Singapore legislation

Clause 8

of Banking Ordinance

Clause 8

Maintenance of reserve fund

(1)

Every licensed bank shall —

(a)

maintain a reserve fund; and

(b)

before any dividend is declared shall transfer to such fund out of the net profits of each year, after due provision has been made for taxation —

(i)

so long as the amount of the reserve fund is less than fifty per centum of the paid up capital, a sum equal to not less than fifty per centum of such net profits;

(ii)

so long as the amount of the reserve fund is fifty per centum but less than one hundred per centum of the paid up capital, a sum equal to twenty-five per centum of such net profits.

(2)

If the Minister is satisfied that the aggregate reserve fund of a licensed bank whose head office is situated outside Singapore is adequate for its business he may by order in writing exempt such bank from the provisions of subsection (1) of this section.

(3)

Any licensed bank which fails to comply with the provisions of subsection (1) of this section shall be guilty of an offence against this Ordinance.

Read in full context — Banking Ordinance →