Page 1725 - Week 06 - Thursday, 19 May 1994
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STATE BANK OF SOUTH AUSTRALIA
(TRANSFER OF UNDERTAKING) BILL 1994
MS FOLLETT (Chief Minister and Treasurer) (10.41): I present the State Bank of South Australia (Transfer of Undertaking) Bill 1994.
Title read by Clerk.
MS FOLLETT: I move:
That this Bill be agreed to in principle.
The State Bank of South Australia (Transfer of Undertaking) Bill 1994 is being introduced at the request of the South Australian Government as a complementary measure to legislation in that State. This Bill will facilitate the restructuring of the State Bank of South Australia. The State Bank is a statutory corporation formed under the State Bank of South Australia Act 1983 and conducts banking business in South Australia and also in the other States and Territories.
Members will recall that the bank's financial difficulties in 1991 necessitated the provision of a rescue package by the South Australian Government. In February 1993, the Prime Minister announced that the Commonwealth was prepared to provide special financial assistance to South Australia to help the State in reducing its current debt burden. In recognition of the Commonwealth's decision, the South Australian Premier agreed to recommend the sale of the State Bank as quickly as practicable consistent with achieving a fair market price.
To facilitate this sale, the South Australian Government has decided to corporatise the State Bank by transferring its banking business to a public company to be incorporated under the Corporations Law as the Bank of South Australia Ltd. This public company will initially be owned by the South Australian Government. At the same time, the State Bank of South Australia will change its name to the South Australian Asset Management Corporation. It will cease to conduct its banking business, but will continue in existence for a number of years in order to realise its remaining assets and pay off its outstanding liabilities.
A Bill to facilitate the corporatisation of the State Bank of South Australia was recently introduced into the South Australian Parliament. That Bill provides for the transfer of assets and liabilities from the State Bank and its subsidiaries to the Bank of South Australia Ltd. The Bill also refers power over the banking business to the Commonwealth so that the bank can come under the prudential supervision of the Reserve Bank as from 1 July 1994.
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