directors of The Trustee of the Trust Bank Foundation is established.(2) The function of the Board is to manage and control the administration of the Trust Bank Foundation on and after the conversion day by The Trustee of the Trust Bank Foundation.(3) The provisions of the new trust deed relating to the first Directors have effect according to their terms.(4) Subject to subsection (3) , the relevant trust provisions apply in relation to the Board.(5) For the purposes of the performance of the Board’s function –(a) the Board has such powers as are conferred by the relevant trust provisions and also has any other necessary or convenient powers; and(b) anything done by the Board in the name of, or on behalf of, The Trustee of the Trust Bank Foundation is taken to have been done by The Trustee of the Trust Bank Foundation.(6) If the relevant trust provisions provide that the Supreme Court may –the Supreme Court has jurisdiction in the matter.(a) decide whether to approve a person as being a fit and proper person for appointment as a Director; or(b) remove a person from office as a Director; or(c) fix the remuneration of Directors –
PART 5 - Miscellaneous
(1) If the strategic partner breaches the term of the strategic partnership agreement referred to in section 12(1)(b) in relation to itself or another person, the Supreme Court may, on the application of the Minister or The Trustee of the Trust Bank Foundation, whether or not other proceedings in respect of the breach have been instituted, make one or more of the following orders:(a) an order restraining the exercise of any voting or other rights attached to any share in the Bank in which the strategic partner or other person has an interest;(b) an order directing the Bank not to make payment, or to defer making payment, of any sum due from the Bank in respect of any share in the Bank in which the strategic partner or other person has an interest;(c) an order directing the sale of all or any of the shares in the Bank in which the strategic partner or other person has an interest;(d) an order that any exercise of the voting or other rights attached to specified shares in the Bank in which the strategic partner or other person has, or has had, an interest be disregarded;(e) for the purpose of securing compliance with any other order made under this section, an order directing the Bank or any other person to do or refrain from doing a specified act.(2) An order under this section may include such ancillary or consequential provisions as the Supreme Court thinks just.(3) Before making an order under this section and in determining the terms of such an order, the Supreme Court is to satisfy itself, so far as it can reasonably do so, that the order would not unfairly prejudice any person.(4) The Supreme Court is not to make an order under subsection (1) , other than an order restraining the exercise of voting rights, if it is satisfied –(a) that the breach by the strategic partner mentioned in subsection (1) was due to its inadvertence or mistake or to its not being aware of a fact or occurrence the existence of which was necessary to constitute the breach; and(b) that, in all the circumstances, the breach ought to be excused.(5) The Supreme Court may, before making an order under this section, direct that notice of the application be given to such persons as it thinks fit or direct that notice of the application be published in such manner as it thinks fit, or both.(6) The Supreme Court may, by order, rescind, vary or discharge an order made by it under this section or suspend the operation of such an order.
The Bank –the Crown in right of Tasmania.(a) is not, and does not represent; and(b) is not an instrumentality or agency of; and(c) is not entitled to any immunity or privilege of –
21. Modification of Trust Bank (Arrangements) Act 1991
Section 15(1)(b) of the Trust Bank (Arrangements) Act 1991 has effect as if the reference in that section to such date as the Treasurer and Trust Bank agree were a reference to the conversion day.
On the conversion day, the following Acts are repealed:(a) Trustee Banks Act 1993;(b) Trustee Banks Amendment Act 1993;(c) Trustee Banks Amendment Act 1995;(d) Trust Bank (Arrangements) Act 1991.
The Governor may make regulations for the purposes of this Act.
Until provision is made in relation to this Act by order under section 4 of the Administrative Arrangements Act 1990 –(a) the administration of this Act is assigned to the Treasurer; and(b) the Department responsible to the Treasurer in relation to the administration of this Act is the Department of Treasury and Finance.
[Second reading presentation speech made in:
House of Assembly on 17 APRIL 1997
Legislative Council on 23 APRIL 1997]