Banking Institutions, Mutual Building Societies and Building Societies Amendment Act
GOVERNMENT GAZETTE
OF THE REPUBLIC OF SOUTH AFRICA
REPUBLIEK VAN SUID-AFRIKA
STAATSKOERANT
Registered at the Post Office as a Newspaper As 'n Nuusblad by die Poskantoor Geregistreer
VoL. 285
No.448.
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CAPE TOWN, 15 MARCH 1989
KAAPSTAD, 15 MAART 1989 No. 11748
STATE PRESIDENT'S OFFICE KANTOOR VAN DIE STAATSPRESIDENT
15 March 1989 No. 448. 15 Maart 1989
It is hereby notified that the acting State President has assented to the following Act which is hereby published for general information:-
Hierby word bekend gemaak dat die waarnemende Staatspresident sy goedkeuring geheg het aan die onder- staande Wet wat hierby ter algemene inligting gepubli- seerword:-
No. 13 of 1989: Banking Institutions, Mutual Building Societies and Building Societies Amendment Act, 1989.
No. 13 van 1989: Wysigingswet op Bankinstellings, On- derlinge Bouverenigings en Bouve- renigings, 1989.
Please note that most Acts are published in English and another South African official language. Currently we only have capacity to publish the English versions. This means that this document will only contain even numbered pages as the other language is printed on uneven numbered pages.
2 No.ll748 GOVERNMENT G AZEITE, 15 MARCH 1989
Act No. 13, 1989 BANKING INSTITUTIONS, MUTUAL BUILDING SOCIETIES AND BUILDING SOCIETIES AMENDMENT ACT, 1989
GENERAL EXPLANATORY NOTE:
[ ] Words in bold type in square brackets indicate omissions from existing enactments.
Words underlined with solid line indicate insertions in exist- ing enactments.
ACT To amend the provisions of the Banks Act, 1965, so as to further regulate the prohibition on the carrying on of the business of a banking institution by unregistered institutions; to rectify an omission in the Afrikaans text of section 12 of the said Act; to further regulate the exercise of voting rights by a financial company and its associates in respect of shares held in a banking institution or bank controlling company; to make other provision with reference to the carrying on of banking business through an agent; to reformulate the powers of inspection of the Registrar of Banks; and to increase the penalty for a contravention of section 7 (1) or (2) of the Act; to amend the provisions of the Mutual Building Societies Act, 1965, so as to further regulate the requirements relating to the furnishing of information to depositors; and to set out more fully the prohibition relating to the purchase by officers of a mutual building society of property owned by or mortgaged to that society; and to amend the provisions of the Building Societies Act, 1986, so as to further regulate the require- ments relating to the furnishing of information to depositors; and to set out more fully the prohibition relating to the purchase by certain office-bearers and employees of a building society of property owned by or mortgaged to that building society; and to provide for matters connected therewith.
(English text signed by the acting State President.) (Assented to 7 March 1989.)
B E IT ENACTED by the State President and the Parliament of the Republic of South Africa, as follows:-
Amendment of section 7 of Act 23 of 1965, as amended by section 39 of Act 101 of 1976, section 13 of Act 106 of 1985 and section 4 of Act 96 of 1988
I. Section 7 of the Banks Act, 1965, is hereby amended by the substitution for 5 subsection (1) of the following subsection:
"(1) No person shall carry on the business of a banking institution unless that person has in terms of section 4 been registered or provisionally registered as a bank or a discount house, and no person other than a registered bank or bank controlling company shall without the consent of the Registrar acquire a 10 registered banking institution.".
Amendment of section 12 of Act 23 of 1965, as substituted by section 16 of Act 106 of 1985
2. Section 12 of the Banks Act, 1965, is hereby amended by the substitution, in the Afrikaans text, for paragraph (b) of subsection (2) of the following paragraph: 15
4 No.11748 GOVERNMENTGAZETIE, 15 MARCH 1989
Act No. 13, 1989 BANKING INSTITUTIONS, MUTUAL BUILDING SOCIETIES AND BUILDING SOCIETIES AMENDMENT ACT, 1989
"(b) in maklik leesbare letters op elke staat, kennisgewing, advertensie of brief wat uitgegee of aan enige lid van die publiek in die Republiek deur of namens die bankinstelling uitgereik word,".
Amendment of section 28D of Act 23 of 1965, as substituted by section 31 of Act 106 5 of 1985 and amended by section 12 of Act 96 of 1988
3. Section 280 of the Banks Act, 1965, is hereby amended by the addition to subsection (9) of the following proviso:
"Provided that the Minister may in a s ecial case, if he is satisfied that such a step is desirable in the public interest, approve that a financial company and its 10 associates may, either generally or on a particular occasion, exercise the voting rights attached to all the shares in the relevant banking institution or bank controlling company, as the case may be, which are registered in their names.".
Amendment of section 29 of Act 23 of 1965, as substituted by section 33 of Act 106 of 1985
4. Section 29 of the Banks Act, 1965, is hereby amended by the substitution, in 15 subsection (1), for the words preceding the proviso of the following words:
"A bank which has a branch system and which accepts money on deposit which is withdrawable by cheque and which has been admitted to the clearing house of banks, shall not carry on any business in the Republic through a person who is not its full-time servant, except with the written approval of the Registrar 20 and subject to such conditions as the Registrar may determine".
Substitution of section 39 of Act 23 of 1965
5. The following section is hereby substituted for section 39 of the Banks Act, 1965:
"Powers of inspection of Registrar 25
39. (1) In addition to the powers and duties conferred or imposed upon him by this Act, the Registrar shall, for the purposes of the performance of his functions under this Act have [all the] powers and duties [conferred or imposed upon him] in all respects corresponding to the powers and duties conferred or imposed by the Inspection of Financial Institutions 30 Act, [1962 (Act No. 68 of 1962)] 1984 (Act No. 38 of 1984), upon a registrar contemplated in the last-mentioned Act.
(2) Any reference in this Act to an inspection or investigation made under this section shall be construed as a reference to an inspection made [under] in accordance with the provisions of the Inspection of Financial 35 Institutions Act, [1962] 1984. " .
Amendment of section 49 of Act 23 of 1965, as amended by section 6 of Act 23 of 1970, section 32 of Act 86 of 1984 and section 36 of Act 106 of 1985
6. Section 49 of the Banks Act, 1965, is hereby amended by the substitution for subsection (7) of the following subsection: 40
"(7) Any person convicted of any offence under this Act (other than fraud or falsity) shall be Iiable- (a) in the case of the offence of contravening section 7 (1) or (2) , to a fine not
exceeding RlOO 000 or to imprisonment for a period not exceeding five years or to both such fine and such imprisonment; and 45
(b) in the case of any other offence, to a fine not exceeding [one] five thousand rand.". -
6 No.11748 GOVERNMENT GAZETIE, 15 MARCH 1989
Act No. 13, 1989 BANKING INSTITUTIONS, MUTUAL BUILDING SOCIETIES AND BUILDING SOCIETIES AMENDMENT ACT, 1989
Amendment of section 42 of Act 24 of 1965, as substituted by section 29 of Act 81 of 1986
7. Section 42 of the Mutual Building Societies Act, 1965, is hereby amended by the substitution for paragraph (a) of the following paragraph:
" (a) shall in writing and in a summarized form as approved by the registrar 5 inform a depositor [in writing] , when opening a savings account in his name, of the conditions applicable to such savings account;".
Substitution of section 46 of Act 24 of 1965, as substituted by section 29 of Act 81 of 1986
8. The following section is hereby substituted for section 46 of the Mutual Building 10 Societies Act, 1965:
"Disclosure of conditions applicable to transmission accounts
46. A society shall in writing and in a summarized form as approved by the registrar inform a depositor [in writing], when opening a transmis- sion account in his name, of the conditions applicable to transmission 15 accounts kept by that society.".
Substitution of section 48 of Act 24 of 1965, as substituted by section 29 of Act 81 of 1986
9. The following section is hereby substituted for section 48 of the Mutual Building Societies Act, 1965: 20
"Disclosure of conditions applic~ble to fixed deposits
48. Whenever any depositor invests an amount as a fixed deposit with a society, the society shall in writing and in a summarized form as approved by the registrar inform him [in writing] of the term, rate of interest and other conditions applicable to such fixed deposit.". 25
Amendment of section 76 of Act 24 of 1965, as amended by section 30 of Act 96 of 1988
10. Section 76 of the Mutual Building Societies Act, 1965, is hereby amended by the substitution for subsection (2) of the following subsection:
"(2) No officer of a society [or] and no firm in which such officer has a direct interest shall purchase or be interested in the purchase of any property or a right 30 to property owned by or mortgaged to the society and which is sold by or at the instance of the society or is sold at a judicial sale at the instance of any other person, unless the property is purchased at a duly advertised public sale or the sale is approved by the registrar.".
Amendment of section 58 of Act 82 of 1986
11. Section 58 of the Building Societies Act, 1986, is hereby amended by the substitution for paragraph (a) of the following paragraph:
"(a) shall in writing and in a summarized form as approved by the Registrar inform a depositor [in writing], when opening a savings account in his
35
name, of the conditions applicable to such savings account;". 40
Substitution of section 62 of Act 82 of 1986
12. The following section is hereby substituted for section 62 of the Building Societies Act, 1986:
"Disclosure of conditions applicable to transmission accounts
62. A building society shall in writing and in a summarized form as 45 approved by the Registrar inform a depositor [in writing], when opening
8 No.11748 GOVERNMENT GAZETTE, 15 MARCH 1989
Act No. 13, 1989 BANKING INSTITUTIONS, MUTUAL BUILDING SOCIETIES AND BUILDING SOCIETIES AMENDMENT ACT, 1989
a transmission account in his name, of the conditions applicable to transmission accounts kept by that building society.".
Substitution of section 64 of Act 82 of 1986
13. The following section is hereby substituted for section 64 of the Building Societies Act, 1986: 5
"Disclosure of conditions applicable to fixed deposits
64. Whenever any depositor invests an amount as a fixed deposit with a building society, the building society shall in writing and in a summar- ized form as approved by the Registrar inform him [in writing] of the term, interest rate and other conditions applicable to such fixed 10 deposit.".
Amendment of section 104 of Act 82 of 1986
14. Section 104 of the Building Societies Act, 1986. is hereby amended by the substitution for subsection (2) of the following subsection:
"(2) A director, alternate director, local director, local committee member or 15 employee of a building society or control company who, or a firm in which such a person has a direct intere~t and which- ( a) accepts from any person any benefit for or in connection with any advance
granted by that building society or by the building society in respect of which that control c.;ompany is registered; or 20
(b) otherwise than with the written consent of the Registrar or at a duly advertised public auction purchases any property or any right to property owned by or mortgaged to that building society or the building society in respect of which that control company is registered, and which is sold by or at the instance of the building society in question or is sold at a judicial sale 25 at the instance of any other person,
shall be guilty of an offence." .
Short title
IS. This Act shall be called the Banking Institutions, Mutual Building Societies and Building Societies Amendment Act , 1989. 30