Professional Documents
Culture Documents
As per Section 27 of the Bank Companies Act 1991, No Bank Company shall:
-Make any loans or advances against the security of its own shares
- Grant unsecured loan or advances to, or make loans and advances on the grantee of
a) Any Director;
b) Any family members of the Director;
a) Any firm, Private limited company in which any director of banking company is
interested as director, proprietor or partner;
b) Any public limited company which is managed by the director/family members of
the directors of banking company
(i) No banking company shall make loans or advances to any of its directors or to
individuals, firm, companies in which any of its directors is interested as
Partner, Director, Guarantor, as the case may be without the approval of
majority of the directors of the banking company excluding the director
concerned.
(ii) No banking company shall without the prior written approval of Bangladesh
Bank allow either directly or indirectly any such facility to any person or
institution which is
a) more than 15% of the total capital of that banking company
b) more than 25% of total capital of that banking company where such
facility is secured by easily sale able financial securities
The Managing director of every banking company shall submit return of loan/advances
within the following months.
If the Bangladesh Bank is satisfied that any loan and advances granted by any banking
company which is detrimental to the interest of the depositors, the Bangladesh bank may
-prohibits for such further loan
- impose any restrictions
- order to secure the repayment of such loan within a specific time.
Power of Bangladesh Bank to control Advances by Banking Companies: Sec-29:
The Bangladesh Bank may determine the policy relating to advances in the public
interest. All banking companies are bound to follow it.
Bangladesh Bank may give direction to any banking company in the following matters:
i)
ii)
iii)
iv.
v.
vi.
If any banking company makes any default for loan or advances, Bangladesh Bank may
order to deposit such amount to Bangladesh Bank and the Banking Company shall be
liable to follow the order.
The amount deposited to Bangladesh Bank may be released conditionally or
unconditionally as the Bangladesh may determine.
Circumstances under which Bangladesh Bank may supersede the Board of
Directors:
As per section-47 of Banking Companies Act-1991, Bangladesh Bank may
dissolve/supersedes the Board of Directors under the following circumstances:
(1)
Where the Bangladesh Bank is satisfied that(a) he activities of the Board of Directors, by whatever named called, of a
banking Company is likely to be detrimental to the interest of the
banking Company or its depositors or otherwise undesirable; or
(b) for all or any of the reason mentioned in sub-section (1) of section 46;
it is necessary to do so, the Bangladesh Bank may, for reason to be
recorded in writing, by order, supersede the Board of Directors of a
banking Company with effect from such date and for such period as
may be specified in the order.
(2)
(3)
All powers and duties of the Board of directors shall, during the period of
supersession, be exercised and performed by such person as the
Bangladesh Bank may from time to time appoint in this behalf.