"Under the new structure, the MA would be responsible for administering all authorisation matters; the Financial Secretary would provide a check as MA would be required to consult him on important authorisation decisions such as suspension and revocation; and ExCo would act as the appellate body for hearing appeals against decisions made by the MA.
The spokesman emphasised that "this represents a significant improvement over the existing system. Under the present structure, there is no appeal against a decision of ExCo to refuse to grant, to revoke or to attach conditions to a banking licence. These decisions would be subject to appeal under the proposed structure."
The amendment also sets out new and additional criteria to be applied by the MA for authorisation, suspension and revocation. Thus, in circumstances where the MA's power to revoke becomes exercisable, the MA should have the power to suspend the authorisation of the institution concerned.
"This power, which already exists in respect of restricted licence banks and deposit-taking companies, would be extended to apply also to licensed banks, enhancing the tools available to the MA in dealing with banking crises," he said.
The spokesman pointed out that another major provision of the bill dealt with the powers of the MA to take control of an institution.
He explained that main objectives of the powers of control were to allow the MA, through a manager, to control the affairs, business and property of a troubled institution so that it can be nursed back to health, perhaps as a prelude to sale and to enable the MA to take quick action to safeguard the assets and maintain the fabric of the business until a liquidator can be appointed.
It was proposed that when the MA gave direction to appoint a manager to take control of an authorised institution, he should specify in the direction the objectives with which the manager was required to comply. This was intended to clarify the broad purpose of the manager's appointment, for example, safeguarding the interest of the depositors.
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