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Contents

Long Title

Part I PRELIMINARY

Part II APPOINTMENT OF ASSISTANTS

Part III LICENSING OF BANKS

Part IV RESERVE FUNDS, DIVIDENDS, BALANCE-SHEETS AND INFORMATION

Part V PROHIBITED BUSINESS

Part VI MINIMUM ASSET REQUIREMENTS

Part VII POWERS OF CONTROL OVER BANKS

Part VIIA VOLUNTARY TRANSFER OF BUSINESS

Division 1 — Voluntary transfer of business of bank

Division 2 — Repealed

Division 3 — Repealed

Division 4 — Repealed

Division 5 — Miscellaneous

Part VIII CREDIT CARD AND CHARGE CARD BUSINESSES

Part IX MISCELLANEOUS

FIRST SCHEDULE Banks

SECOND SCHEDULE Effect of Merger

THIRD SCHEDULE Disclosure of Information

FOURTH SCHEDULE Specified Provisions

FIFTH SCHEDULE Definitions in Sections 27, 28, 29 and 38

Legislative History

Comparative Table

Comparative Table

 
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On 19/04/2014, you requested the version in force on 19/04/2014 incorporating all amendments published on or before 19/04/2014. The closest version currently available is that of 02/01/2014.
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PART III
LICENSING OF BANKS
Licensing of banks
4.
—(1)  No banking business shall be transacted in Singapore except by a company which is in possession of a valid licence granted under this Act by the Authority authorising it to conduct banking business in Singapore.
(2)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
Restriction on deposit-taking business and soliciting deposits
4A.
—(1)  Subject to subsection (6), no person shall, in the course of carrying on (whether in Singapore or elsewhere) a deposit-taking business, accept in Singapore any deposit from any person in Singapore.
[23/2001]
(2)  No person shall, whether in Singapore or elsewhere, offer or invite or issue any advertisement containing any offer or invitation to the public or any section of the public in Singapore —
(a)
to make any deposit, whether in Singapore or elsewhere; or
(b)
to enter or offer to enter into any agreement to make any deposit, whether in Singapore or elsewhere,
where such deposit is to be made with any person (not being a person specified in subsection (6)) in the course of the carrying on (whether in Singapore or elsewhere) of a deposit-taking business by that person.
[23/2001; 1/2007]
(3)  For the purposes of subsection (2), in determining whether an offer, invitation or advertisement is made or issued to the public or any section of the public in Singapore, regard shall be had to such considerations as the Authority may prescribe.
[23/2001]
(4)  Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
(5)  A person whose business it is to publish or to arrange for the publication of advertisements shall not be guilty of an offence under subsection (4) if he proves that —
(a)
he received the advertisement for publication in the ordinary course of his business;
(b)
the matters contained in the advertisement were not, wholly or in part, devised or selected by him or by any person under his direction or control; and
(c)
he did not know and had no reason for believing that the publication of the advertisement would constitute an offence.
[23/2001]
(6)  Without prejudice to section 76, subsection (1) shall not apply to —
(a)
any bank in Singapore;
(b)
any co-operative society registered as a credit society under the Co-operative Societies Act (Cap. 62);
(c)
any finance company licensed under the Finance Companies Act (Cap. 108);
(d)
any merchant bank approved as a financial institution under section 28 of the Monetary Authority of Singapore Act (Cap. 186);
(e)
any person (other than a person referred to in paragraphs (a) to (d)) who is licensed, approved, authorised or otherwise empowered under any written law to accept deposits in Singapore in accordance with such law; and
(f)
such other person or class of persons as the Authority may prescribe and subject to such conditions as may be prescribed by the Authority.
[23/2001]
(7)  The fact that a deposit has been taken in contravention of this section shall not affect any civil liability in respect of the deposit or the money deposited.
[23/2001]
Application of section 4A
4B.
—(1)  For the purposes of section 4A, “advertisement” means the dissemination or conveyance of information, or invitation or solicitation by any means or in any form, including by means of —
(a)
publication in a newspaper, magazine, journal or other periodical;
(b)
display of posters or notices;
(c)
circulars, handbills, brochures, pamphlets, books or other documents;
(d)
letters addressed to individuals or bodies;
(e)
photographs or cinematograph films; or
(f)
sound broadcasting, television, the Internet or other media.
[23/2001]
(2)  An advertisement containing information which is intended or might reasonably be presumed to be intended to lead, directly or indirectly, to the making of a deposit shall be treated as an advertisement referred to in section 4A.
[23/2001]
(3)  Notwithstanding subsections (1) and (2), an advertisement issued outside Singapore shall not be treated as an advertisement for the purposes of section 4A(2) if it is made available —
(a)
in a newspaper, magazine, journal or other periodical published and circulating principally outside Singapore;
(b)
in a sound or television broadcast transmitted principally for reception outside Singapore; or
(c)
by any other means of broadcasting or communication principally for circulation or reception outside Singapore.
[23/2001]
(4)  Subject to the provisions of this section, for the purposes of section 4A, “deposit” means —
(a)
a sum of money paid on terms —
(i)
under which it will be repaid, with or without interest or a premium, or with any consideration in money or money’s worth, either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person receiving it; and
(ii)
which are not referable to the provision of property or services or to the giving of security; and
(b)
such other product as may be prescribed.
[1/2007]
(4A)  The Authority may, by regulations, exclude any product from the definition of “deposit” in subsection (4)(a).
[1/2007]
(5)  For the purposes of subsection (4)(a)(ii), money is paid on terms which are referable to the provision of property or services or to the giving of security if, and only if —
(a)
it is paid by way of advance or part payment under a contract for the sale, hire or other provision of property or services, and is repayable only in the event that the property or services is or are not in fact sold, hired or otherwise provided;
(b)
it is paid by way of security for the performance of a contract or by way of security in respect of loss which may result from the non-performance of a contract; or
(c)
without prejudice to paragraph (b), it is paid by way of security for the delivery up or return of any property, whether in a particular state of repair or otherwise.
[23/2001; 1/2007]
(6)  For the purposes of subsection (4), “deposit” does not include —
(a)
a sum paid by the Authority, any person referred to in section 4A(6)(a) to (d) or any insurer licensed under the Insurance Act (Cap. 142);
(b)
a sum paid by any moneylender licensed under the Moneylenders Act (Cap. 188);
(c)
a sum paid by one company to another at a time when one is a subsidiary of the other or both are subsidiaries of another company, or the same individual controls more than half of the voting power or holds more than half of the total number of issued shares in both of them;
(d)
a sum paid by a person who, at the time when it is paid, is a close relative of the person receiving it or who is, or is a close relative of, a director, controller or manager of that person; and
(e)
a sum paid by such person or class of persons as may be prescribed.
[23/2001; 1/2007]
(7)  Subject to the provisions of this section, for the purposes of section 4A, a business is a deposit-taking business if —
(a)
in the course of the business, money received by way of deposit is lent to others; or
(b)
any other activity of the business is financed, wholly or to any material extent, out of the capital of or the interest on money received by way of deposit.
[23/2001]
(8)  Notwithstanding that subsection (7)(a) or (b) applies to a business, it is not a deposit-taking business if the person carrying on the business —
(a)
does not hold himself out as accepting deposits on a day-to- day basis; and
(b)
does not accept deposits on a day-to-day basis, whether or not involving the issue of debentures or securities.
[23/2001]
(9)  For the purposes of subsection (7), all the activities which a person carries on by way of business shall be regarded as a single business carried on by him.
[23/2001]
(10)  In this section —
“close relative”, in relation to a person, means the spouse or a parent, remoter lineal ancestor or step-parent or a son, daughter, remoter issue, step-son or step-daughter or a brother or sister, of the person;
“controller” means a 12% controller or 20% controller as defined in section 15B(3);
“debentures” has the same meaning as in section 4(1) of the Companies Act (Cap. 50);
“securities” has the same meaning as in section 2(1) of the Securities and Futures Act (Cap. 289).
[23/2001; 42/2001]
Examination of persons suspected of contravening section 4A and access to premises
4C.
—(1)  Whenever the Authority has reason to believe that a person has contravened or is contravening section 4A(1) or (2), the Authority shall at all times —
(a)
have full and free access to the premises at which that person is suspected of having committed or of committing the contravention, or at which that person may have books; and
(b)
have the power to examine, copy or take possession of the books of that person in order to ascertain whether or not that person has contravened or is contravening section 4A(1) or (2).
[23/2001; 1/2007]
(2)  Any person who obstructs the Authority in the exercise of its powers under subsection (1) or fails without reasonable excuse to furnish such books in his possession as may be required by the Authority, shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $12,500 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part thereof during which the offence continues after conviction.
[23/2001; 1/2007]
Use of word “bank”
5.
—(1)  No person or body of persons, whether incorporated or not, other than a bank shall, without the written consent of the Authority —
(a)
use the word “bank”or any of its derivatives in any language, or any other word indicating it transacts banking business, in the name, description or title under which the person or body of persons is transacting business in Singapore; or
(b)
make or continue to make any representation to that effect in any bill head, letter paper, notice, advertisement or in any other manner.
(2)  Subject to subsection (2B), nothing in this section shall prohibit the following persons or bodies of persons from using the word “bank” or any of its derivatives in any language, or any other word indicating the transaction of banking business, as a part of its name or title or in the description of its activities:
(a)
any representative office of a foreign company which is not a bank in Singapore if —
(i)
the foreign company is licensed, registered, approved or otherwise regulated as a bank under the law of the foreign country or territory in which it is incorporated, formed or established; and
(ii)
the following information is provided in every advertisement made by the representative office which is directed at the public or a section of the public in Singapore:
(A)
the country or territory in which the foreign company is incorporated, formed or established; and
(B)
the fact that the foreign company is licensed, registered, approved or otherwise regulated as a bank in that country or territory;
(b)
any central bank of a foreign country or territory;
(c)
any association of banks formed for the protection of common interests;
(d)
any related corporation of a bank in Singapore which does not carry on banking business in Singapore or elsewhere and which carries on any business referred to in section 30(1)(b), (c) or (d) if the word “bank” or any of its derivatives in any language, or any other word indicating the transaction of banking business —
(i)
is used in a manner to indicate or represent that the corporation is a related corporation of the bank; and
(ii)
is used together with any other word to indicate or represent that the related corporation is not a bank in Singapore;
(e)
any person or body of persons that does not transact banking business or the business of a financial institution in Singapore or elsewhere, if the word “bank” or any of its derivatives in any language, or any other word indicating the transaction of banking business, is used together with any other word to indicate or represent that the person or body of persons is not a bank in Singapore;
(f)
any merchant bank approved as a financial institution under section 28 of the Monetary Authority of Singapore Act (Cap. 186); and
(g)
such international financial institution as may be prescribed.
[1/2007]
(2A)  Sections 4A(3) and 4B(1), (2) and (3) shall apply, with the necessary modifications, to an advertisement made by a representative office referred to in subsection (2)(a).
[1/2007]
(2B)  If the Authority is satisfied that a person or body of persons to whom subsection (2) applies has misled or is likely to mislead the public or a section of the public as to whether the person or body of persons is a bank in Singapore, the Authority may, by notice in writing to the person or body of persons, direct the person or body of persons to cease —
(a)
using the word “bank” or any of its derivatives in any language, or any other word indicating the transaction of banking business, in the name, description or title under which the person or body of persons is transacting business in Singapore; and
(b)
making any representation to that effect in any bill head, letter paper, notice, advertisement or in any other manner,
from the date specified by the Authority in the notice, and subsection (1) shall apply to the person or body of persons as from that date.
[1/2007]
(2C)  The Authority shall publish in the Gazette such particulars as it thinks fit in respect of every person or body of persons to whom a notice is issued under subsection (2B).
[1/2007]
(3)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $12,500 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part thereof during which the offence continues after conviction.
[23/2001]
Use of bank name, etc.
5A.
—(1)  No person shall, without the prior approval of the Authority, in the course of any profession, vocation, trade or business, use any name, logo or trade mark in a manner which indicates or represents that the person or his trade or business is related to or associated with a bank incorporated in Singapore or any of its subsidiaries which carries on a business referred to in section 30(1)(a), (b), (c) or (d).
[23/2001; 1/2007]
(2)  No bank incorporated in Singapore shall cause or knowingly permit any person (other than a related corporation of the bank which carries on any business referred to in section 30(1)(a), (b), (c) or (d) or the financial holding company of the bank) to use its name, logo or trade mark in the course of the person’s profession, vocation, trade or business without the prior approval of the Authority.
[23/2001; 1/2007]
(3)  Any person who contravenes this section shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
(4)  This section shall not apply, in relation to any bank incorporated in Singapore or any subsidiary of the bank referred to in subsection (1), to —
(a)
any related corporation of the bank which carries on a business referred to in section 30(1)(a), (b), (c) or (d) or the financial holding company of the bank;
(b)
any officer or agent of the bank or of any of its subsidiaries which carries on a business referred to in section 30(1)(a), (b), (c) or (d), in the conduct of any duty or function in or for the bank or the subsidiary, as the case may be;
(c)
any person carrying on a business referred to in section 30(1)(a), (b), (c) or (d) pursuant to any agreement or arrangement with the bank; and
(d)
such other person or class of persons as may be prescribed.
[23/2001; 1/2007]
(5)  Nothing in this section shall prevent a person who lawfully uses any name, logo or trade mark in the manner referred to in subsection (1) before 18th July 2001* from continuing to use the name, logo or trade mark in such manner for a period of 3 years from 18th July 2001.
*  Date of commencement of the Banking (Amendment) Act 2001 (Act 23 of 2001).
[23/2001]
Examination of persons suspected of transacting banking business and access to premises
6.
—(1)  Whenever the Authority has reason to believe that a person is transacting banking business without a licence, the Authority shall, at all times —
(a)
have full and free access to the premises at which that person is suspected of transacting banking business without a licence or at which that person may have books; and
(b)
have the power to examine, copy or take possession of the books of that person in order to ascertain whether or not that person has violated, or is violating, any of the provisions of this Act.
[2/84; 1/2007]
(2)  Any refusal to allow full and free access to such premises or to submit such books shall be prima facie evidence of the fact of operation without a licence.
[2/84; 1/2007]
Application for licence
7.
—(1)  A company which desires authority to carry on banking business in Singapore shall apply in writing to the Authority for a licence under this section and shall supply —
(a)
a copy of the memorandum of association and articles of association or other instrument under which the company is incorporated, duly verified by a statutory declaration made by a senior officer of the company;
(b)
a copy of the latest balance-sheet of the company; and
(c)
such other information as may be called for by the Authority.
(2)  Any person who knowingly or recklessly furnishes any document or information which is false or misleading in a material particular in connection with an application for a licence falling within subsection (1) shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both; or
(b)
in any other case, to a fine not exceeding $250,000.
[2/84; 23/2001]
(3)  Upon receiving an application under subsection (1), the Authority shall consider the application and may, subject to section 9 or 9A, as the case may be, grant a licence, with or without conditions, or refuse to grant a licence.
[23/2001]
(4)  The Authority may at any time vary or revoke any existing conditions of a licence or impose conditions or additional conditions thereto.
(5)  The Authority shall, prior to any action under subsection (4) —
(a)
notify its intention to take that action to the bank concerned; and
(b)
give the bank an opportunity to submit reasons why the conditions of its licence should not be so varied or revoked.
(6)  Where a licence is subject to conditions, the bank shall comply with those conditions.
(7)  Any bank which fails to comply with any of the conditions of its licence shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine of $10,000 for every day during which the offence continues after conviction.
[2/84; 23/2001]
Licence fees
8.
—(1)  Every bank in Singapore shall pay such annual licence fee as the Authority may, by notification in the Gazette, prescribe.
(2)  The Authority may prescribe different licence fees in respect of different classes or categories of banks and the fees shall apply uniformly to those classes or categories.
(3)  The manner of payment of the licence fee shall be as specified by the Authority.
Minimum capital requirements
9.
—(1)  Subject to this Act, a bank shall not be granted or hold a licence unless —
(a)
in the case of a bank incorporated in Singapore, its paid-up capital is not less than $1,500 million or such other amount as may be prescribed, and its capital funds are not less than that amount; or
(b)
in the case of a bank incorporated outside Singapore its head office capital funds are not less than the equivalent of $200 million.
[28/93; 21/96; 23/2001; 1/2007]
(2)  A bank incorporated outside Singapore which holds a licence to carry on banking business in Singapore on 8th October 1993 shall be exempt from subsection (1)(b).
[23/2001]
(3)  A bank incorporated in Singapore shall not reduce its paid-up capital, or purchase or otherwise acquire shares issued by the bank if such shares are to be held as treasury shares, without the approval of the Authority.
[1/2007]
(4)  Any bank which fails to comply with any requirement under subsection (1) shall immediately notify the Authority.
[23/2001]
(5)  Where a bank fails to comply with any provision of this section, the Authority may, without prejudice to section 71, by notice in writing to the bank —
(a)
restrict or suspend the operations of the bank; or
(b)
give such directions to the bank as the Authority considers appropriate, and the bank shall comply with such directions.
[23/2001]
(6)  In this section —
“head office capital funds”, in relation to a bank incorporated outside Singapore, means the aggregate of its paid-up capital (or its equivalent recognised by the Authority as applicable to the bank under the laws of the country or territory in which the bank is incorporated, formed or established) and its published reserves (excluding such reserves as the Authority may specify in writing), deduction having been made for any loss appearing in the accounts of the bank;
“paid-up capital” does not include any amount that is represented by treasury shares.
[1/2007]
Capital requirements for qualifying subsidiaries
9A.
—(1)  Notwithstanding section 9, a company incorporated in Singapore which is a qualifying subsidiary may be granted and hold a licence under section 7 if —
(a)
it is and continues to be a qualifying subsidiary; and
(b)
its paid-up capital is not less than $100 million.
[23/2001; 1/2007]
(2)  A bank which is a qualifying subsidiary shall not reduce its paid-up capital, or purchase or otherwise acquire shares issued by the bank if such shares are to be held as treasury shares, without the approval of the Authority.
[1/2007]
(3)  A bank which is a qualifying subsidiary shall maintain capital funds of not less than $100 million unless the Authority approves otherwise.
[23/2001; 1/2007]
(4)  The Authority may, in its discretion, on application by any bank, exempt that bank from subsection (1)(a) subject to such conditions as the Authority may impose, and in such event, the other provisions of this section shall continue to apply to that bank notwithstanding that it may no longer be a qualifying subsidiary.
[23/2001]
(5)  Any bank which fails to comply with any requirement under subsection (1) shall immediately notify the Authority.
[23/2001]
(6)  Where a bank fails to comply with any provision of this section or any condition imposed by the Authority under this section, the Authority may, without prejudice to section 71, by notice in writing to the bank —
(a)
restrict or suspend the operations of the bank; or
(b)
give such directions to the bank as it considers appropriate and the bank shall comply with such directions.
[23/2001]
(7)  In this section, “paid-up capital” does not include any amount that is represented by treasury shares.
[1/2007]
Risk-based capital requirements
10.
—(1)  The Authority may, by notice in writing, require any bank in Singapore or class of banks in Singapore to maintain capital funds in Singapore of such amount (not being less than the minimum prescribed in section 9 or 9A, as the case may be) and in such manner as the Authority considers appropriate, having regard to the risks arising from the activities of the bank or class of banks, as the case may be, and such other factors as the Authority considers relevant.
[23/2001]
(2)  A bank incorporated in Singapore shall not, at any time, have a capital adequacy ratio of less than 12%, or such other percentage as may be determined by the Authority from time to time, as calculated in accordance with such form, content and manner as may be determined by the Authority by notice in writing.
[28/93]
(3)  The Authority may, if it considers appropriate in the particular circumstances of a bank incorporated in Singapore, having regard to the risks arising from the activities of the bank and such other factors as the Authority considers relevant, vary the capital adequacy ratio applicable to that bank.
[23/2001]
(4)  The Authority may restrict or suspend the operations of a bank which fails to comply with subsection (2) or (3) or any requirement of the Authority under subsection (1).
[28/93; 23/2001]
Foreign government-owned banks
11.  [Repealed by Act 1 of 2007]
Appeal to Minister
11A.  Any applicant who is aggrieved by the refusal of the Authority to grant a licence under section 7(3) may, within 30 days of the decision of the Authority, appeal in writing to the Minister whose decision shall be final and shall be given effect to by the Authority.
[28/93; 23/2001; 1/2007]
Branches
12.
—(1)  No bank shall open a new place of business or change the location of an existing place of business in Singapore without submitting a written application in respect thereof to the Authority which may —
(a)
give its approval; or
(b)
without assigning any reason, refuse to give its approval.
(2)  No bank incorporated in Singapore shall open a new branch, agency or office in any place outside Singapore without submitting a written application in respect thereof to the Authority, which shall approve or reject the application.
(3)  Any bank which contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine of $2,500 for every day during which the offence continues after conviction.
[2/84; 23/2001]
Fees to be paid in respect of branches of banks
13.
—(1)  The Authority may, from time to time by notification in the Gazette, specify the annual licence fees which banks in Singapore shall pay for each of their branches.
(2)  The manner of payment shall be as specified by the Authority.
Mergers
14.
—(1)  A bank incorporated in Singapore shall not be merged or consolidated with, or be taken over by, any other body corporate or unincorporate without the prior written approval of the Minister.
[23/2001]
(2)  The Minister may approve an application made under subsection (1) if —
(a)
the Authority is satisfied that —
(i)
the body corporate or unincorporate is a fit and proper person or body of persons; and
(ii)
having regard to the likely influence of the body corporate or unincorporate, the business of the bank will be or will continue to be conducted prudently and the provisions of this Act will be or will continue to be complied with in relation to such business; and
(b)
the Minister is satisfied that it is in the national interest to do so.
[1/2007]
(2A)  The parties to a proposed merger or consolidation, in respect of which an application is made under this section, shall furnish such information as the Minister or the Authority may require for the purposes of subsection (2).
[1/2007]
(3)  Without prejudice to the generality of subsection (1), for the purposes of this section, a bank shall be deemed to be merged with a body corporate or unincorporate if the bank or its shareholders enter into any agreement or arrangement under which all or substantially all of the business of the bank is to be managed, and under which the shareholders of the bank will be accorded rights, as if the bank has been merged with such body corporate or unincorporate, as the case may be.
[23/2001]
Approval by Minister for merger of certain banks
14A.
—(1)  Subject to this section and section 14B, on the joint application of a bank and one or more banks which are wholly-owned subsidiaries of that bank, the Minister may approve the merger of those banks and issue a certificate of approval.
[28/93]
(2)  The issue of a certificate of approval by the Minister under subsection (1) merges the banks that are parties to the merger agreement on which the application for the certificate of approval is based.
[28/93]
(3)  Where a certificate of approval is issued under subsection (1) merging the banks, the merger shall for all purposes be deemed to have occurred and to be effective on the date mentioned in subsection (4).
[28/93]
(4)  A certificate of approval issued under subsection (1) shall have no force or effect until a copy of the certificate and the merger agreement on which it is issued is lodged with the Registrar of Companies, and upon being so lodged the certificate shall take effect on and from the date of lodgment.
[28/93]
(5)  No application to the Minister for a certificate of approval merging 2 or more banks may be made under subsection (1) unless —
(a)
the merger is between a bank and one or more banks which are wholly owned subsidiaries of that bank;
(b)
the banks proposing to merge have entered into a merger agreement; and
(c)
the application for the certificate of approval is made within 2 weeks from the date of execution of the merger agreement referred to in paragraph (b).
[28/93; 23/2001]
(6)  Where a certificate of approval is issued under subsection (1) merging the banks, those banks shall publish a notice of the approval of the merger at least once in a local Malay, English, Chinese and Tamil language daily newspaper within one week from the date of the certificate of approval.
[28/93]
(7)  For the avoidance of doubt, it is hereby declared that sections 210 and 212 of the Companies Act (Cap. 50) shall not apply to the banks which have jointly applied for a certificate of approval under subsection (1).
[28/93]
Condition for issue of certificate of approval
14B.
—(1)  The Minister shall not issue a certificate of approval under section 14A unless the application thereof is supported by satisfactory evidence that the applicants have complied with the requirements of that section in relation to the merger.
[28/93]
(2)  Nothing in this Act shall be construed as precluding the Minister from refusing to issue or approve the issue of any certificate of approval under section 14A and any decision of the Minister under that section shall be final and shall not be called in question in any court.
[28/93]
Effect of merger
14C.  As from the date mentioned in section 14A(4), the provisions set out in the Second Schedule shall have effect and shall apply to the banks that are parties to the merger agreement on which a certificate of approval is issued under section 14A(1).
[28/93]
Application and interpretation of sections 15A to 18
15.
—(1)  This section and sections 15A to 18 shall apply to, and in relation to, all individuals whether resident in Singapore or not and whether citizens of Singapore or not, and to all bodies corporate or unincorporate, whether incorporated or carrying on business in Singapore or not.
[23/2001]
(2)  In sections 15A to 18, unless the context otherwise requires —
“arrangement” includes any formal or informal scheme, arrangement or understanding, and any trust whether express or implied;
“designated financial institution” means —
(a)
a bank incorporated in Singapore; or
(b)
a financial holding company;
“voting share” has the same meaning as in section 4(1) of the Companies Act (Cap. 50).
[23/2001]
Control of substantial shareholdings in designated financial institutions
15A.
—(1)  No person shall, on or after 18th July 2001*, become a substantial shareholder of a designated financial institution without first obtaining the approval of the Minister.
*  Date of commencement of the Banking (Amendment) Act 2001 (Act 23 of 2001).
[23/2001]
(2)  Subject to section 15C(4), no person who, immediately before 18th July 2001, is a substantial shareholder of a designated financial institution shall continue to be such a shareholder unless he has, within 6 months after 18th July 2001 or such longer period as the Minister may allow, applied to the Minister for approval to continue to be such a shareholder.
[23/2001]
(3)  No person shall, on or after 18th July 2001, enter into any agreement or arrangement, whether oral or in writing and whether express or implied, to act together with any person with respect to the acquisition, holding or disposal of, or the exercise of rights in relation to, their interests in voting shares of an aggregate of 5% or more of the total votes attached to all voting shares in a designated financial institution, without first obtaining the approval of the Minister.
[23/2001; 21/2005]
(4)  Subject to section 15C(4), no person who, at any time before 18th July 2001, has entered into any agreement or arrangement referred to in subsection (3) shall continue to be a party to such an agreement or arrangement unless he has, within 6 months after 18th July 2001 or such longer period as the Minister may allow, applied to the Minister for approval to continue to be a party to such an agreement or arrangement.
[23/2001]
(5)  For the purposes of this section, a person has an interest in any share if —
(a)
he is deemed to have an interest in that share under section 7 of the Companies Act (Cap. 50); or
(b)
he otherwise has a legal or an equitable interest in that share except for such interest as is to be disregarded under section 7 of the Companies Act.
[23/2001]
Control of shareholdings and voting power in designated financial institutions
15B.
—(1)  No person shall, on or after 18th July 2001, become —
(a)
a 12% controller;
(b)
a 20% controller; or
(c)
an indirect controller,
of a designated financial institution without first obtaining the approval of the Minister.
[23/2001]
(2)  Subject to section 15C(4), no person who, immediately before 18th July 2001, is —
(a)
a 12% controller;
(b)
a 20% controller; or
(c)
an indirect controller,
of a designated financial institution shall continue to be such a controller unless he has, within 6 months after 18th July 2001 or such longer period as the Minister may allow, applied to the Minister for approval to continue to be such a controller.
[23/2001]
(3)  In subsections (1)(a) and (b) and (2)(a) and (b) —
“12% controller” means a person, not being a 20% controller, who alone or together with his associates —
(a)
holds not less than 12% of the total number of issued shares in the designated financial institution; or
(b)
is in a position to control voting power of not less than 12% in the designated financial institution;
“20% controller” means a person who, alone or together with his associates —
(a)
holds not less than 20% of the total number of issued shares in the designated financial institution; or
(b)
is in a position to control voting power of not less than 20% in the designated financial institution.
[23/2001; 21/2005]
(4)  For the purposes of subsection (3) —
(a)
a person holds a share if —
(i)
he is deemed to have an interest in that share under section 7(6) to (10) of the Companies Act (Cap. 50); or
(ii)
he otherwise has a legal or an equitable interest in that share except for such interest as is to be disregarded under section 7(6) to (10) of the Companies Act;
(b)
a reference to the control of a percentage of the voting power in a designated financial institution is a reference to the control, whether direct or indirect, of that percentage of the total number of votes that might be cast in a general meeting of the designated financial institution; and
(c)
a person, A, is an associate of another person, B, if —
(i)
A is the spouse or a parent, remoter lineal ancestor or step-parent or a son, daughter, remoter issue, step-son or step-daughter or a brother or sister, of B;
(ii)
A is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B, or where B is a corporation, of the directors of B;
(iii)
B is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A, or where A is a corporation, of the directors of A;
(iv)
A is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B;
(v)
B is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A;
(vi)
A is a related corporation of B;
(vii)
A is a corporation in which B, alone or together with other associates of B as described in paragraphs (ii) to (vi), is in a position to control not less than 20% of the voting power in A;
(viii)
B is a corporation in which A, alone or together with other associates of A as described in paragraphs (ii) to (vi), is in a position to control not less than 20% of the voting power in B; or
(ix)
A is a person with whom B has an agreement or arrangement, whether oral or in writing and whether express or implied, to act together with respect to the acquisition, holding or disposal of shares or other interests in, or with respect to the exercise of their voting power in relation to, the designated financial institution.
[23/2001]
(5)  In subsections (1)(c) and (2)(c), “indirect controller” means any person, whether acting alone or together with any other person, and whether with or without holding shares or controlling voting power in a designated financial institution —
(a)
in accordance with whose directions, instructions or wishes the directors of the designated financial institution are accustomed or under an obligation, whether formal or informal, to act; or
(b)
who is in a position to determine the policy of the designated financial institution,
but does not include any person —
(i)
who is a director or other officer of the designated financial institution whose appointment has been approved by the Authority; or
(ii)
in accordance with whose directions, instructions or wishes the directors of the designated financial institution are accustomed to act by reason only that they act on advice given by him in his professional capacity.
[23/2001]
Approval of applications
15C.
—(1)  The Minister may approve an application made by any person under section 15A or 15B if —
(a)
the Authority is satisfied that —
(i)
the person is a fit and proper person; and
(ii)
having regard to the likely influence of the person, the designated financial institution will or will continue to conduct its business prudently and comply with the provisions of this Act; and
(b)
the Minister is satisfied that it is in the national interest to do so.
[1/2007]
(2)  Any approval under this section may be granted to any person subject to such conditions as the Minister may determine, including but not limited to any condition —
(a)
restricting the person’s disposal or further acquisition of shares or voting power in the designated financial institution; or
(b)
restricting the person’s exercise of voting power in the designated financial institution.
[23/2001]
(2A)  The Minister may at any time add to, vary or revoke any condition imposed under subsection (2).
[1/2007]
(3)  Any condition imposed under subsection (2) shall have effect notwithstanding any of the provisions of the Companies Act (Cap. 50) or anything contained in the memorandum or articles of association of the designated financial institution.
[23/2001]
(4)  Where the Minister disapproves an application made by any person under section 15A(2) or (4) or 15B(2), the person shall, within such time as the Minister may specify, take such steps as are necessary —
(a)
in the case of section 15A(2), to cease to be a substantial shareholder;
(b)
in the case of section 15A(4), to cease to be a party to the agreement or arrangement; or
(c)
in the case of section 15B(2), to cease to be —
(i)
a 12% controller;
(ii)
a 20% controller; or
(iii)
an indirect controller,
as the case may be.
[23/2001]
(5)  Notwithstanding the repeal of sections 15, 16 and 17 in force immediately before 18th July 2001, the following approvals granted by the Authority before that date shall continue and be deemed to be approvals granted by the Minister under this section, subject to such additional conditions as the Minister may at any time by notice in writing, impose:
(a)
any approval or condition imposed in relation thereto under the repealed section 15(2) shall be deemed to be an approval granted or a condition imposed under this section as if an application for approval had been made under section 15B(2)(b);
(b)
any approval or condition imposed in relation thereto under the repealed section 16(1) shall be deemed to be an approval granted or a condition imposed under this section as if an application for approval had been made under section 15B(2)(c); or
(c)
any approval or condition imposed in relation thereto under the repealed section 17(1) shall be deemed to be an approval granted or a condition imposed under this section as if an application for approval had been made under section 15A(2).
[23/2001]
Power to exempt and make further transitional provisions
15D.  The Minister may, by order published in the Gazette —
(a)
exempt —
(i)
any person or class of persons; or
(ii)
any class or description of shares or interests in shares,
from section 15A or 15B, subject to such terms and conditions as may be specified in the order; and
(b)
make such further transitional provisions as he considers necessary or expedient for the purposes of section 15A, 15B or 15C.
[23/2001]
Objection to existing control of designated financial institutions
15E.
—(1)  The Minister may serve a written notice of objection on any person referred to in section 15A or 15B if —
(a)
the Minister is satisfied that —
(i)
any condition of approval imposed on the person under section 15C has not been complied with;
(ii)
it is no longer in the national interest to allow the person to continue to be a party to the agreement or arrangement described in section 15A(3) or (4), or to continue to be a substantial shareholder, a 12% controller, a 20% controller or an indirect controller, as the case may be;
(iii)
the person has furnished any false or misleading information or document in connection with an application under section 15A or 15B; or
(iv)
he would not have granted his approval under section 15C had he been aware, at that time, of circumstances relevant to the person’s application for such approval; or
(b)
the Authority is satisfied that —
(i)
the person ceases to be a fit and proper person;
(ii)
having regard to the likely influence of the person, the designated financial institution is no longer likely to conduct its business prudently or to comply with the provisions of this Act; or
(iii)
it would not have been satisfied as to any of the matters specified in section 15C(1)(a) had it been aware, at that time, of circumstances relevant to the person’s application under section 15A or 15B.
[1/2007]
(2)  Before the service of a written notice of objection, the Minister shall, unless he decides that it is not practicable or desirable to do so, cause to be given to the person concerned notice in writing of his intention to serve the written notice of objection, specifying a date by which the person may make written representations with regard to the proposed written notice of objection.
[23/2001]
(3)  Upon receipt of any written representations, the Minister shall consider them for the purpose of determining whether to issue a written notice of objection.
[23/2001]
(4)  The Minister shall, in any written notice of objection, specify a reasonable period within which the person to be served the written notice of objection shall —
(a)
take such steps as are necessary to ensure that he ceases to be a party to the agreement or arrangement described in section 15A(3) or (4), or ceases to be a substantial shareholder, a 12% controller, a 20% controller or an indirect controller as defined in section 15B(3) and (5), as the case may be; or
(b)
comply with such direction or directions as the Minister may make under section 16.
[23/2001]
(5)  Any person served with a written notice of objection under this section shall comply with the notice.
[23/2001]
Power to make directions
16.
—(1)  Without prejudice to section 17, if the Minister is satisfied that any person has contravened section 15A, 15B, 15C(4) or 15E(5) or has failed to comply with any condition imposed under section 15C(2) or (5), or if the Minister has served a written notice of objection under section 15E, the Minister may, by notice in writing —
(a)
direct the transfer or disposal of all or any of the shares in the designated financial institution held by the person or any of his associates (referred to in this section as the specified shares) within such time or subject to such conditions as the Minister considers appropriate;
(b)
restrict the transfer or disposal of the specified shares; or
(c)
make such other direction as the Minister considers appropriate.
[23/2001]
(2)  Any person to whom a notice is given under subsection (1) shall comply with such direction or directions as may be specified in the notice.
[23/2001]
(3)  In the case of any direction made under subsection (1)(a) or (b), until a transfer or disposal is effected in accordance with the direction or until the restriction on the transfer or disposal is removed, as the case may be, notwithstanding any of the provisions of the Companies Act (Cap. 50) or anything contained in the memorandum or articles of association of the designated financial institution —
(a)
no voting rights shall be exercisable in respect of the specified shares unless the Minister expressly permits such rights to be exercised;
(b)
no shares of the designated financial institution shall be issued or offered (whether by way of rights, bonus or otherwise) in respect of the specified shares unless the Minister expressly permits such issue or offer; and
(c)
except in a liquidation of the designated financial institution, no payment shall be made by the designated financial institution of any amount (whether by way of dividends or otherwise) in respect of the specified shares unless the Minister expressly authorises such payment.
[23/2001]
(4)  In this section, “associate” has the same meaning as in section 15B(4)(c).
[23/2001]
Offences, penalties and defences
17.
—(1)  Any person who contravenes section 15A, 15B(1)(a) or (2)(a) or 15C(4)(a), (b) or (c)(i) shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
(2)  Any person who contravenes section 15B(1)(b) or (c), (2)(b) or (c), 15C(4)(c)(ii) or (iii), 15E(5) or 16(2), or who fails to comply with any condition imposed under section 15C(2) or (5), shall be guilty of an offence and shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
(3)  Where a person is charged with an offence in respect of a contravention of section 15A or 15B, it shall be a defence for the person to prove that —
(a)
he was not aware that he had contravened section 15A or 15B, as the case may be; and
(b)
he has, within 14 days of becoming aware that he had contravened section 15A or 15B, as the case may be, notified the Minister of the contravention and, within such time as determined by the Minister, taken such actions in relation to his shareholding or control of the voting power in the designated financial institution as the Minister may direct.
[23/2001]
(4)  Where a person is charged with an offence in respect of a contravention of section 15B(1), it shall also be a defence for the person to prove that, even though he was aware of the contravention —
(a)
the contravention occurred as a result of an increase in the shareholding as described in section 15B(4)(a) of, or in the voting power controlled by, any of his associates described in section 15B(4)(c)(i);
(b)
he has no agreement or arrangement, whether oral or in writing and whether express or implied, with that associate with respect to the acquisition, holding or disposal of shares or other interests in, or under which they act together in exercising their voting power in relation to, the designated financial institution; and
(c)
he has, within 14 days of the date of the contravention, notified the Minister of the contravention and, within such time as may be determined by the Minister, taken such action in relation to his shareholding or control of the voting power in the designated financial institution as the Minister may direct.
[23/2001]
(5)  Except as provided in subsections (3) and (4), it shall not be a defence for a person charged with an offence in respect of a contravention of section 15A or 15B to prove that he did not intend to or did not knowingly contravene section 15A or 15B, as the case may be.
[23/2001]
Power of Authority to obtain information
18.
—(1)  The Authority may, by notice in writing, direct any designated financial institution to obtain from any of its shareholders and to transmit to the Authority any information relating to its shareholders which the Minister or the Authority may require for the purpose of ascertaining or investigating into the control of shareholding or voting power in the designated financial institution, or exercising any power or function under sections 15A to 17, including information —
(a)
as to whether that shareholder holds any share in the designated financial institution as beneficial owner or as trustee; and
(b)
if he holds the share as trustee, to indicate as far as he can, the person for whom he holds the share (either by name or by other particulars sufficient to enable that person to be identified) and the nature of his interest,
and the designated financial institution shall comply with that direction within such time as may be specified in the notice.
[23/2001; 1/2007]
(2)  The Authority may, by notice in writing, require any shareholder of a designated financial institution, or any person who appears from information provided to the Authority under subsection (1) or this subsection to have an interest in any share in a designated financial institution, to provide to the Authority any information relating to the shareholder or the person, as the case may be, which the Minister or the Authority may require for the purpose of ascertaining or investigating into the control of shareholding or voting power in the designated financial institution, or exercising any power or function under sections 15A to 17, including —
(a)
whether he holds that interest as beneficial owner or as trustee, and if he holds the interest as trustee, to indicate as far as he can, the person for whom he holds the interest (either by name or by other particulars sufficient to enable that person to be identified) and the nature of his interest; or
(b)
whether any share or any voting right attached to the share is the subject of an agreement or arrangement described in section 15A(3) or (4) or 15B(4)(c)(ix), and if so, to give particulars of the agreement or arrangement and the parties to it,
and the shareholder or the person shall comply with that notice within such time as may be specified therein.
[23/2001; 1/2007]
(3)  Any person who —
(a)
fails to comply with a notice under this section; or
(b)
in purported compliance of the notice, knowingly or recklessly furnishes any information or document that is false or misleading in a material particular,
shall be guilty of an offence.
[23/2001; 1/2007]
(4)  Any person convicted of an offence under this section shall be liable on conviction —
(a)
in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)
in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
[23/2001]
Amendment of bank’s constitution
19.
—(1)  Every bank incorporated in Singapore shall, prior to the making of any amendment or alteration in the memorandum of association and articles of association or other instrument under which it is incorporated, furnish to the Authority particulars in writing of the proposed amendment or alteration.
(2)  Every bank whether incorporated inside or outside Singapore shall, within 3 months after the making of any amendment or alteration in the memorandum of association and articles of association or other instrument under which it is incorporated, furnish to the Authority particulars in writing (verified by a statutory declaration made by a senior officer of the bank) of the amendment or alteration.
(3)  Any bank which contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine of $2,500 for every day during which the offence continues after conviction.
[2/84; 23/2001]
Revocation of licence
20.
—(1)  The Authority may by order revoke a licence issued under this Act —
(a)
if the Authority is satisfied that the bank holding that licence —
(i)
has ceased to transact banking business in Singapore;
(ii)
has furnished information or documents to the Authority in connection with its application for a licence which is or are false or misleading in a material particular;
(iii)
if it is a bank incorporated outside Singapore, has had its licence or authority to operate withdrawn by the supervisory authority which is responsible, under the laws of the country or territory where the bank is incorporated, formed or established, for supervising the bank;
(iv)
proposes to make, or has made, any composition or arrangement with its creditors or has gone into liquidation or has been wound up or otherwise dissolved;
(v)
is carrying on its business in a manner likely to be detrimental to the interests of the depositors of the bank or has insufficient assets to cover its liabilities to its depositors or the public;
(vi)
is contravening the provisions of this Act;
(vii)
has been convicted of any offence under this Act or any of its directors or officers holding a managerial or executive position has been convicted of any offence under this Act; or
(viii)
has contravened any provision of the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011 or any Rules issued by the deposit insurance and policy owners’ protection fund agency under the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011; or
(b)
if, upon the Authority exercising any power under section 49(2) or the Minister exercising any power under Division 2, 3 or 4 of Part IVB of the Monetary Authority of Singapore Act (Cap. 186) in relation to the bank, the Authority considers that it is in the public interest to revoke the licence.
[2/84; 23/2001; 31/2005; 1/2007]
(2)  The Authority shall before revoking any licence under subsection (1) —
(a)
cause to be given to the bank concerned notice in writing of its intention to do so, specifying a date, not less than 21 days after the date of the notice, upon which the revocation will take effect; and
(b)
call upon the bank to show cause to the Authority why the licence should not be revoked.
(3)  When the Authority has revoked a licence under subsection (1), the Authority shall immediately inform the bank of the revocation.
(4)  Any bank whose licence has been revoked under this section shall have a right of appeal to the High Court against the order of revocation.
(5)  An order of revocation made by the Authority shall not take effect until the expiration of a period of 21 days after the Authority has informed the bank of the order.
(6)  If within that period the bank concerned gives due notice of appeal to the High Court, the order shall not take effect unless the order is confirmed by the Court or the appeal is for any reason dismissed by that Court.
(7)  The making of an appeal by a bank under this section shall in no way affect the exercise of any power by the Authority under section 49, 50, 51, 52 or 53, or the exercise of any power by the Minister under Division 2, 3 or 4 of Part IVB of the Monetary Authority of Singapore Act (Cap. 186), in relation to the bank.
[1/2007]
Effect of revocation of licence
21.
—(1)  Where an order of revocation becomes effective under section 20 —
(a)
notice of the revocation shall be published in the Gazette; and
(b)
the bank shall, as from the date of the notice, cease to transact any banking business in Singapore except as may be approved by the Authority for the purpose of winding up its banking business.
(2)  Subsection (1)(b) shall not prejudice the enforcement by any person of any right or claim against the bank or by the bank of any right or claim against any person.