A202
Ord. No. 27/86
Commissioner
may vary liquidity ratio for particular authorized institutions.
Authorized institutions not to create certain
charges and
to notify
Commissioner of certain civil proceedings.
BANKING
105. (1) The Commissioner may, by notice in writing served on an authorized institution, vary the liquidity ratio specified in section 102(1) in relation to that institution by increasing or decreasing the ratio and, where the ratio is so varied, sections 102, 103 and 104 shall, in relation to that institution, apply as if the ratio specified in section 102(1) were the ratio as so varied.
(2) Where the Commissioner varies under subsection (1) the liquidity ratio of any authorized institution, he shall forthwith provide the Financial Secretary with particulars of the variation.
(3) An authorized institution aggrieved by a variation of the liquidity ratio contained in a notice under subsection (1) served on it by the Commissioner may appeal, by notice in writing served on the Commissioner and the Financial Secretary stating the grounds of the appeal, to the Financial Secretary against the variation, but that variation shall take effect immediately, notwithstanding that an appeal has been or may be made under this subsection.
(4) The Financial Secretary shall determine an appeal under subsection (3) by confirming, varying or reversing the variation of liquidity ratio the subject of the appeal.
106. (1) Subject to subsection (2), an authorized institution incorporated in Hong Kong shall not, except with the approval of the Commissioner, which approval shall be subject to such conditions as he may think proper to attach thereto, by whatever means cause the sum total of all amounts secured by way of charge over its assets (excluding contra items) to exceed per cent of the sum total of the value of those assets.
(2) Where, immediately upon the commencement of this Ordinance, the sum total of all amounts secured by way of charge over the assets (excluding contra items) of an authorized institution incorporated in Hong Kong exceeds 5 per cent of the sum total of the value of those assets, the institution shall be deemed to have an approval under subsection (1) until—
(a) the expiration of 3 months after that commencement, or such further period
as the Commissioner may allow in any particular case; or
(b) it receives an approval under subsection (1),
whichever first occurs.
(3) Where any civil proceedings have been instituted against any authorized institution incorporated in Hong Kong, irrespective of whether the proceedings have been instituted before, on or after the commencement of this Ordinance, the institution shall, if those proccedings materially affect, or could materially affect, the financial position of the institution, forthwith notify the Commissioner of those proceedings and provide the Commissioner with such particulars of those proceed- ings as he may require.
(4) Every director and every manager of an authorized institution which contravenes subsection (1) or (3) commits an offence and is liable-
(a) on conviction upon indictment to a fine of $200,000 and to imprisonment for 2 years and, in the case of a continuing offence, to a further fine of $10,000 for every day during which the offence continues; and
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6 months and, in the case of a continuing offence, to a further fine of $5,000 for every day during which the offence continues.
(5) For the purposes of subsections (1) and (2)—
"assets" includes assets outside Hong Kong;
"charge" includes lien, encumbrance, equitable interest and third party right; “value” shall have the same meaning assigned to it in section 79(1).
BANKING
PART XIX
UNINCORPORATED BANKS
Ord. No. 27/86
A203
107. (1) The Governor in Council may, for the purposes of and in accordance Grant of banking with section 115(2), grant a banking licence to carry on banking business in Hong licence to Kong to any unincorporated person or body of persons.
(2) A banking licence may be granted under subsection (1), notwithstanding that the unincorporated person or body of persons does not comply and does not propose to comply with the provisions of section 18, 75, 77, Part XVII or XVIII.
108. (1) An application for a banking licence under section 107 shall be made to the Governor in Council through the Commissioner.
(2) An application for a banking licence under section 107 shall be accompanied by such documents and information as the Commissioner or the Governor in Council may require.
unincorporated banks.
Application for banking licence under section 107.
fee for
109. (1) An unincorporated bank shall pay the annual banking licence fee Banking licence specified in the Second Schedule.
unincorporated
(2) The fees payable under this section shall be paid upon the grant of a banking bank. licence and thereafter upon every anniversary of the date of the grant of such banking Second Schedule. licence.
110. (1) Every unincorporated bank shall appoint annually an auditor.
(2) The duties of the auditor so appointed shall be---
(a) to carry out for the year in respect of which he is appointed an audit of the
accounts of the bank;
(b) to make a report to the directors of the bank on the audited accounts, the
balance sheet and the profit and loss account of the bank; and
(c) in every such report to state-
(i) whether or not all the information and explanations which were in the opinion of the auditor necessary for the purposes of the audit have been obtained;
(ii) whether or not, according to the best of the information and explanations given to him, the balance sheet and profit and loss account referred to in the report give in his opinion a true and fair view of the state of the affairs of the bank at the date of the balance sheet, and of the profit or loss for its financial year, regard being had, inter alia, to the provisions of this Ordinance;
(iii) whether or not in his opinion proper books of account have been kept by the bank so far as appears from the audit of the accounts; and
(iv) whether or not in his opinion proper returns, adequate for the purposes of the audit, have been received by him from branches of the bank not visited.
(3) Every director and every manager of a bank which contravenes subsec- tion (1) commits an offence and is liable-
(a) on conviction upon indictment to a fine of $200,000 and to imprisonment
for 2 years; or
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6
months.
Auditor.
111. (1) An unincorporated bank shall, subject to the provisions of this Part, be General deemed to be a bank for the purposes of this Ordinance.
application of
Ordinance to
(2) Any person to whom, and any member or partner of any unincorporated unincorporated body of persons to which, a banking licence is granted under section 107 shall be deemed for the purposes of this Ordinance to be a director of a bank.
banks and members.