Maintenance of adequate capital and reserves
48 Maintenance of adequate capital and reserves
The Board is required to ensure, according to sound commercial principles, that the capital and reserves of Housing Australia at any time are sufficient:
to meet the likely liabilities (other than guarantee liabilities) of Housing Australia; and
to make adequate provision for default in the repayment of principal, or in the payment of interest or other charges, in connection with loans made by Housing Australia.
If, at any time, the Board determines:
that the capital and reserves of Housing Australia are not sufficient to meet the likely liabilities, and make the provision, referred to in subsection (1); or
that there are reasonable grounds for believing that, at a time in the future, the capital and reserves of Housing Australia may not be sufficient to meet the likely liabilities, and make the provision, referred to in subsection (1);
the Board must, as soon as practicable, cause the Minister to be informed in writing of its determination and the reasons for that determination.
The Investment Mandate may include a direction that the Board must, for the purposes of subsections (1) and (2), disregard liabilities or loans of a specified type.
This section does not apply in relation to liabilities or defaults under Help to Buy arrangements (within the meaning of the Help to Buy Act 2024).
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