47.
| (1) The provisions of this section shall apply wily to licensed commercial banks carrying on domestic banking business. |
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| (2) No licensed commercial bank shall grant accommodation against the security of
| | | (b) shares of companies which have a substantial interest in it; or | | |
| | (c) shares of companies in which the companies referred to in paragraph (b) have substantial interest. | | |
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| (3) No licensed commercial bank shall grant any accommodation. to any of its directors or to a close relation of such director, unless such security as may from time to time be approved by the Monetary Board, is given, and such accommodation is sanctioned at a meeting of the Board of Directors with not less than two thirds of the number of directors constituting the Board of Directors of the licensed commercial bank (other than the director concerned), voting in favour of such accommodation. |
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| (4) Accommodation granted by a licensed commercial bank to a director or to a close relation of such director shall not exceed the amount of the accommodation, if arty, extended to him or such close relation, and outstanding on the day prior to the date of his appointment as a director or on the day prior to the appointed date, whichever is later, or rupees five hundred thousand, whichever is more, and such accommodation is secured by such security as may from time to time he approved by the Monetary Board for the purposes of this section. |
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| (5) No licensed commercial bank shall grant accommodation to any concern in which, such director who on the day prior to the date of his appointment as a director or on the date prior to the appointed date, whichever is earlier, has a substantial Interest, unless such a security, as may from time to time be approved by the Monetary Board is given, and such accommodation is sanctioned at a meeting of the Board of Directors, with not less than two thirds of the number of directors constituting the Board of Directors of the licensed commercial bank (other than the director concerned), voting in favour of such accommodation. |
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| (6) Where any accommodation has been granted by licensed commercial bank to a person or a close relation of a person or to any concern in which the person has a substantial interest and if the person is a director of that licensed commercial bank on the appointed date or is appointed a director after the appointed date, steps shall be taken to obtain such security as may be approved for that purpose by the Monetary Board, within one year from the appointed date or from the date of appointment as director, whichever is applicable. |
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| (7) Where such security has not been, provided as specified in subsection (6), the licensed commercial bank shall take steps to recover any amount due on account of any accommodation together with interest, if any, due thereon
| | (a) within the period specified at the time of the grant of accommodation or at the expiry of a period of six months of the termination of the period specified in subsection (6), whichever is earlier ; | | |
| | (b) where no period has been specified, at the expiry of a period of one year of the termination of the period specified in subsection (6) : | | |
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| (8) Where no security has been provided within the period specified in subsection (6), or the amount due has not been repaid in tense of subsection (7) in respect of an accommodation granted to a director or to a concern in which the director has a substantial interest such Director shall be deemed to have vacated office on the expiry of the period specified in subsection (7). |
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| (9) Every director of a licensed commercial bank, who is in any manner whatsoever, whether directly or indirectly, Interested in any accommodation or proposed accommodation from that licensed commercial bank, shall as soon as is practicable, declare the nature of his interest to the Board of Directors and the Secretary or Manager of such licensed commercial bank shall cause the declaration to be circulated forthwith to all the directors, |
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| (10) A director shall not take part in any deliberations or decisions of the Board with regard to any business trans acted or proposed to be transacted by a licensed commercial bank in which the director or a close relation of the director, or a concern in which the director has a substantial interest, is interested, and the director shall withdraw from the meeting of the Board at which such business is discussed or transacted while the deliberation is in progress or decision is being made. |
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| (11) No accommodation or any part thereof granted by a licensed commercial bank to a director or to a close relation of the director or to a concern in which the director has a substantial interest shall be remitted without the prior approval of the Monetary Board, and any remission without such approval shall be void and of no effect. |
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| (12) Any director who contravenes the provisions of sub sections (9) and (10) shall be guilty of an offence under this Act. |
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| (13) For the purpose of this section |
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Sri Lanka Consolidated Acts