Statistics Act, 1999
R 385
Mutual Banks Act, 1993 (Act No. 124 of 1993)Chapter VI : Provisions relating to Aspects of the Conduct of the Business of a Mutual Bank58. Dividends |
| (1) | A mutual bank shall not pay any dividend or bonus on the shares issued by it otherwise than out of the available profits of the mutual bank. |
| (2) | Where shares have been issued on condition that for the seven years immediately succeeding the registration of the mutual bank concerned its members shall be entitled to a cumulative dividend, and the profits available during the said period of seven years are insufficient to extinguish such cumulative dividend, the holders of such shares shall have no claim in respect of any shortfall in the amount so payable. |
| (3) | Where a mutual bank has, in terms of its articles, at the time of issue of any indefinite or fixed period share fixed the rate of dividend payable in respect of that share, the mutual bank shall, notwithstanding the terms on which the share has been issued, have the right from time to time to reduce the fixed rate of dividend so payable after giving the shareholder not less than one month's written notice of the intended reduction. |
| (4) | Where a mutual bank issued a fixed period share with the specific undertaking that the dividend rate during the full currency of the share will remain unaltered, the provisions of subsection (3) shall not apply: Provided that— |
| (a) | such a share shall not be redeemed by the mutual bank before the expiry of the period of issue except— |
| (i) | where the share forms part of the assets in an insolvent or a deceased estate; |
| (ii) | where the shareholder has been placed under curatorship or judicial management or in liquidation; |
| (iii) | in the case of a share that has been ceded to the mutual bank, another mutual bank or a bank as collateral security for a mortgage loan, if the cessionary of such share requires its redemption; or |
| (iv) | in such other cases as the Registrar may approve either generally or in any particular case; and |
| (b) | the mutual bank shall not grant a loan against the security of such a share. |
