373 LIMITS ON INVESTMENT IN THE EQUITIES OF FINANCIAL ALLIED UNDERTAKINGS

373 LIMITS ON INVESTMENT IN THE EQUITIES OF FINANCIAL ALLIED UNDERTAKINGS

The equity investment of a bank in a single financial allied undertaking shall be within the following ratios in relation to the total subscribed capital stock and to the total voting stock of the allied undertaking:

ACTIVITIES INVESTOR
Allied Enterprises UB KB TB RB Coop Banks
Financial Allied Undertaking Publicly- listed Not listed Publicly- listed Not listed
UBs 100% 49% 100% 49% 49% 49% 49%
KBs 100 49 100 49 49 49 49
TBs 100 100 49 49 49
RBs 100 100 49 49 100
Coop Banks NA NA NA NA 30
Insurance Companies 100 NA NA NA NA
VCCs 60 60 60 49 49
Trust Corporation 100 49 40 40 40
Others 100 49 40 40 40

To promote competitive conditions, the Monetary Board may further limit the equity investments in QBs of UBs and KBs to forty percent (40%).

A publicly-listed UB or KB may own up to 100% of the voting stock of only one (1) other UB or KB. Otherwise, it shall be limited to a minority holding.

The guidelines in determining compliance with ceilings on equity investments in financial allied undertakings are shown in Appendix 83.

(Circular No. 858 dated 21 November 2014)