Reserve Bank of Australia Annual Report – 1993 Financial Statements Contingent Liabilities and Other Items not included in the Balance Sheet

Note 10 Contingent Liabilities and Other Items not included in the Balance Sheet

Contingencies

• The Bank has a contingent liability, amounting to $78.8 million at 30 June 1993 ($64.2 million at 30 June 1992), 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 guaran-tees 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 defendant in litigation arising from the collapse of some financial institutions (in three of the four actions it is a secondary defendant), and in litigation relating to the technology used in security devices affixed to polymer notes. All will be 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. There was no significant expenditure warranting separate disclosure in 1992/93.