DEPOSIT LIABILITIES OF BANK
29. For the purposes of section 62(3)(b) of the Act, “deposit liabilities of a bank” include the liabilities of a bank to a person under the following arrangement:
the person pays a sum of money to his agent or the bank for the purpose of making his funds available to the bank and to enable his agent or the bank to purchase an asset on his behalf, being an asset that exists at the time of the purchase;
the bank purchases the asset from the person at a price (the marked-up price) that is greater than the sum of money paid by the person, and sells the asset;
the person and the bank, respectively, do not derive any gain or suffer any loss from any movement in the market value of the asset other than the difference between the marked-up price and the sum of money paid by the person (which represents the return to the person for making his funds available to the bank); and
no part of the marked-up price is required to be paid by the bank to the person until after the date of sale of the asset by the bank.
[S 238/2007 wef 11/06/2007]