Malaysia legislation
Section 35
Section 35
(2)
Subsection (1) shall not apply to any credit facility given—
(a)
to a licensed institution; or
(b)
to any other person engaged in the provision of finance who is approved in writing by the Minister.
(3)
A security in respect of a credit facility given to any person by the Bank shall consist of property of a value which is not less than the amount of the credit facility given to such person.
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Bank Simpanan Nasional Berhad
(4)
Where a security provided in respect of a credit facility given by the Bank is, during the currency of the credit facility, by agreement between the Bank and the person providing the security, substituted by a different security, the Bank shall ensure that the new security shall be of a value which is not less than the amount of the credit facility which is outstanding at the time of that substitution.
(5)
Where at any time during the currency of a credit facility, any security provided under subsection (3) or substituted under subsection (4) in respect of such credit facility decreases in value to a value which is less than the amount of the credit facility then outstanding, the Bank shall require the person to whom such credit facility is given to provide additional security so as to increase the value of the security to an amount which is not less than the amount of the credit facility then outstanding within a period not exceeding fourteen days, and if such additional security is not provided within such period, the person liable for the credit facility shall immediately thereupon be deemed to be in breach of the terms of the contract relating to the credit facility, and the Bank shall be entitled to enforce its rights under the contract in respect of a breach thereof.
(6)
Nothing contained in this section shall affect the right of the parties to the contract relating to the credit facility from including in such contract at the time at which it is entered into, or at any time thereafter, any provision relating to the security to be provided for the credit facility which is intended to ensure the sufficiency of the security throughout the currency of the credit facility.
(7)
For the purposes of this section, the value of any property which is provided as security shall be—
(a)
the market value thereof; or
(b)
where for any reason it is not possible to determine the market value thereof, the value approved by the Minister on an application by the Bank, which should set out the value arrived at by the Bank and the basis for it.
(8)
For the purposes of this section, the Minister may prescribe—
(a)
any limitations, restrictions and conditions subject to which any particular property, or any class, category or description of properties, may be provided or accepted as security;
or
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(b)
any particular property, or any class, category or description of properties, to be prohibited from being provided or accepted as security.
(9)
Where the Bank fails to comply with subsection (1), (4), (5)
or (8), it shall be guilty of an offence and shall on conviction be liable to a fine not exceeding five million ringgit.
(10)
Where the Bank is guilty of an offence under subsection (9), any person who at the time of the commission of the offence was a person responsible for the Bank shall also be guilty of that offence and shall on conviction be liable to a fine not exceeding five million ringgit or to imprisonment for a term not exceeding five years or to both.
Restriction of credit facility to single customer