The Short Title of this Act is “The Banking Act, 1908.”

This Act is a consolidation of the enactments mentioned in the First Schedule hereto, and with respect to those enactments the following provisions shall apply:—

Savings.

In this Act, if not inconsistent with the context,—

All Royal charters and letters patent granted or to be granted by His Majesty to any bank shall to all intents and purposes be as effectual within New Zealand as Acts of the General Assembly thereof.

Notwithstanding anything in the charter of any bank incorporated in New Zealand, the number of the directors of such bank is hereby fixed at not less than five nor more than seven; and, in any case where the number is not in accordance with this provision, the directors of the bank are hereby authorised from time to time to fix the number so as to accord therewith.

Notwithstanding anything in any Act of the General Assembly of New Zealand relating to banks or in the charter of any bank incorporated in New Zealand and carrying on the business of banking only, the shareholders or proprietors thereof may from time to time by extraordinary resolution authorise its capital to be increased to such amount and upon such terms, and either with or without special privileges, preferences, and priorities to the holders of shares in such increased capital, as they may from time to time deem expedient, and the same may be increased accordingly.

Any extraordinary resolution as aforesaid may provide—

In any such case holders of shares in the increased capital shall be entitled to such privileges, preferences, and priorities, and to such exemption as aforesaid, in the manner and to the extent provided by the extraordinary resolution.

The increased capital may be raised by the issue of new shares of such amount as the shareholders or proprietors of the bank determine by any extraordinary resolution as aforesaid, and shall, except as provided by this Act and by any extraordinary resolution as aforesaid, be subject to the several provisions of the charter of the bank as if it had been part of the original capital.

A certificate in writing under the hand of the Chairman of the Board of Directors for the time being of the bank that any extraordinary resolution as aforesaid has been duly and lawfully passed, setting forth the terms thereof, shall be conclusive evidence for all purposes and against all persons that such resolution was duly and lawfully passed, and was in the terms set forth in such certificate, and it shall not be necessary to prove the signature or official position of the Chairman.

For the purposes of this section “extraordinary resolution” means a resolution passed in the manner in which an extraordinary resolution must be passed under the charter of the bank.

Notwithstanding anything in the charter of any bank, no transfer of shares of the hank on which there is any liability shall be complete or shall operate to vest those shares in any person, or to relieve the transferor from liability in respect thereof, until such transfer is approved of in writing by the directors of the bank.

This Act shall be sufficient authority to the directors to refuse their approval to any transfer of shares on which there is any liability, without assigning any reason therefor.

Provided that if the branch register upon which any such transfer is to be recorded is kept in any country other than the country in which the head office of the bank is situated, the directors of the bank may, if they think fit, delegate to a duly appointed attorney or attorneys, with power to act jointly or severally, the duty of approving or disapproving in writing such transfer and of registering the same upon such branch register, and the approval of such transfer by such attorney or attorneys shall take the place of the approval by the directors of the bank required by this or any other Act, and shall be as valid to complete any transfer of shares and to relieve the transferor from liability as if such transfer had been approved by the directors themselves.

Where any bank has before the coming into operation of this Act delegated to any attorney or attorneys the duty of approving or disapproving any such transfer and of registering the same upon any branch register, and such transfer has been approved by such attorney or attorneys and registered upon such branch register, such approval shall be as valid and effectual to complete such transfer and relieve the transferor from liability as if such transfer had been approved by the directors themselves before being registered.

A certificate under the hand of one or more of the directors of a bank, or under the hand of the attorney or attorneys of the bank, if purporting to be issued under the authority of this Act, specifying any shares held by any person, shall be conclusive proof of the title of such person to the shares therein specified.

The Governor may by Proclamation declare that any bank incorporated by Royal charter or letters patent, and empowered to carry on the business of banking in New Zealand, and to issue and circulate therein bank-notes of the bank, may lawfully issue and circulate such notes within New Zealand, but subject to the provisions and restrictions in such charter or letters patent contained.

All bank-notes of a bank heretofore or hereafter issued, circulated, or reissued in New Zealand by a bank under authority of this or any other Act of the General Assembly shall, to the amount of the issue authorised, be a first charge on all the property of that bank (including the paid-up capital, uncalled capital, and reserve fund), being assets for the payment of debts or other obligations contracted or entered upon, or due and payable in New Zealand; and shall be payable in gold only at the office of the bank at the place of issue of the said notes respectively, anything contained in any other Act notwithstanding.

Every person commits an offence, and is liable to a fine not exceeding five pounds, who,—

The indorsement of any bank-note for the purpose of identification or for any other lawful purpose is not an offence within the meaning of this section.

Every bank shall, at the dates and times hereinafter mentioned, prepare and make up returns in the form in the Second Schedule hereto, showing,—

Quarterly abstracts.

To each of such quarterly abstracts there shall be subjoined a statement showing the amount of capital of the bank paid up at the close of the quarter, the rate and amount of the last dividend declared to the shareholders or proprietors, and the amount of the reserved profit at the time of declaring that dividend.

As regards banks that carry on business beyond as well as in New Zealand, it shall be sufficient to state the same several particulars according to the latest advices received in New Zealand.

Such quarterly abstracts and statements shall be verified by the oath of the manager, or, in his absence, by the oath of the chief cashier or chief clerk of the bank at the place in respect of which the same are made, and shall be forthwith delivered or transmitted to the Minister of Finance, or to such other public officer as the Governor from time to time appoints.

In the case of each bank every such quarterly abstract and statement, or an abstract or statement compiled therefrom, including all the places of business in New Zealand of the bank in one abstract, shall be published as soon as conveniently may be in the Gazette.

Every bank that neglects to keep the weekly accounts and statements, or to make out and deliver or transmit within twenty-one days after the termination of any quarter the quarterly abstracts and statements hereinbefore mentioned, is liable to a fine of five hundred pounds.

In any prosecution for any fine under this section the burden of proving that such weekly accounts and statements have been kept, or, as the case may be, that such quarterly abstracts and statements have been made out and delivered or transmitted, shall be on the bank.

Every manager, chief cashier, or clerk of a bank who, knowing any such abstract or statement to be false in any particular, verifies the same, or is concerned in delivering or transmitting the same as aforesaid, is liable to a fine of one hundred pounds.

Every fine imposed by this or the last preceding section shall be recovered only by action in the Supreme Court in the manner provided by “The Crown Suits Act, 1908”; and no action therefor shall lie unless the same is commenced within two years from the time the offence is alleged to have been committed.

Every oath required to be taken under this Act may be taken before any Justice.

The Governor may from time to time as he thinks fit, by warrant gazetted, vary for every or any bank at every or any place within New Zealand the several days and times appointed for the making and preparation of the above-mentioned accounts and statements and abstracts respectively:

Provided that such accounts and statements and abstracts made and prepared in any one year shall not be less in number than are prescribed by this Act, and shall be made and prepared at regular intervals of time.

Subject to the provisions of this section, a copy of any entry in the books of a bank shall in all legal proceedings be received as prima facie evidence of such entry, and of the matters, transactions, and accounts therein recorded.

Such copy shall not be received in evidence under this Act unless it is first proved—

Ibid, sec. 5

Any affidavit for the purposes of this section may be sworn before any person authorised to take affidavits.

An officer of a bank shall not, in any legal proceedings to which the bank is not a party, be compellable either to produce any book of the bank the contents of which can be proved as aforesaid, or to appear as a witness to prove the matters, transactions, and accounts therein recorded, unless by order of a Judge made for special cause.

On the application of any party to a legal proceeding a Court or Judge may, on summons, order that such party be at liberty to inspect and take copies of any entries in the books of a bank for any of the purposes of such proceeding.

An order under this section shall be served on the bank three clear days before the same is to be obeyed, unless the Court or Judge directs otherwise.

Sunday, and any bank holiday, shall be excluded from the computation of time under this section.

The costs of any application to a Court or Judge under or for the purposes of this section, and the costs of anything done or to be done under an order of a Court or Judge made under or for the purposes of this section, shall be in the discretion of the Court or Judge.

Where any such costs have been occasioned by any default or delay on the part of the bank, the Court or Judge may order that the same or any part thereof be paid to any party by the bank.

Any such order against a bank may be enforced as if the bank were a party to the proceeding.

Nothing herein shall limit the power of the Controller and Auditor-General, under the authority of any Act for the time being in force relating to the public revenues of New Zealand, to inspect the account of a private person in any bank if the Controller and Auditor-General declares that he has reason to believe, and does believe, that money the property of His Majesty or of the Government of New Zealand, or of any public body whose accounts he is by law required to audit, have been fraudulently or wrongfully paid into the private account of such person.

The several days mentioned in the Third Schedule hereto (which days are herein referred to as “bank holidays”) shall be kept as close holidays in all banks in New Zealand: Provided that—

With the previous consent in writing of the Minister of Finance, but not otherwise, the Managing Director, General Manager, or other chief officer in New Zealand for the time being of any bank may, by writing under his hand, appoint any day or portion of a day as a special bank holiday or part holiday at the bank under his direction or control, and such holiday or part holiday may be observed at any specified place or places in which the bank carries on business within New Zealand, subject to the provisions following, that is to say:—

No employee of a bank shall be employed during any part of a bank holiday or special bank holiday except for the purpose of dealing with correspondence and urgent matters of the day.

Every bank that commits a breach of this section is liable for each offence to a fine not exceeding five pounds in respect of each employee so employed.

This section shall not apply in the case of any person employed on the day, or any one of the seven days immediately preceding or following the day, upon which the bank balances its books for the half-year, nor in the case of any caretaker of the bank premises:

Provided that not less than seven days’ notice in writing of the day on which the bank balances its books as aforesaid shall be given to the Inspector of Factories.

All cheques and bank drafts in the possession of the bank on which they are drawn, and all bills of exchange or promissory notes in the possession of a bank and made payable at that bank, may be destroyed by such bank after the expiration of ten years from the date thereof in the case of documents payable on demand, or from the due date thereof in the case of all other documents.

This section shall apply to cheques, drafts, bills, and notes received by a bank either before or after the coming into operation of this Act.

No such document shall be destroyed under the authority of this section at any time after a demand for the delivery of such document has been made to the bank by the person entitled thereto.