Intellectual Property Rights from Publicly Financed Research and
R 385
Mutual Banks Act, 1993 (Act No. 124 of 1993)Chapter V : Prudential requirements51. Large exposures |
| (1) | A mutual bank shall not make investments with, or grant loans or advances or other credit to, any person, to an aggregate amount exceeding an amount representing a prescribed percentage of such mutual bank's capital and reserves, without first having obtained the permission of its board, or of a committee appointed for such purpose by its board (at least one of the members of which committee shall be a director of the mutual bank who is not in its employ nor in the employ of any of its associates), to make such investments or to grant such loans, advances or other credit. |
| (2) | A mutual bank shall in such manner and on such a form as may be prescribed, report to the Registrar whenever it makes an investment with or grants a loan or advance or other credit to any person, which transaction, either alone or together with any previous transaction or transactions entered into by it with that person, results in the mutual bank being exposed to that person up to an amount exceeding an amount representing a prescribed percentage of its capital and reserves. |
| (3) | For the purposes of this section "person" includes— |
| (a) | two or more persons, whether natural or juristic persons, the respective exposures to whom constitute a single exposure because of the fact that one of them directly or indirectly exercises control over the other or others; and |
| (b) | two or more persons, whether natural or juristic persons, between whom there exists no relationship of control as contemplated in paragraph (a), but the respective exposures to whom are to be regarded as a single exposure because of the fact that they are so interconnected that should one of them experience financial difficulties another one or all of them would be likely to experience a lack of liquidity. |
