State Bank (Privatisation) Act 1994

The State has the same rights of indemnity and subrogation in relation to the guarantee referred to in section 12 of this Act and the guarantee referred to in section 12 of the State Bank (Corporatisation) Act 1989, and the Bank has the same defences in relation to those rights, that they would have if the guarantees were contractual and not statutory.

Without affecting the generality of this section, the State’s rights of indemnity and subrogation continue despite completion of the sale of the Bank, the fact that any documentation relating to the sale of the Bank ceases to be effective or any other act, matter or thing that would terminate or limit those rights. However, nothing in this subsection prevents the State and the Bank from entering into agreements that would terminate or limit those rights.

Without prejudice to the State’s rights of subrogation, the State is taken to have waived all rights of indemnity in respect of any claims against the Bank that are guaranteed by the State (either by the guarantee referred to in section 12 of this Act or by the guarantee referred to in section 12 of the State Bank (Corporatisation) Act 1989) and that are expressed to be subordinated to other claims against the Bank.