Trustees welcome Government decisions

Trustee Corporations Association Media statement 26 August 2009

Trustees welcome Government decisions

The Trustee Corporations Association today welcomed the Government’s decisions to strengthen the accountability of corporate trustees.

A package of measures was unveiled by the Minister of Commerce, the Hon Simon Power, at a securities law conference in Wellington this morning.

“We thank the Minister for his leadership in dealing with these issues,” said Clynton Hardy, Chairman of the Trustee Corporations Association. “He promised to fast-track the review of the role of corporate trustees and he has delivered on that.”

Under the new regime the automatic right of the statutorily approved trustee corporations to supervise issuers of debt and some collective investment schemes will be removed. Trustees will have to be licensed by the Securities Commission which will also have greater powers to supervise their work.

The TCA has four full members – Guardian Trust, Trustees Executors, Public Trust, and Perpetual Trust, with Covenant Trust as an associate.

Mr Hardy said that the role of trustees had been among the many areas of scrutiny following the collapse of many finance companies.

“While this is a very much tougher regime than that currently applying under the 1978 Securities Act, the main objective has to be to restore investor confidence in our role, and these measures are a very important step in that direction.”

“There is still a lot of detail to work through and we will work constructively with Parliament on the legislation once it is introduced into the House later this year, and with the Securities Commission on the resulting regulations.”

ends

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