International Banking Act - Vanuatu Financial Services Commission

LAWS OF THE REPUBLIC OF VANUATU
INTERNATIONAL BANKING
(6) The Reserve Bank may approve in writing an exposure for a licensee under subsection
(1) that exceeds the 25 percent limit in that subsection, if the licensee agrees to reduce the
exposure to within that limit within a period of time specified by the Reserve Bank.
(7) If a licensee contravenes subsection (1), the licensee is guilty of an offence punishable on
conviction by a fine not exceeding $250,000.
31. Restrictions on advances without security
(1) A locally incorporated licensee and each subsidiary must not:
(a)
(b)
(c)
make, or permit to be outstanding, unsecured advances or unsecured credit
facilities which in total exceed $200,000 or one percent of the value of the
licensee’s eligible capital (whichever is the higher); or
give any financial guarantees exceeding that amount without security; or
incur any other liability related to the business of banking exceeding that amount
without security;
to, or on behalf of, all or any of the following:
(d)
(e)
(f)
a director of the licensee or subsidiary whether the unsecured advances or credit
facilities, or guarantees or other liabilities, are obtained by or on account of the
director jointly or severally;
any partnership, body corporate or other body in which the licensee or subsidiary,
or any one or more of its directors, is a partner, director, manager, officer or
agent;
any partnership, body corporate or other body of which any one or more of the
licensee’s or subsidiary’s directors is a guarantor.
(2) If a locally incorporated licensee contravenes subsection (1), the licensee is guilty of an
offence punishable on conviction by a fine not exceeding $250,000.
(3) In this section:
director includes a spouse, father, mother, son or daughter of a director;
unsecured advances or unsecured credit facilities means:
(a)
(b)
(c)
advances or credit facilities made without security; or
if an advance or credit facility has been made with non-marketed securities - any
part of that advance or credit facility which at any time exceeds four fifths of the
licensee’s valuation; or
if an advance or credit facility has been made with any other security - any part of
that advance or credit facility which at any time exceeds four fifths of the market
value of the assets constituting that security.
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