Section 93 Any financial institution suspending the repayment of its due obligation shall immediately notify such suspension with reason thereof to the Bank of Thailand and shall not undertake any business unless a written permission is granted by the Bank of Thailand.

The Bank of Thailand shall appoint a financial institution examiner to investigate the circumstances under the first paragraph and shall, upon receiving the investigation report from the financial institution examiner, have power to order such financial institution to be placed under control, to order the closure of such financial institution or to issue any order as deemed appropriate.
The Bank of Thailand shall, upon ordering the closure under the second paragraph, propose the Minister of Finance to withdraw the license of such financial institution.

Section 94 No financial institution shall pay money, property or remuneration which would cause its capital fund to be lower than the required capital fund to be maintained under Section 30 as follows:

(1) to pay money or any other property to the shareholder as return distribution;
(2) to pay remuneration with respect to management or any other benefits that is not normal wage to director, manager or person with power of management.

The Bank of Thailand may permit a financial institution to repurchase, redeem, release, or acquire shares or benefits as a shareholder, to the extent that it will reduce financial obligation or to rectify financial condition of such financial institution.

Section 95 In the case where a financial institution maintains its capital fund lower than the required capital fund to be maintained under Section 30, such financial institution shall propose a project for rectifying its condition and operation to the Bank of Thailand for approval in accordance with the following rules:
(1) the project shall be proposed within sixty days from the date that financial institution becomes aware of the situation;
(2) the project under (1) shall at least consist of the following lists: (a) process to restore capital fund to an adequate level;
(b) level of capital fund expected to be maintained in each quarter during the project period;
(c) a business plan;
(d) timeline for completing the project which shall not exceed one year from the date on which the financial institution becomes aware that its capital fund is lower than the required capital fund under Section 30.

Upon receiving the project, the Bank of Thailand shall approve or disapprove the project within thirty days from the date of receiving the project and shall inform the financial institution within such period. In this regard, the Bank of Thailand may also prescribe any rule or time clause.

In the event that the financial institution fails to propose the project within the specified period under (1), or no approval is granted to the proposed project, or the financial institution fails to implement the project, or fails to proceed in accordance with the approved project or the rule or time clause stipulated by the Bank of Thailand under the second paragraph, the Bank of Thailand shall have power to order the financial institution to take any action as deemed appropriate or to order the closure of such financial institution.
The Bank of Thailand, upon ordering the closure under the third paragraph, shall propose to the Minister to withdraw the license of such financial institution.

Section 96 In the case where a financial institution maintains its capital fund lower than sixty percent of the ratio prescribed in Section 30, the Bank of Thailand shall order the financial institution to be placed under control except where the Bank of Thailand deems that such order would cause a severely adverse effect or damage to the economy as a whole or such financial institution would rapidly rectify its capital

fund to be maintained not lower than the ratio prescribed by law, the Bank of Thailand may not order to place the financial institution under control.
In addition to the proceeding under the first paragraph, the Bank of Thailand may order such financial institution to dissolve and liquidate its subsidiary if it appears that the assets of the subsidiary are insufficient for its liabilities or the subsidiary is unable to normally repay its debt for more than three consecutive months. The Bank of Thailand may issue any other order as deemed appropriate.

Section 97 In the case where a financial institution maintains its capital fund lower than thirty-five percent of the ratio prescribed in Section 30, the Bank of Thailand shall order the closure of such financial institution except where the Bank of Thailand deems that such order would cause a severely adverse effect or damage to the economy as a whole, the Bank of Thailand may not order the closure of the financial institution.

The Bank of Thailand, upon ordering the closure under the first paragraph, shall propose to the Minister to withdraw the license of such financial institution.

Section 98 When the Bank of Thailand has issued an order to close any financial institution in accordance with Section 90 (5), Section 93, Section 95 or Section 97 and the Minister has withdrawn the license, such financial institution shall be
liquidated.

Section 99 When the Bank of Thailand has issued an order to a financial institution to undertake any action or has received any report related to the financial institution under this Chapter, the Bank of Thailand shall report to the Minister without delay.

Chapter 6
The Control of Financial Institutions

Section 100 In this Chapter,

“Deposit Protection Agency” means the Deposit Protection Agency under the law on deposit protection agency.

Section 101 When the Bank of Thailand has issued an order to place any financial institution under control, it shall notify the order in writing to the Deposit Protection Agency and such financial institution. The notice of the order shall be posted in a public area at the premise of such financial institution and also be published in the Government Gazette and in any media in accordance with the rule as prescribed in the notification of the Bank of Thailand.

In the case where the financial institution under the first paragraph is a listed company in the Securities Exchange, the Bank of Thailand shall also notify the order in writing to the Securities Exchange.

Section 102 When the Bank of Thailand has ordered any financial institution to be placed under control, the Bank of Thailand shall issue a notification of the appointment of a Control Committee consisting of a chairman and other members of at least two but not exceeding four, provided that at least one member shall be proposed by the Deposit Protection Agency.

In the case where the chairman is unable to perform his duty, the Bank of Thailand shall issue a notification of the appointment of any member to be in charge.

Resolution of the committee is determined by a majority of votes. Each member shall have one vote. In the case of tie, the chairman shall be entitled to cast an additional deciding vote.

Section 103 Members of the Control Committee shall have the same qualifications and shall not possess the same prohibited characteristics as those of the director of a financial institution under Section 24, and shall have no conflict of interests with respect to their powers and duties as members of the Control Committee.

The Control Committee shall have the same power and duty as the director of the financial institution.

Section 104 When the Bank of Thailand has notified the control order to any financial institution, the director, officer and employee of such financial institution shall be prohibited from conducting further business of that financial institution unless authorized by the Control Committee.

The Control Committee shall have the power to appoint one or several control officers to perform any duty. The Control Committee has the power and duty to undertake all businesses of the financial institution placed under control. The chairman of the Committee shall be the representative of such financial institution.

The director, officer and employee of the financial institution placed under control shall:
(1) take actions in order to safeguard the company’s properties and interests of the financial institution;
(2) report the business and deliver the assets including information, account, document, seals or other evidences relating to the business and assets of the financial institution to the Control Committee without delay.

Any person in possessions of properties or documents of the financial institution shall notify the Control Committee thereof without delay.

Section 105 In the case where the Control Committee considers that the deposits of the financial institution placed under control bear higher than reasonable and fair interest rates the Control Committee with the approval of the Deposit Protection Agency Board shall have the power to reduce such interest rates, provided that the depositors shall be notified first and the reduction shall take effect after seven days from the date of the notification.

Section 106 In the case where the Control Committee deems that contractual obligations of the financial institution placed under control exceed due benefits, the Control Committee may negotiate with the asset owners, counterparties or relevant persons to reduce such obligations.

Section 107 In the case where the Control Committee deems that the employment contract of executives of the financial institution placed under control contains inappropriate conditions or stipulates higher than reasonable remuneration or benefits, or such financial institution incurs losses from the mismanagement or negligence of the executives, the Control Committee shall have power to dismiss, suspend or reduce the remuneration or benefits granted to such executives.

Section 108 In the case where the Control Committee deems that it is appropriate to have a merger or transfer of the business of the financial institution, the provisions in Division 9: Merger, Transfer and Dissolution of Chapter 3 shall apply to such merger or transfer of business mutatis mutandis. In this regard, the resolution of the Control Committee shall be deemed as a resolution of the shareholder meeting and the Control Committee shall have power to act on behalf of the board of directors of such financial institution.

Next Page

[1]  [2]  [3]  [4]  [5]  [6]  [7]  [8]  [9]  [10]  [11]  [12]  [13]