Lending decisions by the proposed Australian Business Investment Partnership will have to be unanimous among the five funders,
The Australian reported.
Citing a report prepared by the office of the Treasurer, Wayne Swan, and in response to questions from the newspaper, The Australian reported that the four major banks, along with the Australian government, will each appoint a director, and the government director will be the chair of the ABIP partnership's board.
Decisions to lend to a project would require unanimous support of all five directors, the newspaper reported, while a decision to implement proceedings against a borrower can be taken with the support of four directors, one of whom must be the government's. Ghe chair will be a former high-ranking public servant, the Financial Review reported.
Each of the major banks is investing $500 million capital in the fund while the Australian government plans to chip in $2 billion. The fund will borrow, with a guarantee, to a potential fund size approaching $30 billion.
The aim is to co-invest with banks in loans to the construction and property sector where foreign banks may (or have, in limited cases) quit the Australian market. There is also lobbying for the fund to invest in loans in other industry sectors.