Asset Covered Securities Act, 2001
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Effect of revocation of registration where credit institution is not a company or building society or is a company or building society other than one that is being wound up. |
21.—(1) This section applies to a credit institution if the registration of the institution is revoked under section 19 and the institution— | |
(a) is not a company or building society, or | ||
(b) is a company or building society but is not being wound up. | ||
(2) A credit institution to which this section applies is required to continue to carry out the financial obligations of the institution that are secured under Part 7 until all of those obligations have been fully discharged to the satisfaction of the Authority. | ||
(3) Within such period as the Authority specifies (not exceeding 30 days) after the institution has been notified that its registration has been revoked, or within such extended period as the Authority may allow, the institution shall give to— | ||
(a) the Authority, and | ||
(b) as far as reasonably practicable, every creditor of the institution, | ||
a notice specifying the measures that it is taking or proposes to take to discharge in full its financial obligations. Those measures must include such measures as are designed to ensure that those obligations in respect of asset covered securities and cover assets hedge contracts will be fully discharged in accordance with the terms of the security documents governing those securities and contracts. | ||
(4) If— | ||
(a) the institution fails to give to the Authority a notice in accordance with subsection (3) within the required period, | ||
(b) the Authority believes that the institution has failed to take reasonable steps to give the notice to all of its creditors, or | ||
(c) the Authority does not believe that the measures specified in a notice given to it under that subsection are satisfactory, | ||
the Authority may, subject to Part 7, give the institution a direction in writing prohibiting the institution from engaging in a specified activity without having first obtained the Authority's permission. | ||
(5) The following activities are specified for the purposes of this section and section 20 — | ||
(a) dealing with the institution's assets generally or dealing with any specified class of assets or any specified asset, | ||
(b) engaging in transactions generally or engaging in any specified class of transactions or any specified transaction, | ||
(c) making payments generally or making any specified class of payments or any specified payment. | ||
(6) Subject to Part 7, the Authority may, either in a direction given under subsection (4) or in a later direction, require the institution concerned to prepare and submit to it for its approval within 2 months after the direction, a scheme for the orderly discharge of the institution's obligations to its creditors. |