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RESERVE BANK OF AUSTRALIA

Questions & Answers

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  1. What is the Reserve Bank of Australia and who owns it?
  2. How does the Reserve Bank set interest rates?
  3. Who is on the Reserve Bank Board and how are they appointed?
  4. Can I open a bank account with the Reserve Bank?
  5. What if I have a concern or complaint about my bank or similar financial institution?
1. What is the Reserve Bank of Australia and who owns it?

The Reserve Bank of Australia is Australia's central bank. Its role is set out in the Reserve Bank Act 1959. The Bank conducts the nation's monetary policy and issues its currency. It seeks to foster financial system stability and promotes the safety and efficiency of the payments system. It also offers banking services to government. The Bank is a body corporate wholly owned by the Commonwealth of Australia. For more information see about the RBA.

2. How does the Reserve Bank set interest rates?

The Reserve Bank Board makes monetary policy decisions in terms of the cash rate – the interest rate on overnight loans in the money market. These decisions affect a range of other market and institutional interest rates. For details see about monetary policy.

3. Who is on the Reserve Bank Board and how are they appointed?

The Reserve Bank Board has up to nine members. Three of these are ex officio: the Reserve Bank Governor (Chairman), the Deputy Governor (Deputy Chairman) and the Secretary to the Treasury. The Governor and Deputy Governor are appointed by the Treasurer for terms of up to seven years. The other six (non-executive) members are appointed for terms of up to five years. Board members are appointed by the Treasurer and there is no limit on the number of terms they may serve. See Reserve Bank Board for more information, including details on current and previous members of the Board.

4. Can I open a bank account with the Reserve Bank?

The Reserve Bank is not a commercial bank and so does not provide banking facilities to the general public. It does, however, provide banking services to some government, commercial bank and other clients.

5. What if I have a concern or complaint about my bank or similar financial institution?

The Reserve Bank does not supervise the prudential soundness of banks or other financial institutions, though it does have a role in maintaining the stability of the financial system as a whole.

The Australian Prudential Regulation Authority (APRA) is responsible for prudential supervision of financial institutions.

The Reserve Bank also does not handle consumer complaints about financial institutions. Such matters should be addressed to the Australian Securities and Investments Commission (ASIC) or the Financial Ombudsman Service.