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The note reserve fund.
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62.—(1) The Commission shall keep a separate capital fund to be called the note reserve fund and shall maintain and manage such fund in accordance with this Act and shall pay into such fund all moneys which are by this Act required to be paid thereinto and shall pay out of such fund all moneys which are by this Act required to be paid thereout.
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(2) The capital of the note reserve fund shall be held by the Commission or at its disposal in such one or more of the following forms as the Commission in its absolute discretion shall think proper and in no other form, that is to say:—
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(a) gold bullion;
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(b) gold coins which are for the time being legal tender in Saorstát Eireann for unlimited amounts;
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(c) money in any form which is for the time being legal tender in Great Britain for unlimited amounts;
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(d) British Government securities;
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(e) securities guaranteed by the British Government;
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(f) sterling balances on current or deposit account at the London Agency or any Bank in Great Britain or Northern Ireland;
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(g) legal tender notes.
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(3) Subject to the restriction that not more than one-tenth of the capital of the note reserve fund may at any time be held in the form of legal tender notes the Commission shall in its absolute discretion determine from time to time as occasion requires the allocation of the capital of the note reserve fund amongst the several forms mentioned in the foregoing sub-section or any of them.
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(4) All dividends and interest received by the Commission in respect of the capital of the note reserve fund shall be carried as income to the general fund.
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(5) The Commission may, if and whenever it thinks fit, borrow temporarily for the purposes of the note reserve fund and may pledge the capital or any part of the capital of the note reserve fund as security for such borrowing and shall charge all interest on such borrowing against the general fund.
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(6) At the end of every half-year the Commission shall value in accordance with current market values the capital assets of the note reserve fund and shall ascertain the extent of the net deficiency, if any, of such capital assets as so valued (less by the capital amount of any temporary borrowing under the foregoing sub-section and the value of any capital assets then transferable to the legal tender note fund, but with the addition of any capital assets then transferable from the legal tender note fund) below one tenth of the maximum amount of consolidated bank notes which might under this Act be outstanding (otherwise than on an extraordinary issue) on the last day of such half-year and, if on any such ascertainment any such deficiency is found to exist, shall as soon as may be transfer to the note reserve fund from the general fund in any of the forms mentioned in sub-section (2) of this section an amount equivalent to whichever of the following amounts is the less, that is to say:—
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(a) the amount of such deficiency, or
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(b) one-fifth of the surplus of the total amount received by the Commission during such half-year on account of dividends and interest in respect of the capital of the legal tender note fund and the capital of the note reserve fund remaining after deducting from such total amount all (if any) interest payable during such half-year on any temporary borrowing for the purposes of either of such funds.
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