Executive Council has today, on my recommendation, approved banking authorities for the AMP Group and Rothschild Group.

Each of these authorities have been granted on a basis made possible by the Australian Financial System Reforms announced by the Government on 2 September 1997. I confirmed yesterday that legislation for these reforms will be introduced to Parliament in the current Sittings.

Both AMP and Rothschild will be adopting non-operating holding company structures for which the new regulatory arrangements will make specific provision. Each Group will be supervised by the Reserve Bank under interim arrangements until the enactment of the new arrangements.

The granting of the authorities and the associated approval of the shareholding arrangements for each group reflect the new licencing flexibilities and emphasis on enhancing competition in the banking sector that are hallmarks of the Government’s financial system reforms.

In the past, non-operating holding company structures generally have not been permitted where financial conglomerates contain a bank.

The authority for AMP is expected to take effect from 10 April 1998 and that for Rothschild from 1 April 1998.

18 March 1998

Contact: Ruth Gabbitas 02 6263 2895