Page 161 - Week 01 - Tuesday, 12 February 1991

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CHIEF MINISTER FOR THE AUSTRALIAN CAPITAL TERRITORY

LEGISLATIVE ASSEMBLY QUESTION

Question No 319

Building Societies and Credit Unions - Prudential Requirements

MS FOLLETT - Asked the Treasurer upon notice on 13 December _990:

(1) What are the current prudential requirements in the ACT .o. Building Societies and for Credit Unions.

(2) How do these requirements compare with the requirements in each State and the Northern Territory. .

(3) Are there any proposals to change these requirements; and if so, what are the details:

MR KAINE - The answer to the members question is as follows:

(1) Requirements for building societies:

Capital adequacy

Designated capital, as-defined in section 14CG of the Co-operative Societies Act 1939, must be maintained at a level determined in accordance with a Reserve Bank risk-weighted model and must be a minimum of 3 per cent of assets at all times.

Net liquidity

There is no legal minimum for building societies but the Registrar imposes the same requirement as for credit societies. A society cannot approve a loan unless, at the time of approval, a society holds lieu of funds equal to not less than 10 per cent of the withdrawable funds of the society.

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