(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.
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).
