XN000022-1985-06-07 — Page 5

JUNE 7, 1985

+THEN UNDER SECTION 6, ONE PROVISION WHICH CAN BE EXERCISED BY THE FINANCIAL SECRETARY, ANY UNCOMMERCIAL DISPOSAL OF ASSETS BY THE BANK IN THE LAST 12 MONTHS, ANY DISPOSAL NOT MADE IN GOOD FAITH AND IN THE ORDINARY COURSE OF THE BUSINESS, COULD BE DISREGARDED AND A CLAIM COULD BE BROUGHT AGAINST THE DIRECTORS, MANAGERS AND OFFICERS OF THE BANK IN RESPECT OF ANY SUCH DISPOSAL, AND SIMILARLY UNDER SUBSECTION (3), ANY BURDENSOME TRANSACTIONS ENTERED INTO BY THE COMPANY OVER THE LAST 12 MONTHS SIMILARLY COULD BE SET ASIDE.

+SO THEN UNDER SECTION 7, DIRECTORS ARE TO BE APPOINTED. THE SECRETARY FOR MONETARY AFFAIRS UNDER SUBSECTION (2) BECOMES THE CHAIRMAN AS SOON AS THIS BILL IS PASSED AND THE FINANCIAL SECRETARY HAS THE POWER TO APPOINT OTHER PERSONS TO ACT AS DIRECTORS OF THE COMPANY, MR THOMAS SAID.

UNDER SECTION 8, MR THOMAS SAID, WAS THE PROVISION FOR THE GUARANTEE A CRUCIAL PROVISION TO ENABLE THE BANK TO CONTINUE IN BUSINESS ON MONDAY MORNING.

UNDER SECTION 9, THERE WAS PROVISION FOR CLAIMS FOR COMPENSATION. +WHETHER OR NOT THOSE WILL PROVE TO BE VALUABLE CLAIMS IS QUITE A DIFFERENT THING. BUT IT WOULD BE IN MY SUBMISSION QUITE WRONG FOR THIS GOVERNMENT TO BE CONFISCATING ANY ASSETS WITHOUT ANY RIGHT TO CLAIM COMPENSATION, IF INDEED THOSE ASSETS HAVE A VALUE. AND THE METHOD IN WHICH THE COMPENSATION WILL BE ASSESSED WILL BE PROVIDED IN REGULATIONS WHICH THE GOVERNMENT, THROUGH THE FINANCIAL SECRETARY, HAS POWER TO MAKE TO GOVERN THE METHOD OF ASSESSING COMPENSATION, THE BASIS ON WHICH COMPENSATION SHOULD BE CALCULATED AND THE LIKE.

+SO SECTION 10 GIVES THE FINANCIAL SECRETARY POWER TO MAKE REGULATIONS PROVIDING FOR THE MANAGEMENT AND CONTROL OF THE COMPANY, SO HE WOULD, AS IT WERE THE SHAREHOLDER, BE IN A POSITION TO DIRECT THE MANNER IN WHICH THE BANK CARRIES ON ITS BUSINESS.

+SIMILARLY, UNDER SECTION 11, THE GOVERNOR HAS A POWER TO GIVE DIRECTIONS TO THE DIRECTORS OF THE COMPANY SO THAT IT CAN BE CERTAIN THAT THEY EXERCISE THEIR POWERS IN THE PUBLIC INTEREST.

+AND LASTLY, UNDER SECTION 12, BECAUSE THE BILL ITSELF DOES THINGS WHICH ARE IN PARTICULAR RESPECT INCONSISTENT WITH THE COMPANIES ORDINANCE OR THE BANKING ORDINANCE OR THE DEPOSIT-TAKING COMPANIES ORDINANCE, OR INDEED THE MEMORANDUM OR ARTICLES OF ASSOCIATION OF THE COMPANY, IT IS PROVIDED THAT THE PROVISION OF THIS ORDINANCE OVER-RIDE THOSE.

+SO IT IS THIS ORDINANCE WHICH HAS THE EFFECT OF TRANSFERRING THOSE SHARES, INSTALLING THE DIRECTORS AND ENSURING THAT THIS CORPORATION IS PROPERLY CONSTITUTED TO CARRY ON BUSINESS COME MONDAY MORNING, HE SAID.

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