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30 Dec 1999

Formal Consolidation | 1999 RevEd

Investments

31.—(1) A bank shall not acquire or hold any part of the share capital of, or otherwise have an interest in, any financial, commercial, agricultural, industrial or other undertaking exceeding in the aggregate 40% of that bank’s capital funds except such shareholding as the bank may acquire in the course of the satisfaction of debts due to it, which shareholding shall, however, be disposed of at the earliest suitable opportunity.

(2) This section shall not apply in respect of —

(a)	any shareholding approved in writing by the Authority in another bank or in a subsidiary company formed by the bank concerned for the carrying out of nominee, executor or trustee functions or other functions incidental to banking business; or
(b)	any shareholding approved by the Authority in any corporation set up for the purpose of promoting development in Singapore.

(3) Any bank which contravenes subsection (1) shall be guilty of an offence.

Informal Consolidation | Amended Act 23 of 2001

Limit on equity investments

31.—(1) No bank in Singapore shall acquire or hold any equity investment in a single company, the value of which exceeds in the aggregate 2% of the capital funds of the bank or such other percentage as the Authority may prescribe.

(2) This section shall not apply to —

(a)	any interest held by way of security for the purposes of a transaction entered into in the ordinary course of the business of the bank in Singapore;
(b)	any shareholding or interest acquired or held by a bank in Singapore in the course of satisfaction of debts due to it which is disposed of at the earliest suitable opportunity; or
(c)	any major stake approved under section 32.

(3) The Authority may, by regulations —

(a)	exempt any bank from subsection (1) in respect of any investment;
(b)	provide for the manner of valuation of investments for the purposes of compliance with this section; and
(c)	exclude the operation of this section in respect of any investment or class of investments which may be held by any bank, subject to such conditions as may be prescribed.

(4) Any bank which contravenes this section or fails to comply with any condition imposed or prescribed under this section 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 not exceeding $10,000 for every day or part thereof during which the offence continues after conviction.

(5) In this section, “equity investment” means any beneficial interest in the share capital of a company.

(6) The Authority may, by order published in the Gazette, modify the definition of “equity investment” in subsection (5).

[23/2001 wef 18/07/2001]

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