Malaysia legislation
Section 73
Section 73
(a)
a licensed institution informs the Bank—
(i)
that it is insolvent;
(ii)
that it is likely to become unable to meet all or any of its obligations; or
Action by Bank in respect of licensed institution in certain circumstances.
(iii)
that it is about to suspend payment to any extent; or
(b)
whether after an examination under section 69 or 70, or otherwise howsoever, the Bank is satisfied that a licensed institution—
(i)
is carrying on its business in a manner detrimental to the interests of its depositors, or its creditors, or the public generally;
(ii)
is insolvent, or has become or is likely to become unable to meet all or any of its obligations, or is about to suspend payment to any extent; or
(iii)
has contravened any provision of this Act or the Ordinance, or any condition of its licence, or any provision of any written law, regardless that there has been no criminal prosecution in respect thereof, the Bank may, by order in writing, exercise any one or more of the following powers, as it deems necessary:
(A)
require the licensed institution to take any steps, or any action, or to do or not to do any act or thing, whatsoever, in relation to the institution, or its business, or its directors or officers, which the Bank may consider necessary and which it sets out in the order, within such time as may be set out therein;
(B)
prohibit a licensed institution from extending any further credit facility for such period as may be set out in the order, and make the prohibition subject to such exceptions, and impose such conditions in relation to the exceptions, as may be set out in the order, and, from time to time, by further order similarly made, extend the aforesaid period;
(C)
notwithstanding anything in any written law, or any limitations contained in the constituent documents of the licensed institution, for reasons to be recorded by it in writing, remove from office, with effect from such date as may be set out in the order, any officer of the licensed institution;
(D)
in respect of a licensed local institution, notwithstanding anything in any written law, or any limitations contained in the constituent documents of the licensed institution, and, in particular, notwithstanding any limitation therein as to the minimum or maximum number of directors, for reasons to be recorded by it in writing—
(i)
remove from office, with effect from such date as may be set out in the order any director of the licensed institution; or
(ii)
appoint any person or persons as a director or directors of the licensed institution, and provide in the order for the person or persons so appointed to be paid by the institution such remuneration as may be set out in the order; or
(E)
appoint a person to advise the licensed institution in relation to the proper conduct of its business, and provide in the order for the person so appointed to be paid by the institution such remuneration as may be set out in the order:
Provided that the powers of the Bank under paragraphs (B), (C), (D) and (E) shall be exercised only with the prior concurrence of the Minister.
(2)
Where any of the circumstances set out in paragraphs (a) and (b) of subsection (1) exist in respect of a licensed local institution, the Bank may, instead of exercising any of its powers under paragraphs (A), (B), (C), (D) or (E) of subsection (1), recommend to the
Minister to provide, and the Minister may on such recommendation accordingly provide, by order published in the Gazette-
(a)
for the Bank to assume control of the whole of the property, business and affairs of the licensed institution, and carry on the whole of its business and affairs, or to assume control of such part of its property, business and affairs, and carry on such part of its business and affairs, as may be set out in the order, or for the Bank to appoint any person to do so on behalf of the Bank, and for the costs and expenses of the Bank, or the remuneration of the person so appointed, as the case may be, to be payable out of the funds and properties of the institution as a first charge thereon;
(b)
whether or not an order has been made under paragraph (a), to authorise an application to be made by the Bank to the High Court to appoint a receiver or manager to manage the whole of the business, affairs and property of the licensed institution, or such part thereof as may be set out in the order, and for all such incidental, ancillary or consequential orders or directions of the High Court in relation to such appointment as may, in the opinion of the Bank, be necessary or expedient; or
(c)
where the institution is a licensed local institution, whether or not an order has been made under paragraph (a) or (b), to authorise the Bank to present a petition to the High Court for the winding up of the institution.
(3)
An order of the Bank under subsection (1), or an order of the Minister under subsection (2), may, from time to time, be modified, amended, altered, varied or replaced either prospectively, or where it is not impracticable or unjust to do so, retrospectively, by a further order under subsection (1) or (2), as the case may be.
(4)
No order under subsection (1) or (2), or by virtue of subsection (3), shall be made unless the licensed institution in respect of which the order is to be made, and in the case of an order under subsection (1) (C) or (D) (i), also the officer or director who is to be removed from office, has been given a reasonable opportunity of making representations against, or otherwise in respect of, the proposed order:
Provided that if in the opinion of the Bank, in the case of an order to be made by the Bank under subsection (1), or by virtue of subsection (3), or in the opinion of the Minister formed on the recommendation of the Bank, in the case of an order to be made by the Minister under subsection (2), or by virtue of subsection (3), any delay would be detrimental to the interests of the licensed institution, or its depositors or creditors, or the public generally, the order may be made first and the opportunity to make representations against or otherwise in relation to the order shall, in such case, be given immediately after the order has been made, and the order may, in consequence of such representations either be confirmed, or be modified, amended, altered, varied or replaced under subsection (3), or be revoked under subsection (5), subject to such conditions, if any, as the Bank, with the concurrence of the Minister, or the Minister, on the recommendation of the Bank, as the case may be, thinks fit to impose.
(5)
An order of the Bank made under subsection (1), or by virtue of subsection (3), or an order of the Minister made under subsection (2), or by virtue of subsection (3), may at any time be revoked by an order similarly made by the Bank, or by the Minister, as the case may be, and any such order may contain all such orders, directions or provisions of an incidental, ancillary, or consequential nature, as may be deemed necessary or expedient by the Bank or the Minister, as the case may be.