Reserve Bank of Australia Annual Report – 1998 Financial Statements Note 9 – Contingent liabilities and other items not included in the balance sheet


The Bank has a contingent liability, amounting to $67.6 million at 30 June 1998 ($62.8 million at 30 June 1997), in respect of the uncalled portion of its shares held in the Bank for International Settlements.

In the course of providing banking services to its customers, the Bank provides performance guarantees to third parties in relation to customer activities. Such exposure is not material and has not given rise to losses in the past.

Other items

The Reserve Bank is a respondent on appeal from a judgement given in the Bank's favour by the Federal Court. The Bank is a defendant in two common law matters. The Bank is an appellant in a case regarding a payroll tax assessment and is a respondent and third party before the Administrative Appeals Tribunal in two matters concerning workers' compensation. All cases in which the Bank is defendant or respondent are being defended, and none is judged likely to have a materially adverse effect on the activities, financial condition or operating results of the Bank.

In keeping with Commonwealth Government policy, the Bank carries its own insurance risks except where administrative costs are estimated to be excessive. Experience with self insurance claims is as follows:

Number of Claims on Bank
1997 1998
0 – $10,000 64 32
$10,001 – $20,000 1
$20,001 – $30,000 3
$40,001 – $50,000 1