Pu(B)182/83 BE IT ENACTED by the Duli Yang Maha Mulia Seri Paduka Baginda Yang di-Pertuan Agong with the advice and consent of the Dewan Negara and Dewan Rakyat in Parliament assembled, and by the authority of the same, as follows:
Part II — Licensing of islamic banks
(1) Islamic banking business shall not be transacted Islamic in Malaysia except by a company which is in the possession of a licence in writing from the Minister to be authorizing it to do so.
(2) A company which desires authority to carry on fslanec Islamic banking business in Malaysia shall apply in writing through the Central Bank to the Minister for a licence under this section and shall supply-
(a) a copy of the memorandum of association and articles of association or other instrument under which the company is incorporated, duly verified by a statutory declaration made by a senior officer of the company; and
(b) such other document or information as may be called upon by the Minister.
(3) Upon receiving an application under subsection
(2) the Central Bank shall consider the application and make a recommendation to the Minister stating whether a licence should be granted or not and the conditions, if any, to be attached to the licence.
(4) Upon receiving an application under subsection
(2) and the recommendation of the Central Bank under subsection (3), the Minister may, subject to section 4, grant a licence, with or without conditions, or refuse a licence.
(5) The Central Bank shall not recommend the grant of a licence, and the Minister shall not grant a licence, unless the Central Bank or the Minister, as the case may be, is satisfied-
(a) that the aims and operations of the banking. business which it is desired to carry on will not involve any element which is not approved by the Religion of Islam; and
[Pt. II, S. 3-5] las may appraved thie cantrey Bunte 10/214/03 ing, ain 1ax5-= Minister may vary or revoke condition of licence. Licence not to be granted in certain cases.
(b) that there is, in the articles of association of the bank concerned, provision for the establishment of a Syar'iah advisory bodylto advise the bank on the operations of its banking business in order to ensure that they do not involve any element which is not approved by the Religion esa) of Islam
(6) Any person who contravenes the provisions of this section shall be guilty of an offence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
(1) The Minister may at any time, on the recommendation of the Central Bank, vary or revoke any existing condition of a licence or impose conditions or additional conditions.
(2) The Minister shall, prior to any action under subsection (1), notify his intention in writing to take such action to the Islamic bank concerned and shall give the bank an opportunity to submit within such period, being not less than fourteen days, as may be specified in the notification reasons why the condition of the licence should not be varied or revoked or conditions or additional conditions should not be imposed.
(3) Where a licence is subject to conditions, the Islamic bank shall comply with those conditions.
(4) Any Islamic bank which fails to comply with any condition of its licence shall be guilty of an offence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit.
(1) No company shall be granted a licence under section 3 nor shall any company licensed thereunder carry on business in Malaysia without the written consent of the Minister if its capital funds unimpaired by losses or otherwise is less than the minimum amount.
(2) For the purposes of this section— "capital funds" means paid-up capital and reserves and any other sources of capital as may be defined and computed in such manner as may be prescribed by notice in writing from time to time by the Central Bank;
ociation of e establish- , advise the ng business ction shall be aysia Deposit nng errullly a term not d imprisonrecommenany existing ir additional ction under ing to take d and shall within such , as may be he condition ed or condile imposed iditions, the litions. ply with any i offence and ot exceeding icence under i thereunder the written s unimpaired num amount. and reserves e defined and rrescribed by Central Bank; IPt. II, S. 5-9] • "minimum amount" means such amount of capital funds to be maintained by an Islamic bank as may be the Central Bank by notification in the Gazette. prescribed by the Minister on the recommendation of + (46 407783
(3) The prescription of the minimum amount to be maintained under subsection (2) shall be complied with within such uniform period of grace being not less than three months as may be specified in the notification.
(i) No company shall be granted or shall hold a fvnianlicence if the Minister is satisfied that it is or has become banks. foreign-owned or controlled.
(2) For the purposes of this section, a company shall be deemed to be foreign-owned or controlled if fifty per centum or more of its capital issued and paid-up 2/71214/03 is owned by or on behalf of persons who are not citizens of Malaysia, or if a majority of the persons having the direction, control or management of the company are not citizens of Malaysia.
Except with the consent in writing of the Central Openins . Bank, no Islamic bank may open a new branch, agency branches. or office in any part of Malaysia or outside Malaysia.
(1) Subject to subsection (2), every Islamic bank may Islamic" establish a correspondent banking relationship with any bank may bank outside Malaysia. establish COTTeSpondent
(2) The Central Bank may prescribe by notice in relationship writing that no Islamic bank shall, except with the outside approval of the Minister on the recommendation of the Malaysia, Central Bank, establish a correspondent banking relationship with any bank established in any of the countries specified in the notification or with any bank owned or controlled by the government or an agency of the government of any such country.
Every Islamic bank shall pay to the Central Bank Licencefec. such annual licence fee as the Minister, on the recommendation of the Central Bank, may by notification in the Gazette prescribe.
of the use of certain words in an Islamic bank's name. Revocation of licence. dei, AiA1aIC 119,751755 IPt. II, 10-11]
Except with the consent in writing of the Minister ine ludes any of the wordoe Centrar, Com nameeyhich "Federal" "Federation" "Malaysian", "Nadioaal", "Rederve or"Sata ayier i 'e ational Language or in English or in any other language.
(1) Subject to subsection (2), if any Islamic bank—
(a) is pursuing aums, or carrying on operations, involvıng any element which is not approved by the Religion of Islam;
(b) is carrying on its business in a manner detrimental to the interests of its depositors and other creditors;
(c) has insufficient assets to cover its liabilities to the public;
(d) is contravening any provision of this Act; ot
(e) has ceased to carry on banking business in Malaysia,er i) nas. the Minister may, on the recommendation of the Central Bank, revoke any licence issued to such bank.
(2) The Minister shall, prior to any such revocation, notify his intention to take such action to the Islamic bank concerned and shall give the bank an opportunity to submit within such period, being not less than twenty-one days, as may be specified in the notification reasons why the licence should not be revoked.
(3) Where the licence of an Islamic bank has been reyoked under subsection (1), the bank may within thirty days of the revocation appeal against the revocation to the High Court, which may make such order thereon as it thinks proper, including any direction as to the costs of the appeal.
(4) The Central Bank shall be entitled to be heard on any such appeal.
(5) The making of an appeal under this section shall in no way affect the exercise of the powers and duties of the Central Bank under sections 37, 39 and 40.
the Minister name which ımonwealth" "Malaysian", the National nguage. lamic banka operations, iot approved nanner detriepositors and ; liabilities to his Act; er ank has been may with st the rev ke such order y direction as 1 to be heard s section shall ers and duties 1 and 40. [Pt. II-III, S. 12-14]
(1) Where an order of revocation becomes effective Effect of under section 11— revocation of licence.
(a) notice of the revocation shall be published in the Gazette; and
(b) the Islamic bank shall as from the date of the notice cease to transact any banking business in Malaysia except as may be approved by the :Minister on the recommendation of the Central Bank for the purposes of winding up of its banking business.
(2) The provisions of paragraph (b) of subsection (1) shall not prejudice the enforcement by any person of any right or claim against the bank or by the bank of any right or claim against any person.
The Central Bank shall cause to be published in Publication the Gazette in each year a list of all Islamic banks to Islamic which licences have been issued under this Act, and it banks. any licence is issued, revoked or surrendered during the interval between the publication of two such lists, notice thereof shall also be caused to be published in the Gazette. 13 A. .. us. by 17171214/03
Part III — Financial requirements and duties of islamic banks
(1) The Central Bank may require an Islamic bank Maintenanco to maintain capital funds, unimpaired by losses or fundp. of capital otherwise, in such proportion to such assets of its branches and offices both in Malaysia and outside Malaysia or only of its branches and offices in Malaysia as may be prescribed from time to time by the Central Bank by notice in writing
(2) "Capital funds" in subsection (1) shall have the meaning assigned to that expression in subsection (2) of section 5 but with such modifications as may be specified from time to time for the purposes of subsection (1) by the Central Bank by notice in writing.
[Pt. II, S. 15-16] Maintenance of reserve funds. Percentago of liquid assets. Sub,AHLSS
(1) Every Islamic bank- . (a) shall maintain a reserve fund; and
(b) before any dividend is declared shall transfer to the reserve fund out of the net profits of each year, atter due provision has been made for zakat or 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 the net profits;
(ii) so long as the amount of the reserve fund Is fiity per centum but less thar hundred per centum of the paid-up capital, a sum equal to not less than twenty-five per centum of the net profits.
(2) If the Central Bank is satisfied that the aggregate reserve fund of an Islamic bank is adequate for its business; it may by order in writing exempt the bank from. the provisions of subsection (1) for a period of one year.
(1) The Central Bank may from time to time prescribe by notice in writing to each Islamic bank a minimum amount or amounts of liquid assets to be held by the bank at all times.
(2) The minimum amount of amounts of the assets so prescribed to be held shall be expressed in the form
(a) a percentage or percentages which such assets shall bear to the sight, savings account, time and other deposit liabilities of each Islamic bank and such other liabilities thereof as may be determined by the Central Bank, either jointly or separately; and
(b) a percentage which such assets shall bear to the investment account of each Islamic bank; and such percentage or percentages may be varied by the Central Bank from time to time by notice in writing to the bank.
nd all transfer to rofits of each sen made for e reserve fund of the paid-up less than fifty its; e reserve fund ess than one the paid-up not less than le net profits. the aggregate equate for its mpt the bank I a period of time to time slamic bank a I assets to be : of thaits of the assets ised in the form all bear to the uertol as may Bank, either all bear to the nic bank; i be varied by stice in writing IPt. III, S. 16]
(3) Whenever the Central Bank issues a notice under subsection (1) each Islamic bank shall be allowed such uniform period of grace, being not less than one week, as may be specified in that notice in which to comply with the provisions thereof.
(4) An Islamic bank shall not, during any period in which it has failed to comply with any notice under subsection (1), without the approval of the Central Bank, lend or advance any money to any person.
(5) For the purpose of computing the minimum amount or amounts of liquid assets under this section and the sight, savings account, investment account, LIslamic time and other deposit liabilities of an Islamic bank carrying on business in Malaysia and elsewhere and deposil RAIAES' such other liabilities of such bank as may be determined by the Central Bank, the offices and branches of such bank in Malaysia shall be deemed to constitute a separate bank carrying on business in Malaysia.
(6) For the purposes of this section liquid assets shall be-
(a) notes and coin which are legal tender in Malaysia;
(b) balances at the Central Bank, not including the reserve specified in paragraph (c) of subsection
(1) of section 37 of the Central Bank of Malaysia Ordinance 1958; 61/58.
(c) investment certificates issued under the Government Investment Act 1983; and Act275.
(d) such other assets as may be approved by the Minister on the recommendation of the Central Bank.
(7) The Central Bank may by notice in writing require each Islamic bank to render such return or returns as the Central Bank deems necessary for the implementation of this section.
(8) Any Islamic bank which fails to comply with any of the provisions of this section shall be liable to pay, on being called upon to do so by the Central Bank, a penalty of not more than one-tenth of one pey dertiun of the amdencieney eodeiniency for every
Auditor and auditor's report. Act 125. Act 125. [Pt. II, S. 16-17]
(9) Any Islamic bank which fails or refuses to pay a penalty under subsection (8) shall be guilty of an offence under this Act.
(1) Notwithstanding the provisions of the Companies Act 1965, every Islamic bank shall appoint annually an auditor approved by the Minister.
(2) The Minister on the recommendation of the Central Bank may appoint an auditor——
(a) if the Islamic bank fails to appoint an auditor; or
(b) if he considers it desirable that another auditor should act with the auditor appointed under subsection (1), and may fix the remuneration to be paid by the Islamic bank to that auditor.
(3) The duties of the auditor appointed under subsections (1) and (2) for an Isiamic bank shall be-
(a) to carry out for the year in respect of which he is appointed an audit of the accounts of the bank; and
(b) to make a report in accordance with section 174 of the Companies Act 1965 upon the annual balance sheet and profit and loss account of the bank.
(4) The report of the auditor referred to in paragraph
(b) of subsection (3) shall be laid together with the report of the directors of the Islamic bank at the annual general meeting of the bank; and a statutory declaration made by a senior officer of the bank to the effect that the report was so laid shall accompany the documents forwarded under paragraph (c) of subsection (1) of section 18. 5) No person having an interest in an Islamic banl therwise than as a shareholder, and no director oi oflicer of that bank, shall be eligible for appointment as an auditor for that bank; and any person appointed as auditor to an Islamic bank who after such appointment acquires such interest or becomes a director or an officer of that bank shall forthwith cease to be the auditor.
uses to pay suilty of an E the Com-. all appoint iter. tion of the t an auditor; sther auditor pinted under y the Islamic d under suball bet of which he :ounts of the th section 174 in the annual iccount of the › in paragraph ther with the bank at the id a statutory le bank to the ccompany the 1 (c) of sub- 1 Islamic bank 1o director or r appointment ison appointed such appoint- .director or an :ase to be the [Pt. III, S. 17-18]
(6) The duties, powers and liabilities imposed anc conferred by section 33 in relation to an investigatiot by the Central Bank of the affairs of an Islamic bank under section 31 or 32 are hereby imposed and conferred in relation to auditors appointed under this section.
(7) Any Islamic bank which fails to comply with the requirements of subsection (4) shall be guilty of an ottence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit.
(1) Every Islamic bank shall-
(a) exhibit in a conspicuous position in every office or place of business in Malaysia-
(i) a copy each of its latest audited annual balance sheet, profit and loss account, togeiher with any note thereon, and the report of the auditor;
(ii) the full names of all its directors; and
(iii) the names of all subsidiaries for the time being of the bank;
(b) within fourteen days of the laying of accounts at its annual general meeting publish in at least two daily newspapers published in Malaysia and approved by the Central Bank a copy each of its latest audited annual balance sheet, profit and loss account, together with any note thereon, and the report of the auditor; and
(c) within six months after the close of each financial year or such further period as the Central Bank may approve, forward to the Central Bank—
(i) two copies each of its latest audited annual balance sheet, profit and loss account, together with any note thereon, and the reports of the auditor and the directors;
(ii) in the case of an Islamic bank with branches outside Malaysia, two copies each of its latest audited annual balance sheet and profit and loss account in respect of its operations in Malaysia, and Audited balance
: [Pt. III, S. 18-19] Statistics to be furnished. . ACT 276 two copies each of its latest audited annual balance sheet and profit and loss account in respect of its operations in each country outside Malaysia.
(2) The form and content of the balance sheet and profit and loss account shall, together with the report of the directors, be as approved by the Central Bank.
(3) The Central Bank may require any Islamic bank to submit such further or additional information as it sheets and profit and loss accounts forwarded by that bank under paragraph (c) of subsection (1) and that information shall be submitted within such period and in such manner as the Central Bank may require. 4) Any Islamic bank which fails to comply with th rovisions of this section shall be guilty of an offenc and shall on conviction be liable to a fine not exceeding twenty thousand ringgit.
(1) Every Islamic bank shall send to the Central Bank in such form as may be prescribed by the Central Bank-
(a) a statement showing the liabilities and assets of its banking offices and branches in Malaysia at the close of business on the last business day of each month within such period as may be prescribed by notice in writing from time to time by the Central Bank;
(b) a statement giving an analysis of loans, advances and investment of its banking offices and branches in Malaysia as at such intervals and within such period as may be prescribed by notice from time to time by the Central Bank;
(c) not later than six months after the close of its and expeneditura in respec or its bisines in Malaysia;
(d) notwithstanding the provisions of subsection (3) of section 34, ă statement showing such credit information of its customers as is required for the purposes of the credit bureau established -
IDIALIIIV ULiNAN ormation as it explanation, o the balance arded by that . (1) and that ch period and y réquire. mply with the of an offence not exceeding o the Central by the Central 3 and assets of in Malaysia at : business day od as may be from time to sis of loans, ›anking offices such intervals be prescribed y the Central he close of its ig the incomts business i :subsection (3) ng such credit is required for au established [Pt. III-IV, S. 19-21] 19' under section 30 (1) (mmm) of the Central Bank 61/58 of Malaysia Ordinance 1958 at such intervals and within such period as may be prescribed by notice in writing from time to time by the d Central Bank; and D/Act330 - Ael 330 e) any such statıstical information as may b equested by the Central Banl tirre(do)
(2) Except for the purposes of paragrapho(d),of sub- . Ac$330 section (1), any information received from a bank under Lparagraphi this section shall be regarded as secret between that
(d) 901145.s bank and the Central Bank.
(3) Any Islamic bank which fails to comply with any requirement set out in subsection (1) shall be guilty of an offence and shall on conviction be liable to a fine ot exceeding four thousand ringgit for every da uring which the default continue
(4) It shall be the responsibility of the Central Bank to prepare and publish consolidated statements aggregating the figures in the returns furnished under paragraphs (a) and (b) of subsection (1).
An Islamic bank which operates branch offices or Information Bank any inforn Miol reia isha 1o the ope ratines oe sucal brahnee offices or agencies as may be requested by the Central Bank.
Part IV — Ownership, control and management of islamic banks
(1) Whenever a change is about to occur in the Information control of any Islamic bank, the bank shall report the in cotroi proposed change to the Central Bank. of Islamic
(2) Whenever a loan or advance is made by any Banking Act 1973 incorporated in Malaysia or of any Act 102 finance company licensed under the Finance Companies Actó Act 1969, the Islamic bank shall report the fact to the Central Bank.
Sanction for recons• truction, etc., of bank required. IPt. IV, S. 21-22)
(3) The reports required to be made under subsection (2) shall contain the following
(i) the names and addresses of the borrowers; (i1) the name of the Islamic bank, the licensed bank, or finance company issuing the shares by which the loan or advance is secured;
(iii) the number of shares by which the loan or advance is secured; and
(iv) the amount of the loan or advance.
(4) The reports under subsections (1) and (2) shall be in addition to any report which may be required pursuant to the provisions of any other written law.
(5) For the purposes of this section, the expression "'ossessio diretay or indire lly or iche pok en to direbe or cause the direction of the management and policy of the bank.
(6) Any Islamic bank which fails to comply with the provisions of subsection (1) or (2) shall be guilty of an offence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit.
(1) Every Islamic bank shall obtain the approval of the Minister of any proposed-
(a) arrangement or agreement—
(i) for the sale or disposal of its shares or business; of
(ii) affecting voting power, management or other matters, which will result in a change in the control or management of the bank; and
(b) scheme-
(i) for reconstruction of the bank; or
(ii) for amalgamation, merger or otherwis between the bank and any other cor poration, wherein the whole or any part of the underlaking or the property of the bank is to be transferred to another corporation.
: under subine loan or ie. and (2) shall •be required vritten law. ze expression k means the wer to direct it and policy comply with all be guilty e liable to a it. the approval its shares or nagement or he control or nk; or or otherwise y other corif the underank is to be n. [Pt. IV-V, S. 22-24]
(2) The Minister, on the recommendation of the Central Bank, may approve or refuse to allow the proposed arrangement, agreement or scheme, but the approval of the Minister shall not be unreasonably withheld. 13) Subsechan.. L-ins,hn1S5
(1) Without prejudice to anything contained in the bin oa ifica- Companies Act 1965, any person who is a director, directors manager, secretary or other officer concerned in the and employees management of an Islamic bank shall cease to hold of banks. office- Act 125.
(a) it he becomes a bankrupt, suspends payment or compounds with his creditors; or
(b) if he is convicted of an offence involving dishonesty or fraud.
(2) No person who has been a director of, or directiy concerned in the management of, an Islamic bank or licensed bank under the Banking Act 1973 which has Act 102. been wound up by a court shall, without the express authority of the Minister, act or continue to act as a director of, or be directly concerned in the management of, any Islamic bank.
(3) Any person who acts in contravention of subsection (1) or (2) shall be guilty of an offence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
Part V — Restrictions on business
(1) No Islamic bank shall-
(a) pay any dividend on its shares until all its Restrictions on payment not represented by tangible assets) has been
(b) the seamity ofits ovan or er,dir facility against
[Pr. V, S. 24-25) Act 125. Act 102. Aci6. sups. ÁAC34 Prohibition of loans, etc., to directors, officers and employees. unsecured loans or
(c) grant unsecured advances' in excess of, in the unsecured credit facilities aggregate and outstanding at any one time, ten thousand ringgit to any corporation which is deemed to be related to the bank as described in section 6 of the Companies Act 1965, other than an Islamic bank, a licensed bank under the Banking Act 1973, a finance company licensed under the Finance Companies Act 1969, or any other financial institution approved by the Central Bank.
(2) For the purpose of this section "unsecured advances", "unsecured loans" and "unsecured credit facilities" mean respectively advances, loans and credit facilities made without security, or, in respect ot any advance, loan and credit facility made with security, any portion thereof which at any time exceeds the market value of the assets constituting the security or, where the Central Bank is satisfied that there is no established market value, the value made on the basis of a valuation approved by the Central Bank.
(1)/Exeept as-provided-under paragraph (c)-of subsection -(1)-of section 24-and-subsection (2) of this section, no Islamic bank shall grant advances, loans or credit facilities to-
(a) any of its directors, officers or employees or other persons being persons receiving remuneration from it (other than accountants, advocates and solicitors, architects, estate agents, doctors and any other persons receiving remuneration from it in respect of their professional services);
(b) any firm in which any of its directors, officers or employees is interested as partner, manager, agent or guarantor;
(c) any corporation in which any of its officers or material interest as determined by the Central Bank;
1 loans or of, in the one time, tion which 3 described 965, other ank under company ›anies Act institution 'unsecured ired credit and credit ect of any h security, xceeds the ecurity or. ere is ne n the basis
(e)-of-sub- ()) of thin ral Bank with ded for under Iployees or ig remuneants, advoate agents, ving remu- ›rofessional ars, officers r, manager, i officers or , agent o • shares of ees has any the Centrãl IPt. V, S. 25]
(d) any corporation in which any of its directors (not being an executive director, he being within the ambit of the provisions of paragraph (c) pursuant to subsection (3)) is a member, director, manager, agent or guarantor, or any corporation in the shares of which any such director of the Islamic bank has any interest whatsoever directly or indirectly; or
(e) any individual for whom any of its directors, officers or employees is a guarantor.
(2) An Islamic bank may grant to any of its officers or employees loans which are provided under its appropriate soheme of service and, where the bank is satisfied that special or compassionate circumstances exist, a loan not exceeding at any one time six months' remuneration of that officer or employee on such terms and conditions as the bank thinks fit.
(3) The provisions of paragraph (c) of subsection (1) and of subsection (2) shall also apply to the executive directors of Islamic banks.
(4) The provisions of paragraph (d) of subsection (1) shall not apply to the granting of advances, loans or credit facilities by an Islamic bank to-
(a) a corporation which is listed on a recognized stock exchange and in the shares of which no director of that Islamic bank has, directly or indirectly, any material interest as determined by the Central Bank; and
(b) a public company in which a director of that Islamic bank has no interest in his personal capacity, as determined by the Central Bank : Provided that for the purposes of this subsection the director concerned is not an executive director of that Islamic bank.
(5) For the purposes of this section, "director", "officer" or "employee" includes a spouse, parent or child of a director, an officer or employee.
on grant of loan, advance or credit facility under section 25 (4). [Pt. V, S. 26-27]
No Islamic bank shall grant any advance, loan or credit facility under the exemption referred to in subsection (4) of section 25 unless the following conditions are satisfied:
(a) that the advance, loan or credit facility meets the standards of credit-worthiness required of other appllcant borrowers;
(b) that the terms of the advance, loan or credit facility are not less favourable to the bank than those offered to others;
(c) that the grant of the advance, loan or credit facility will serve the best interest of the bank; and
(d) that the advance, loan or credit facility has been approved by the votes of not less than twothirds of all the other directors of the bank at a duly constituted meeting of the full board of directors and the approval has been recorded in the minutes of that meeting. of credit to single customer.
(1) No Islamic bank shall grant any customer any credit facilities or incur any other liabilities on his behalf to an aggregate amount in excess of such percentage as may be determined from time to time by the Central Bank in relation to such bank's capital funds unimpaired by losses or otherwise.
(2) Subsection (1) shall not apply to-
(a) transactions with other Islamic banks, with Act 102. licensed banks under the Banking Act 1973 and with finance companies licensed under the Act 6. Finance Companies Act 1969;
(b) any facilities granted in respect ot imports into or exports from.Malaysia or trade within Malaysia against letters of credit or bills of exchange; or
(c) any other transactions which the Central Bank may approve from time to time.
(3) For the purposes of subsection (1), the expression "capital funds" shall have the meaning assigned to it by subsection (2) of section 5. bld.AAL3H→2TA.--
ace, loan or 1 to in sub- 3 conditions cility meets required of ın or credit e bank than ın or credit of the bank; Lity has been s than twnemployee of any advance, i the limnit of 1y directions section, the ce direct an information edure for the credit facility, athority of a of the Islamic from time to :r shall have ank to amend = Islamic bank , loan or credit if authority in enes any of the any directions ste foa one noe ringgit or to exceeding three imprisonment.l IPt. V, S. 28]
(1) Every director of an Islamic bank who is in any Disclosure manner whatsoever, whether directly or indirectly, by direcsos. interested in an advance, loan or credit facility or proposed advance, loan or credit facility from that Islamic bank shall as soon as practicable declare the • nature of his interest to the board of directors of that Islamic bank and the secretary of that Islamic bank shall cause such declaration to be circulated forthwith to all the directors. n any hesreguirem the onf suet of on e d fhallr conpl only in being a member or creditor of a corporation which is interested in an advance, loan or credit facility or proposed advance, loan or credit facility from that Islamic bank if the interest of the director may properly be regarded as not being a material interest.
(3) For the purposes of subsection (1), a generalnotice given to the board of directors of an Islamic bank by a director to the effect that he is an officer or member of a specified firm or a member of a specified corporation and he is to be regarded as interested in any advance, loan or credit facility which may, after the date of the notice, be made to that firm or corporation shall be deemed to be a sufficient declaration of interest in relation to any advance, loan or credit facility so made if-
(a) it specifies the nature and extent of his interest in à specified firm or corporation;
(b) his interest shall not be different in nature or greater in extent than the nature and extent so specified in the notice at the time any advance, loan or credit facility is made; and
(c) it is given at the meeting of the directors or the director takes reasonable steps to ensure that it is brought up and read at the next meeting of the directors after it is given.
(4) Every director of an Islamic bank who holds any difrectly or mosiestey dinties or interest migt be created in conflict with his duties or interest as a director shall declare at a meeting of the directors of the Islamic bank the fact and the nature, character and extent of the conflict.
Limitation on credit facility for purpose of financing the purchase or holding of shares. [Pt. V, S. 28-29]
(5) The declaration referred to in subsection (4) shall be made at the first meeting of the directors heid--
(a) after he becomes a director of the Islamic bank;
(b) (if already a director) after he commenced to hold office or to possess the property as the case may require.
(6) The secretary of the Islamic bank shall cause to be brought up and read any declaration made under subsection (1) or (4) at the next meeting of the directors alter it is given, and shall record any declaration made under this section in the minutes of the meeting at which it was made or at which it was brought up and read
(7) Any director who acts in contravention of subsection (1) oI (4) shall be guilty of an offence and shall on conviction be liable to a fine not exceeding twenty thousand ringgit or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
(1) Any credit facility granted by any Islamic bank to any person for the purpose of financing the purchase or the "holding of shares shall not exceed such percentage of the market value of the shares at the time the credit facility is granted, as may be directed by the Central Bank in writing.
(2) A credit facility granted under this section to any person shall be accounted for in an account stparate from that kept for any other credit facility
(3) The Central Bank may give direction in writing to any Islamic bank in respect of the following matters, that is to say—
(a) the basis and method for determining the market value of sharos held as security for suchcredit facility;
(b) the withdrawal of funds or shares by the person to whom such credit facility was granted; c) the substitution of other shares for shares hel s security for such credit facility; an
(d) such other matters as may be deemed necessary.
[Pt. V-VI, S. 29-33]
(4) Any Islamic bank which acts in contravention of the provisions of this section or any direction given under this section shall be guilty of an offence under this Act.
Any Islamic bank; if at any time called upon in Poopiance writing by the Central Bank to do so, shall satisfy it com! by the production of such evidence or information as 55528,224, it may require that the bank is not acting in contra- and 29. vention of any of the provisions of sections 24, 25, 26, 27 and 29. PART VA. ins, a0 1307
Part VI — Powers of supervision and control over islamic banks
The Central Bank shall from time to time Investigainvestigate, under conditions of secrecy, the books, banks. accounts and transactions of each Islamic bank anc of any branch, agency or office outside Malaysi opened by an Islamic bank.
The Minister may at any time direct the Central Special Bank to make an investigation, under conditions of investigation secrecy, of the books, accounts and transactions of an of banks. Islamic bank, if he has reason to believe such Islamic bank is carrying on its business in a manner detrimental to the interests of its depositors and other creditors, or has insufficient assets to cover its liabilitie to the public, or is contravening the provisions of thi Act or of the Central Bank of Malaysia Ordinance 61/58. 1958.
(1) Subject to subsection (2), for the purposes of Production an investigation under section 31 or 32, an Islamic booksand accounts and dotumens and shkil gise s ich inoks. documents. mation and facilities as may be required to conduct
(2) Books, accounts and documents shall not be required to be produced at such times and at such places as. shall interfere with the proper conduct of the normal daily business of the bank concerned. ..-- .._.
[Pt. VI, S. 33-34]
(3) Any Islamic bank which fails to allow access to its books, accounts and documents or to give information or facilities in accordance with subsection (1) shall be guilty of an offence and shall on conviction be liable to a fine not exceeding four thousand ringgit for every day during which the default continues. F.M.S. Cap. 45. Banking secrecy. 1c1 33. : ! ... within the meaning of the Penal Code.
(1) Except as provided in sections 31 and 32, nothing in this Act shall authorize the Minister to durect the Central Bank, or shall authorize the Central Bank, to enquire specilically into the atlairs of any individual customer of any Islamic bank and any incidental information relating to the affairs of the indıvıdual customer obtained by the Central Bank in the course of an inspection or investigation made by the Central Bank under the provisions of this Act shall be secret between the Central Bank and that bank.
(2) Nothing in this section shall be deemed to limit any powers conferred upon the High Court or a Judge thereof by the Bankers' Books (Evidence) Act 1949 or to prohibit obedience to an order made under that
(3) Except with the consent of the Central Bank in writing and to the extent specified therein, no officer of any Islamic bank and no person who by reason of his capacity or office has by any means access to the records of that bank, registers or any correspondence or material with regard to the account of any individual customer of that bank shall give, divulge or reveal any information whatsoever regarding the moneys or other relevant particulars of the account of the customer unless—
(a) the customer or his personal representative gives his permission so to do:
(b) the customer is declared bankrupt; or
(c) the information is required to assess the creditworthiness of the customer relating to a bona fide commercial transaction or a prospective commercial transaction.
iirs OI ass s and any airs of the :al Bank in in made by of this Act k and that ned to limit t or a Judge =) Act 1949 = under that tral Bank in n, no officer by reason of access to the rrespondence ny individual or reveal any neys or other the customer representative t; OT ss the creditn to speina IPt. VI, S. 34-35]
(4) The provisions of subsecibn (3) shall not apply to the giving of information to auditors appointed under section 17, officers and employees of the bank who are sus, naoss resident in Malaysia.
(5) Any person who acts in contravention of the provisions of this section shall be guilty of an offence and shall on conviction be liable to a fine not exceeding forty thousand ringgit or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
(1) Every Islamic bank shall send to the Central Action tobe Bank within such period as may be prescribed by notice in writing from time to time by the Central Bank after are agains the last day of each month a statement in the form to interests ol be prescribed by the Central Bank showing particulars of all advances, loans or credit facilities granted bý
(a) any corporation which is deemed to be related to the bank as described in section 6 of the Companies Act 1965;
(b) any corporation or public company reterred to in subsection (4) of section 25; and
(c) any individual in whom and any firm or corporation in which any of its directors is interested, directly or indirectly, as declared under the provisions of section 28, other than advances, loans and credit tacilities particulars of which have already been supplied pursuant to the preceding paragraphs.
(2) If on examination of the particulars supplied by an Islamic bank under subsection (1) it appears to the Central Bank that any such advance, loan or credit facility is being granted to the detriment of the interests of the depositors of that bank, the Central Bank may by order in writing prohibit that bank from granting any further advance, loan or credit facility or impose such restrictions on the grant thereof as the Central Bank thinks fit, and may further direct that bank to secure repayment of any such advance, loan or credit facility within such time and to such extent as may be specified in the order: Act 125.
Banks unable to meet obligations to inform Bank. Action by Contral Bank if bank unable to meet obligations or conducting business to the detriment of depositors. [Pt. VI, S. 35-37]
(3) Any Islamic bank which has been issued with an order by the Central Bank pursuant to this section may appeal in writing to the Minister, who may, as he thinks fit, confirm, vary or revoke the order of the Central Bank.
An Islamic bank which considers that it is likely to become unable to meet its obligations or is about to suspend payment shall forthwith inform the Central Bank of that fact.
(1) Where...
(a) an Islamic bank informs the Central Bank-
(i) that it considers that it is likely to become unable to meet its obligations; or
(ii) that it is about to suspend payment;
(b) an Islamic bank becomes unable to meet its obligations or suspends payment; or
(c) after an investigation is made under section 31 or 32 the Central Bank is of the opinion that an Islamic bank-
(i) is following unsound or improper practices;
(ii) is likely to become unable to meet its obligations or is about to suspend payment;
(iil) has contravened or failed to comply with any provision of this Act;
(iv) has contravened or failed to comply with any condition imposed on its licence; or
(v) is likely to be carrying on its business ir a manner detrimental to the interests of its depositors, the Central Bank, with the concurrence of the Minister, may exercise such one or more powers specified in subsection (2) as it deems to be necessary.
ed with an ection may is he thinks he Central it is likely is about to he Central 1 Banki to become ; Or ayment; to meet its r section 31 pinion that improper to meet its ispend paycomply with comply with licence; or . business in interests of he Minister, specified in - [Pt. VI, S. 37-38]
(2) Subject to subsection (1), the Central Bank may-
(a) issue orders to the bank to take such steps as the Central Bank may consider necessary to rectify the matter and the bank shall carry ut such orders within such time as may b prescribed by the Central Bank
(b) prohibit the bank from extending any further the Central Bank may impose;
(c) remove from office any of its directors or appoint any person as its director;
(d) appoint a person to advise the bank on the proper conduct of its business;
(e) assume control of, and carry on, the business of the bank or appoint some other person to assume control of, and carry on, the business of the bank; or
(f) present a petition to the High Court for the winding up of the bank by the Court.
(3) Where the Central Bank has appointed a person—
(a) to be a director of the bank under paragraph
(c) of subsection (2);
(b) to advise the bank on the proper conduct of its business under paragraph "(d) 'of subsection (2);
(c) to assume control of, and carry on, the business of the bank under paragraph (e) of subsection
(2), the Central Bank may fix the remuneration and expenses to be paid to that person by the bank.
Where the Central Bank has acted under paragraph Effect of
(c) of subsection (2) of section 37 with respect to an removal of office of Islamic bank, the following provisions shall have director or effect— appointment of a
(a) notwithstanding anything contained in the director Companies of a bank and the articles of by the association of the bank, the rights of the mem- Bank. bers or holders of shares to elect directors of Act 125.
[Pt. VI, S. 38-39] Control of Islamic bank by Bank. the bank in place of those who are removed from office by the Central Bank shall cease to be exercisable;
(b) any director removed from office under that paragraph shall cease to hold office, and shall not be entitled to claim any compensation for the loss or termination of office; and
(c) every r'emoval or appointment under that paragraph shall be final and conclusive and shall not be questioned in any Court.
(1) Where the Central Bank has assumed or has appointed another person to assume control of the business of an Islamic bank in pursuance of paragraph
(e) of subsection (2) of section 37, the Central Bank or that person shall, subject to subsection (2), remain in control of the bank and continue to carry on the business of the bank in the name and on behalf of the bank until such time as the Central Bank is satisfied that the reasons for which it assumes control or has appointed another person to assume control have ceased to exist.
(2) Where the Central Bank has assumed control, or has appointed another person to assume control, of the business of an Islamic bank in pursuance of paragraph (e) of subsection (2) of section 37 the High Court may, upon application of the bank, order that the Central Bank shall cease to control the business of the bank as from a date specified in the order if the High Court is satisfied that it is no longer necessary for the protection of the depositors of the bank that the Central Bank should remain in control of the business of the bank.
(3) Where the Central Bank has assumed control, or has appointed another person to assume control, of the business of an Islamic bank in pursuance of paragraph (e) of subsection (2) of section 37, or ceased to control the business of an Islamic bank in pursuance of this section, the Central Bank shall notify that fact in the Gazette.
3 removed 1l cease to ınder that ,and shall isation for that paraand shall led or has rol of the paragraph al Bank or remain in ry on the half of the is satisfied rol or has lave ceased control, or control, of se of para- Figh Court I that the ness of the f the High ary for the the Central ness of the =d control, control, of ce of parar ceased to pursuance ý that fact [Pt. VI, S. 40-42] ISLAMIC' BANKING
(1) Where the Central Bank has assumed control, Islamic or has appointed another person to assume control, of bank under control of the business of an Islamic bank in pursuance of para- Central graph (e) of subsection (2) of section 37, the Islamic co-operate bank shall submit its business to the control of the Bank. with Central Central Bank or to that person and shall provide the Central Bank with such facilities as the Central Bank requires to carry on the business of that bank.
(2) Any Islamic bank which fails to comply with subsection (1) or with any requirement of the Central Bank thereunder shall be guilty of an offence and shall on conviction be liable to a fine not exceeding four thousand ringgit for every day during which the default continues.
Any reference in this Part to an Islamic bank shall Extension be read as including a reference to a subsidiary of an doito Islamic bank.
(1) The Central Bank may, with the approval of Moratorium the Minister, if it considers it to be in the interests of the depositors of an Islamic bank, make an order prohibiting the bank from carrying on banking business or from doing or performing any act or function connected with banking business or any aspect thereof as may be specified in the order.
(2) The Central Bank may, with the approval of the Minister, if it considers it to be in the interests of the depositors, apply to the High Court for an order staying the commencement or continuance of any proceedings by or against the bank in regard to any business of the bank. Such an order shall be valid for a period not exceeding.six months. :(3) So long aș an order under subsection (1) remains in force the licence granted to the bank under this Act shall be suspended. • (4) Where an order has been made under subsection
(1), the: Central Bank shall notify that fact in the
(4) . Ce ara Gazette.
[Pt. VI-VII, S. 43-44] Amendment. 43. (1) Every Islamic bank shall, prior to the making constitution. of any amendment or alteration in the memorandum of association or articles of association or other instrument under which it is incorporated, furnish to the Central Bank particulars in writing of such proposed amendment or alteration for its approval.
(2) Every Islamic bank shall, within three months after the making of any amendment or alteration in the memorandum of association and articles of association or other instrument under which it is incorporated, furnish to the Minister through the Central Bank particulars in writing (verified by a statutory declaration made by a senior officer of the bank) of such amendment or alteration.
(3) Any Islamic bank which fails to comply with the requirements of subsection (1) or (2) shall be guilty of an offence and shall on conviction be liable to a fine not exceeding two thousand ringgit for every day during which the default continues.
(1) Tiap-tiap bank Islam hendaklah, sebelum Pindaan membuat ,apa-apa pindaan atau perubahan dalam memorandum persatuan atau artikel persatuan atau suratcara-suratcara lain yang di bawahnya ia diperbadankan, memberi kepada Bank Negara butir-butir secara bertulis mengenai pindaan atau perubahan yang dicadangkan itu untuk kelulusannya.
(2) Tiap-tiap bank Islam hendaklah, dalam masa tiga bulan selepas dibuat apa-apa pindaan atau perubahan dalam memorandum persatuan dan artikel persatuan atau suratcara-suratcara lain yang di bawahnya ia diperbadankan, memberi kepada Menteri melalui Bank Negara butir-butir secara bertulis (diverifikasikan melalui akuan berkanun yang dibuat oleh seorang pegawai kanan bank itu) mengenai pindaan atau perubahan itu.
Indemniti. [Bah. VI-VII, S. 43-46]
(3) Sesuatu bank Islam yang tidak mematunı kehendak-kehendak subseksyen (1) atau (2) adalah melakukan suatu kesalahan dan apabila disabitkai boleh dikenakan denda tidak lebih daripada dua ribı ringgit bagi tiap-tiap satu hari keingkaran itu berterusan.
Part VII — Miscellaneous
(1) Neither the Government nor the Central Bank nor any officer of either shall be subject to any action, claim or demand by or liability to any person in respect of anything done or omitted to be done in good faith in pursuance or in execution or intended execution, or in connection with the executing or intended execution, of any power conferred upon the Government, Central Bank or the officer by this Act.
(2) For the purposes of this section a Minister and any public officer shall be deemed to be an officer of the. Government; and the. Governor and Deputy Governor of the Central Bank and any director or employee thereof and any person holding any office therein or appointed by the "Central Bank under paragraph (c), (d) or (e) of subsection (2) of section 37 shall be deemed to be an officer of the Central Bank.
: Central Bank to any action, ison in respect • in good faith 1 execution, OI ided execution, nment, Central i Minister and e an officer of and Deputy iy director or ing any office ik: under paraection 37 shall 3ank. IPt. VII, S. 45-47] ISLAMIE BANKING
Where an Islamic bank becontes unable to meet its priority of obligations or suspends payments, the assets of the savings bank in Malaysia shall be available to meet all sight account and savings account labilities of the bank in Malaysia; liabilities. and such liabilities shall have priority over all other liabilities of the bank. 3uD,41as5
(1) Any person who, being a director or manager Penalties on of an Islamic bank-
(a) fails to take all reasonable steps to secure compliance by the bank with the requirements of this Act and of the Central Bank of Malaysia Ordinance 1958 (hereafter in this section 61/58. referred to as "the Ordinance"); or
(b) fails to take all reasonable steps to ensure the correctness of any statement submitted under the provisions of this Act or the Ordinance, shall be guilty of an offence and shall on conviction be eason ae gr ound o batacte tot
(3) A person shall not be sentenced to imprisonment for any offence under subsection (1) unless in the opinion of the Court be committed the offence wilfully. or agent of anty istamic ba, trustee, auditor , employee Offences bi directors,
(a) wilfully makes or causes to be made a false entry in any book of record or in any report, slip, document or statement of the business, affairs, transactions, condition, assets or accounts of the bank; or
(b) wilfully omits to make an entry in any book of record or in any report, slip, document or 'statement of the business, affairs, transactions, condition, assets or accounts of the bank, or wilfully causes any such entry to be omitted: or
•[Pt. VIl, S. 47-49]
(c) wilfully alters, abstracts, conceals or destroys an entry in any book of record or in any report, slip, document or statement of the business, affairs, transactions, condition; assets or accounts of the bank, or wilfully causes any such entry to be altered, abstracted, concealed or destroyed, shall be guilty of an offence and shall on conviction be liable to a fine not exceeding fifty thousand ringgit or to imprisonment for a term not exceeding tve years or to both such fine and imprisonment. Offences by companies, etc., and by servants and agents.
(1) Where any offence against any provision of this Act has been committed by a corporation, firm, society or other body of persons, any person who at the time of the commission of the offence was a director, manager, secretary or other similar officer thereof or was purporting to act in such capacity shall be deemed to be guilty of that oflence unless he proves that the ofience was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised, having regard to the nature of his functions in that capacity and to all the circumstances.
(2) Where any person would be liable under this Act to any punishment or penalty for any act, omission, neglect or default, he shall be liable to the same punishment or penalty for every such act, omission, neglect or detault of any clerk, servant or agent, or of the clerk or servant of the agent, provided that the act, omission, neglect or default was committed by the clerk or servant in the course of his employment, or by the agent when acting on behalf of the person, or by the clerk or servant of the agent when acting in the course of his employment in such circumstances that had the act, omission, neglect or default been committed by the agent his principal would have been liable under this section. Prohibition on receipt of
Any director, officer or employee of an Islamic commission bank, or other persons being persons receiving remuneby staff. ration from the Islamic bank, who asks for or receives,
r destroys ny report, business, assets or auses any concealed iviction be ringgit or 'e years or ion of this 'm, society t the time ector, maeof or was deemed to the offence .vance and t the comexercised, ns in that er this Act omission, ne punishneglect or f the clerk , omission, or servant igent when e clerk or urse of his id the act, ed by the under this an Islamic ng remuneor receives, ommission, ty or thing Ivantage or [Pt. VII, S. 49-53] for that of any of his relatives, from any person other than from that bank, for procuring or endeavouring to lacility from that bank or the purchase or discount o gations by the bank, or for permitting any person to overdraw any account with that bank, shall be guilty of an offence and shall on conviction be liable to a not exceeding twenty thousand ringgit or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
Any Islamic bank which contravenes or fails to General comply with any provision of this Act or regulations penalty. made thereunder for which no penalty is expressly provided shall be guilty of an offence and shall on conviction be liable to a fine not exceeding fitty thousand ringgit.
(1) The Governor of the Central Bank, with the Power of concurrence of the Minister, may compound any offence punishable under this Act by accepting such sum of money as he thinks fit, being not exceeding the amount of the maximum fine to which that person would have been liable if he had been convicted of the offence.
(2) Any moneys paid to the Governor pursuant to the provisions of subsection (1) shall be paid into and form part of the Consolidated Fund. 24. No prosecution in respect of any offence under this Consent of the Public Act shall be instituted without the consent in writing Prosecutor of the Public Prosecutor.
(1) The Central Bank may with the approval of the Regulations. Minister make such regulations as may be required from time to time for carrying into effect the objects of this
(2) Without prejudice to the generality of subsection
(1), regulations may be made-
(a) to provide for control by the Centrai Bank with respect to the acquisition or holding by an Islamic bank of shares of any corporation or the acquisition or development by the bank of any immovable property;
[Pt. VII, S. 53-54] *(771307 ine. 1171307 Bank holidays. Act 102.
(b) to provide for control by the Central Bank with respect to an Islamic bank becoming a partner or proprietor of any firm with unlimited liability;
(c) to provide for control by the Central Bank with respect to the granting of any credit facility to any person for the purpose of financing the acquisition or holding of immovable property shares and contracts in consumer credit and commodity futures;
(d) to provide for the declaration by directors of Islamic banks to the board of directors of their respective Islamic banks of the number and description of any shares in any corporation which are held by or in trust for them or of which they have any right to become the holder (whether on payment or not) or in which they have, directly or indirectly, any beneficial interest, and of the nature of their interest as partner, director, manager or agent in any firm or corporation; and
(e) to provide for the declaration by executive directors, officers and employees of Islamic banks to the respective boards of directors of such Islamic banks or such other person as may be specified in the regulations of the following kinds of interest held by or for any of them or any of their spouses or children:
(i) the number and description of any shares in any corporation which are held by or in trust for any such executive director, officer, employee, spouse or child or of which he has any right to become the holder (whether on payment or not) or in which he has, directly or indirectly, any beneficial interest;
(ii) the nature of any interest. as partner, director, manager or agent in any firm or corporation; and
(iil) all other assets; and peaf ic on amyc bandedared a bank bosiday undier the provisions of section 57 (1) of the Banking Act 1973.
Bank with a partner ited liabi- Bank with facilitrr tarporation lem or of the holder vhich they beneficial interest as 1 any firm executive ›f Islamic irectors of on as may following of them or any shares held by or e director. hild or of ecome the or not) or indirectly, narond. sm time to the Central cessary for [Pt. VII-VII, S. 55-57]
Tiada sesuatu bank Islam boleh menguruskan Hari apa-apa perniagaan dengan awam pada mana-mana hari yang diisytiharkan sebagai hari kelepasan bank di baviah peruntukan-peruntukan seksyen 57 (1) Akta Akta102.
Part VII — Miscellaneous
An Islamic bank which is incorporated under the Apoticarion Oo that iect as wel aball be uprgecit to the p this lct, 4i25. save that where there is any conflict or inconsistency between the provisions of that Act and the provisions of this Act the provisions of this Act shall prevail 50. Ihe Minister may, with or without conditions, Exemption. exempt any Islamic bank from any provision of this Act. Sub,a0130;
Menteri boleh, dengan syarat atau tanpa syarat, Pengemengecualikan mana-mana bank Islam dari manamana peruntukan Akta ini. S05.741307
[Bah. VIIl, S. 57] Pindaan bagi Akta Bank 1973. Akta 102. A kta 276.
Part VIII — Consequential amendments
(1) Section 2 of the Banking Act 1973 is amended- Amanking
(a) by inserting immediately after the definition of Act 1973. "depositor" the following new definition: ' "Islamic bank" means a bank licensed under the Islamic Banking Act 1983;; and Act 276.
(b) by inserting immediately after the words "other licensad bank" in the definitions of "other deposit liabilities", "sight liabilities" and "time liabilities" the words ", any Islamic bank".
(2) Section 9 of the Banking Act 1973 is amended by substituting for paragraph (b) of subsection (1) the following: "(b) no bank shall hereafter be licensed by a name which includes—
(i) any of the words "Central", "Commonwealth", "Federal", "Federation" "Malaysia", "Malaysian", "National", "Reserve", or "State"; .. .::
(il) any of the words "Islamic" or "Muslim" or any other words capable of being construed as indicating that the bank carries on Islamic banking business, either in National Language or in English or il any other language.'
[Pr. VIII, S. 57-59]
(3) Seotion 59 of the Banking Act 1973 is amendea by deleting the word "and" at the end of paragraph (b) of subsection (1), substituting a semicolon for the full stop at the end of paragraph (c) of that subsection and inserting immediately thereafter the word "and" and inserting immediately after that paragraph the "(d) any Islamic bank.". Amendment 58. (1) Section 4 of the Companies Act 1965 is Companies Act 1965. Áct 125. Act 276. amended by inserting immediately after the words "1973" in the definition of "banking corporation" the words "and an Islamic bank as defined in the Islamic
(2) Section 218 of the Companies Act 1965 is amended by substituting for paragraph (j) of subsection
(1) the following:
(j) the company has held a licence under the Act 102. Act 276. Banking Act 1973 or the Islamic Banking Act 1983, and that licence has been revoked or has expired and has not been renewed; Amendment 59. (1) Section 2 of the Central Bank of Malaysia Bank of Malaysia Ordinance 1958. 61/58. Act 276. Ordinance 1958, which in this section is referred to as "the Ordinance", is amended
(a) by inserting immediately before the semicolon at the end of the definition of "bank" the words "or the Islamic Banking Act 1983";
(b) by insenting immediately after the definition of "Governor" the following new definitions: '"investment account liabilities" in relation to an Islamic bank means the deposit liabilities at that bank in respect of funds placed by a depositor with that bank for a Pnc mectnent of sten indet thit santk oi "Islamic bank" means a bank licensed under the Islamic Banking Act 1983;; and !. Act 276.
; amended agraph (b) or the full subsection rd "and" graph the : 1965 is the words ation" the he Islamic t 1965 is subsection under the c Banking en revoked 1 renewed; : Malaysia erred to as semicolon 'the words efinition of ritions: es" in rethe deposit t of funds bank for a reement to it bank on ik licensed 183;; and [Pr. VIli, S. 59]
(c) by inserting immediately after the words "in relation to a bank" in the definition of "other deposit liabilities" the words "other than an Isiamic bank" and by inserting immediately after the semicolon at the end of that definition the following words: "and in relation to an Islamic bank means deposit liabilities at that bank other than savings account, investment account, and time liabilities and deposit liabilities from another bank or the Central Bank;".
(2) Section 37 of the Ordinance is amended—
(a) by inserting immediately after the words "payable to or by banks] in paragraph (b) of subsection (1) the words "other than Islamic banks";
(b) by inserting immediately after the words "each bank" in paragraph (c) of subsection (1) the words" susiuing a semiclon forihe tul stop bt the end of that paragraph;
(c) by inserting immediately after paragraph (c) of subsection (1) the following new paragraph (d): "(d) a reserve to be held by each Islamic bank at the Central Bank comprising such amounts expressed as a percentage of each bank's sight, savings account, investment account, time and other deposit liabilities as may be approved by the Minister on the recommendation of the Board, whether denominated in Malaysian or foreign currency."; and
(d) by inserting immediately after the words "paragraph (c)" in subsection (2) the words "or' (d)"
(3) Section 41 of the Ordinance is amended by substituting for the words "banks or groups of banks" in the first paragraph the words "banks other than Islamic banks or groups of such banks, nor shall it discrininate among Tsamic banks o groups of sial ie
(4) Section 42 of the Ordinance is amended by 19731 the wordiatelyhe tetamie Bands "Act 1983Act 973" the words " Act 276.
[Pt. VIII, S. 59-60]
(5) Section 51 of the Ordinance is amended-
(a) by deleting the words "interest charge" in paragraph (a) of subsection (4); and
(b) by deleting the word "interest" in paragraph
(b) of subsection (4). Amendment 60. Section 2 of the Finance Companies Act 1969 is of Finance Companies amended by substituting for. the words "to carry or Act 1969. banking business in the Federation" in the definition Act6. of "bank" the words "under the Banking Act 1973 or an Islamic bank licensed under the Islamic Banking Act 276. Act 1983" DICETAK OLEL JABATAN PERCETAKAN NEGARA, KUALA LUMPUR DENGIN PERINTAII PADA 1010 MAC 1983 Harga: $1.50
(1) Seksyen 4 Akta Syarikat 1965 adalah dipinda deng an9737 dalama raseil s saling cprporation pka- 9/k pet-1965. kataan-perkataan "and an Islamic bank as defined in Akta 125. the Islamic Banking Act 1983'.
(2) Seksyen 218 Akta Syarikat 1965 adalah dipinda menggantikan paragraf ) subseksyen (1) dengan yang berikut:
(j) the company has held a licence under the Act 102. Act 276. Banking Act 1973 or the Islamic Banking Act 1983, and that licence has been revoked or has expired and has not been renewed; 5958, y Sc sebul Ordinan" Balam sNksyen in, adayaia Brndan dipinda—
(a) dengan memasukkan sebelum sahaja koma ber- 1958. titik pada penghujung takrif "bank" perkataan- 61/58. perkataan "or the Islamic Banking Act 1983"; Act 276.
(b) derovenoremakril baru selepas sauaia takrit 'Governoı • "investment account liabilities" in relation to an Islamic bank means the deposit liabilities at that bank in respect of funds placed by a depositor with that bank for a fixed period of time under an agreement to share the profits or losses of that bank on the investment of such funds; "Islamic bank" means a bank licensed under the Islamic Banking Act 1983;; dan Act 276.
(c) dengan memasukkan selepas sahaja perkataanperkataan "in relation to a bank" dalam takrif 'other deposit liabilities" perkataan-perkataar "other thân an Islamic bank" dan dengan memasukkan selepas sahaja koma bertitik pada Derikut ung takrif itu perkataan-perkataan yang "and in relation to an Islamic bank means deposit liabilities at that bank other than. savings account, investment account, sight and time liabilities and deposit liabilities from another bank or the Central Bank;".
[Bah. VIII, S. 59] Act 276. !.:
(2) Seksyen 37 Ordinan adalah dipinda—
(a) dengan in maaykkae soeors ba banksr dalam perkataan paragrat (b) subseksyen (1) perkataan-perkataaı 'other than Islamic banks () denkalane rcach ban s depas alara par kalar. , other than an Islamid barkat dan menggantikan noktah pada penghujung paragraf dengan koma ber-
(c) dengan memasukkan selepas sahaja paragraf (c) subseksyen (1) paragraf baru (d) yang berikut: "(d) a reserve to be held by each Islamic bank at the Central Bank comprising such amounts expressed as a percentage of each bank's sight, savings account, Investment account, time and other deposit liabilities as may be approved by the Minister on the recommendation of the Board, whether denominated in Malaysian or foreign currency."; dan
(d) dengan memasukkan selepas sahaja perkataanperkataan "paragraph (c)" dalam subseksyen
(2) perkataan-perkataan "or (d)".
(3) Seksyen 41 Ordinan adalah dipinda dengan menggantıkan perkataan-perkataan , "banks or groups of banks" dalam paragraf pertama dengan perkataanperkataan "banks other than Islamic banks or groups of such banks, nor shall it discriminate among Islamic banks or groups of Islamic banks,"
(4) Seksyen 42 Ordinan adalah dipinda dengan memasukkan selepas sahaja perkataan-perkataan "Banking Act, 1973" perkataan-perkataan "or the Islamic Banking Act 1983"
(5) Seksyen 51 Ordinan adalah dipinda—
(a) derest chargeotonam pkatgrat (a) atascksyen
(4); dan
(b) dengan memotong perkataan "interest" dalam paragraf (b) subseksyen (4).
1dathaja perkataanbanks" dalam ataan-perkataan haja perkataan- )aragrat (c) subother than antikan noktah gan koma beraja paragraf (c) 'yang berikut: h Isiamic bank mprising such percentage of iccount, investother deposit roved by the idation of the ted in Malayaja perkataanm subseksyen dengan mengi groups of n perkataaniks or groups mong Islamic inda dengan an-perkataan lan "or the [Bah. VIII, S. 60]
Seksyen 2 Akta Syarikat Kewangan 1969 adalah Pindaan dipinda dengan menggantikan perkataan-perkataan sekitlknm dalam akit bänkn denk perataan- B sekutuan" Beam yan "dibeasera df baaaank k2a Baak Sesam u bazk. - kataan "in- 'subseksyen 'rest" dalam DICETAK OUEN AN FEN NIAG FASA IOES SA KUAEA LUMPUR Harga: $1.50
Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).
