Building Societies Act, 1989
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FIFTH SCHEDULE Supplementary provisions in relation to a direction by the Central Bank under | ||
Direction by Central Bank. | ||
1. The Central Bank may revoke a direction given under section 40 (2) unless an order under paragraph 3 has been made by the Court in respect of the direction. | ||
2. A building society to whom a direction has been given under section 40 (2) may apply to the Court for, and the Court may grant, an order setting aside the direction. | ||
3. The Central Bank may apply to the Court for, and the Court may grant, an order confirming a direction or confirming it and, subject to paragraph 5, extending the period of its operation for such time, not exceeding the period of 12 months from the date the direction commenced to have effect, as the Court may, having regard to all the circumstances, consider appropriate. | ||
4. In addition to or in lieu of an order under paragraph 3 the Court may make such other order in the case 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 society, or a specified person, not to dispose of any of those assets except on such conditions and in such circumstances as are specified in the order. | ||
5. A direction which has been confirmed by the Court shall terminate— | ||
(a) at the end of the period of operation specified by the Court, | ||
(b) on the making by the Court of an order for termination on the application of the Central Bank, | ||
(c) on the making of a winding up order in respect of the society, or | ||
(d) on the making by the Court of an order for termination where the Court considers that the circumstances that gave rise to the direction have ceased to exist and that it would be unjust and inequitable not to make the order, | ||
whichever first occurs. | ||
6. If the Central Bank forms the opinion that the society to whom the direction was given is able to meet its obligations to its shareholders and creditors but the circumstances which gave rise to the direction are unlikely to be rectified, it shall forthwith apply to the Court for and the Court may grant an order directing the said society to prepare, in consultation with the Bank, a scheme for the orderly termination of its business and the discharge of its liabilities to its shareholders and depositors under the supervision of the Bank and to submit it to the Court within 2 months for approval. | ||
7. The Court shall not approve the terms of a scheme under paragraph 6 without hearing the Central Bank and, in the event of dispute about terms of the scheme, the Bank or the society may apply to the Court to adjudicate on the matter. | ||
8. If the society fails to comply with an order of the Court under paragraph 6 or fails to adhere to the scheme approved by the Court, the Central Bank may apply to the Court for and the Court may make such further order as it considers appropriate including an order of committal or for the winding up of the society on the ground that it is just and equitable that it be wound up. | ||
9. The Court may by order revoke or amend an order (except an order under paragraph 5) made by it under this Schedule. | ||
10. Where a direction is given by the Central Bank in accordance with section 40 — | ||
(a) the society to whom the direction has been given shall take all necessary steps to secure that its assets wherever held, are not depleted without the prior authorisation of the Bank; and | ||
(b) the Bank may direct a bank or any institution exempt under section 7 of the Act of 1971, which holds an account of the society to which the direction has been given, to suspend the making of payments from the account without the prior authorisation of the Bank. |