Business

Reserve Bank of Australia offloads Securency stake

  • 12 February 2013
  • From the section Business
Australia bank notes
Note Printing Australia the printer of Australian notes will remain a central bank subsidiary

The Reserve Bank of Australia (RBA) has agreed to sell its stake in currency printing firm Securency International to UK-based Innovia Film.

Innovia, which already owns 50% of Securency, will pay A$65m ($67m; £40m) for RBA's 50% stake in the company.

The RBA had been looking to offload its stake since 2010, after allegations of bribery against the firm.

The firm has been accused of bribing officials in some Asian nations to win currency printing contracts.

"The sale of the Bank's interest in Securency is in accordance with the Bank's long-standing intention to exit from the joint venture," the central bank said in statement.

'Appropriate action'

Officials from Note Printing Australia (NPA), the printer of Australia's banknotes, had also faced similar allegations.

As the allegations emerged, Australia's central bank, faced criticism over its supervision of the firms.

However, a review done by consultancy firm Cameron Ralph, said that while there could have been more scrutiny of the firms, the bank had taken appropriate measures.

"With the benefit of hindsight, there could have been more oversight applied to the activities of the companies, which may have detected earlier the alleged illegal payments. But that does not mean that the Bank's oversight at the time was inappropriate," the report said.

"The bank gave reasonable consideration as to the governance arrangements for the two companies, and put in place processes for their oversight and reporting which were broadly consistent with usual practice at the time.

"There is evidence of the bank taking appropriate action where the entities appeared not to be performing in line with the bank's expectations and/or standards," it added.

Meanwhile, the RBA said that NPA would continue to remain its wholly-owned subsidiary.

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