Board chairman Colin Dunn told councillors the bank was happy to take a lead in the matter and work collaboratively with council because it aligned with the bank's mission to give "50 per cent of the profits back to the community".

A long-term disaster fund had been raised as a motion to council to investigate because of the limitations of the existing Tathra Mayoral Fund which council's director business and governance Graham Stubbs said could only take donations up to two years after the event and could not be extended or applied to any other disaster.

Councillor Tony Allen proposed a motion asking for council staff to produce a report on the steps required to set up a charitable fund to operate in perpetuity for community members affected by natural disasters within the shire, how DGR status could be achieved and the rules around its governance and operation.

Councillor Sharon Tapscott asked if the motion could include an amendment which would provide a report on a collaborative model as outlined by Mr Dunn in his presentation but Cr Allen said he believed his motion "covers all bases".

Councillors heard that a major hurdle was in setting up an appropriate charity with DGR (tax deductible status for donors).

Councillor Liz Seckold said getting the Mayoral fund approved with DGR status had taken "an enormous amount of staff time" and "perhaps the bank idea would be a better idea".

"A collaborative model is the only way forward in the current legislative framework unless we set up a charity ourselves which I don't think is feasible," Mr Stubbs told the council meeting.

Reports will come back to council and are expected to include a separate report on the collaborative model following discussions between Mr Stubbs and Mr Dunn.