Section 50 No financial institution shall grant credits, invest in, incur contingent liabilities or enter into transactions similar to credits granting to any one or several persons jointly in any project, or for the same purpose, at the end of any one day, in excess of twenty-five percent of any one or several types of its capital funds in accordance with the rule as prescribed in the notification of the Bank of Thailand.

With regards to the stipulation under the first paragraph, the Bank of Thailand may prescribe a specific amount of money or ratio lower than the prescribed ratio.

In the case of merger and acquisition of any financial institution, debts restructuring, selling or disposing of assets to an asset management company, or for any other appropriate reason, the Bank of Thailand may temporarily grant the financial institutions the exemption from compliance with the first paragraph.

In the case where the person under the first paragraph is a company, the amount of credits, investments, contingent liabilities or transactions similar to credits granting shall not exceed the ratio to the equity or capital funds of such company as prescribed by the Bank of Thailand unless exempted by the Bank of Thailand.

In the case where credits, investments, contingent liabilities or transactions similar to credit granting are made to any juristic person, the amount of credits, investments, contingent liabilities or transactions similar to credits granting made to the parent company, subsidiary and affiliate shall also be accounted as those made to such juristic person.

In the case where credits, investments, contingent liabilities or transactions similar to credit granting are made to any person, the amount of credits, investments, contingent liabilities or transactions similar to credit made to the related person shall be accounted as those made to such person.

Granting credits through purchasing, discounting or rediscounting bills under the first paragraph shall be deemed as granting of credits to the holder who sold the bills

and to the person who is liable to the bills at any step along the line except for those bills in accordance with the rule as prescribed in the notification of the Bank of Thailand.

In the case where any financial institution have a risk hedging from a financial institution or other companies against credits, investments, contingent liabilities, or transactions similar to credits granting in accordance with the rule as prescribed in the notification of the Bank of Thailand, it shall be deemed that such financial institution grants credit, invests, incurs contingent liability or enters into transactions similar to credits granting to the financial institution or company providing the risk hedging as mentioned under the first paragraph.

Section 51 No financial institution shall grant credits, invest, incur contingent liabilities or enter into transactions similar to credits granting to each type of business in excess of the ratio to its capital funds or assets as prescribed in the notification of the Bank of Thailand.

Section 52 The provisions under Section 50 and Section 51 shall not apply to a financial institution in the following cases:

(1) granting credits or incurring contingent liabilities not exceeding the amount that is guaranteed for the principal and interest by the Ministry of Finance;
(2) granting credits to or incurring contingent liabilities for the Financial Institutions Development Fund or the Bank of Thailand;
(3) investing by purchasing Thai Government securities, the Bank of Thailand securities, the Financial Institutions Development Fund securities, or the Deposit Protection Agency securities, securities issued by state enterprises established under specific laws, or securities guaranteed for the principal and interest by the Ministry of Finance, the Bank of Thailand, or the Financial Institutions Development Fund or the Deposit Protection Agency, but shall not exceed the par value;
(4) granting credits which are guaranteed by deposits at that financial institution, Thai Government securities, the Bank of Thailand securities, the Financial Institutions Development Fund securities or the Deposit Protection Agency securities, securities issued by state enterprises established under specific laws or securities guaranteed for the principal and interest by the Ministry of Finance, the Bank of Thailand, the Financial Institutions Development Fund or the Deposit Protection Agency, but shall not exceed the amount of such deposits guaranteed or the par value of such securities;
(5) underwriting of securities in accordance with the rule as prescribed in the notification of the Bank of Thailand;
(6) interbank lending in accordance with the rule as prescribed in the notification of the Bank of Thailand;
(7) granting credits, investment, incurring contingent liabilities or undertaking of transactions similar to credits granting, of which the risk is minimal or is equivalent to that of government securities in accordance with the rule as prescribed in the notification of the Bank of Thailand;
(8) issuing commercial letters of credit.

Division 5
Financial Business Group

Section 53 Financial business group is composed of financial institutions and other companies which undertake financial businesses or supporting businesses with the following characteristics:
(1) financial business group which is composed of a financial institution as the parent company and one or more companies as subsidiaries; or
(2) financial business group which is composed of a non-financial institution as the parent company and a financial institution as subsidiary. In this regard, there may be one or several subsidiaries as affiliates of such financial institution.

Section 54 No financial business group shall be established unless permitted by the Bank of Thailand in accordance with the rule as prescribed in the notification of the Bank of Thailand.

Section 55 The provisions under Section 16 to Section 22 shall apply to the holding or possessing of shares of the parent company of a financial institution mutatis mutandis.

The provision under Section 25 shall apply to the appointment of a director, a manager, a person with power of management or an advisor of the parent company of a financial institution and subsidiaries undertaking financial businesses of the financial
institution mutatis mutandis.

The provisions under the first and second paragraph shall not apply to the parent company or subsidiary of a financial institution in the case where there is a law which regulates the undertaking business of the parent company or subsidiary of the financial institution and has already prescribed specific rules for such matters.

Section 56 Companies of a financial business group shall undertake only financial business or supporting business as prescribed in the notification of the Bank of Thailand and shall not undertake any commercial or other businesses.

In undertaking financial business or supporting business under the first paragraph, the Bank of Thailand may prescribe in the notification rule for undertaking such business unless the law regulating such business has already prescribed specific rule for such
matters.

Section 57 For the purpose of the examination of the financial business group stability, the Bank of Thailand shall have the power to supervise and examine the financial institution, the parent company, subsidiary and affiliate of the financial institution as if it were the same juristic person in accordance with the rule as prescribed in the notification of the Bank of Thailand unless the law regulating such business has already prescribed specific rule for such matters.

In acting under the first paragraph, the Bank of Thailand shall have the power to prescribe the ratio of capital funds or equity of the financial business group in proportion to assets, liabilities, contingent liabilities or variables and any other risks, or to prescribe other ratios for the financial business group of the financial institution and shall have the power to stipulate the financial business group to disclose information among each other in accordance with the rule as prescribed in the notification of the Bank of Thailand.

Section 58 No financial institution shall establish or acquire a subsidiary unless permitted by the Bank of Thailand.

In granting the permission under the first paragraph, the Bank of Thailand may prescribe any other condition with which the financial institution and its subsidiary shall comply.

No financial institution shall purchase or possess shares of subsidiary with an aggregate value in excess of the ratio of the total capital funds or one or several types of capital funds in accordance with the rule as prescribed in the notification of the Bank of Thailand.

Section 59 A financial institution may grant credits or enter into transactions with their respective parent company, subsidiary or affiliate, but shall not grant credits or enter into transactions in excess of what prescribed in the notification of the Bank of Thailand unless permitted by the Bank of Thailand.

Transactions under the first paragraph shall include:
(1) purchase or sale of assets including assets with a repurchase agreement from the parent company, subsidiary or affiliate;
(2) receipt of securities issued by the parent company, subsidiary or affiliate as collateral in credit granting, issuance of letter of guarantee or issuance of letter of credit for the parent company, subsidiary or affiliate;
(3) any transaction beneficial to the parent company, subsidiary or affiliate . Any credit granting or transaction with related person of the parent company, subsidiary or affiliate shall be considered credit granting or transaction with such company.

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