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Directions by Central Bank in relation to suspension of certain activities of trustee savings bank.
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26.—(1) Where the Central Bank is of opinion that it is in the public interest to do so or that a trustee savings bank—
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(a) has become or is likely to become unable to meet its obligations to its creditors, or
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(b) is not maintaining or is unlikely to be in a position to maintain adequate capital resources having regard to the volume and nature of its business, or
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(c) has failed to comply with a condition of its licence and the circumstances are such that the Central Bank is of opinion that the stability and soundness of the bank are affected by such failure, or
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(d) is conducting business in such a manner as to jeopardise and prejudice the security of deposits with the bank or the rights and interest of depositors with the bank, or
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(e) is under common control with one or more than one other enterprise (whether or not any such other enterprise is a trustee savings bank) and the Central Bank is of opinion that the common control is not in the interest of depositors with the first-mentioned trustee savings bank,
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the Central Bank may give a direction in writing to that bank to suspend, for such period not exceeding 6 months as shall be specified in the direction, all or any of the following, that is to say:
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(i) the carrying on of the business of a trustee savings bank,
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(ii) the making of payments (other than those to which subparagraph (i) relates),
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(iii) the acquisition or disposal of assets or the incurring or discharging of liabilities,
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which have not been authorised by the Central Bank.
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(2) The Central Bank may revoke a direction under subsection (1) unless an order under subsection (4) has been made in respect of the direction.
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(3) The Court may, on application to it in that behalf by the trustee savings bank concerned, make an order terminating a direction under subsection (1).
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(4) The Court may, on application to it in that behalf by the Central Bank make an order confirming a direction under subsection (1) or confirming the direction and, subject to subsection (5), extending the period of its operation for such time or times (but so that the period does not exceed 12 months) as the Court may, having regard to all the circumstances, consider appropriate.
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(5) A direction to which subsection (4) relates shall cease to have effect—
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(a) if the direction was confirmed, upon the expiration of the period to which the direction relates,
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(b) if the direction was confirmed and the period of its operation was extended, upon the expiration of that period as so extended,
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(c) upon the making of a winding up order in respect of the trustee savings bank concerned, or
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(d) where, on the application of the Central Bank or the trustee savings bank concerned, the Court is of opinion that the circumstances justifying the giving of a direction have ceased to exist and that it would be unjust and inequitable not to make an order terminating the direction, upon such date as the Court by order determines,
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whichever first occurs.
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(6) The Court may, in addition to or in lieu of making an order under subsection (3) or (4), make such other order in relation to the matter as may appear to it to be necessary including an order directing any person who holds money or other assets for or on behalf of the trustee savings bank to which the direction concerned relates not to dispose of any of those assets except on such conditions and in such circumstances as are specified in the order.
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(7) Where a direction under this section is in force, then—
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(a) winding up proceedings shall not be initiated in relation to the trustee savings bank concerned,
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(b) a receiver over the property of the bank shall not be appointed, and
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(c) the property of the bank shall not be attached, sequestered or otherwise distrained, or taken in execution,
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unless the prior approval of the Court has been obtained.
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(8) (a) Where the Central Bank becomes of opinion that, notwithstanding the fact that a trustee savings bank to which a direction has been given under this section appears to it to be able to meet its obligations to its creditors, the circumstances justifying the giving of the direction are likely to continue, it shall forthwith apply to the Court for, and the Court may grant, an order directing the bank to prepare, in consultation with the Central Bank, a scheme for the orderly termination of its business as a trustee savings bank and the discharge of its liabilities to its depositors under the supervision of the Central Bank and to submit the scheme to the Court within 2 months for the approval of the Court.
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(b) The Court shall not approve of a scheme under paragraph (a) without hearing the Central Bank and, if there is a dispute concerning the terms of the scheme, the Court may, on application to it in that behalf by the Central Bank or the trustee savings bank concerned, determine the matter.
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(c) If a trustee savings bank fails to comply with an order of the Court under this subsection or to carry out a scheme approved of by the Court under this subsection, the Court may, on application to it in that behalf by the Central Bank, make such further order in relation to the matter as it considers appropriate, including an order for the committal of the trustees of the bank or, if it considers it just and equitable to make it, an order for the winding up of the bank.
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(9) Where an order for the winding up of a trustee savings bank is made under this section, the law relating to companies (including this Act) shall apply as if the order had been made on a winding up petition under that law and as if for any reference in that law to the presentation of the winding up petition there were substituted a reference to the making of the order under this section.
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(10) Where the Court is satisfied that, because of the nature or circumstances of the case or otherwise in the interest of justice, it is desirable to do so, it may hear the whole or part of any proceedings under this section otherwise than in public.
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(11) The Court may by order revoke or amend an order made by it under this section.
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(12) For the purpose of subsection (1) (e) of this section a trustee savings bank and one or more than one other enterprise shall be deemed to be under common control if the decision as to how or by whom each shall be managed can be made by the same person or by the same group of persons acting in concert.
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(13) A trustee savings bank that fails or refuses to comply with a direction under this section shall be guilty of an offence.
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