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Questions and Answers
What is the power of the Reserve Bank according to Section 36A?
What is the power of the Reserve Bank according to Section 36A?
- To appoint additional directors
- To remove managerial and other persons from office
- To supersede the Board of Directors
- To give directions (correct)
What is the purpose of Section 20A?
What is the purpose of Section 20A?
- Restrictions on power to remit debts (correct)
- Licensing of banking companies
- Restrictions on loans and advances
- Maintenance of a percentage of assets
What is the provision for certain banking companies according to Section 36A?
What is the provision for certain banking companies according to Section 36A?
- Certain provisions of the Act not to apply (correct)
- Production of documents of confidential nature
- Part IIA to override other laws
- Punishments for certain activities in relation to banking companies
What is the responsibility of the Reserve Bank according to Section 21?
What is the responsibility of the Reserve Bank according to Section 21?
What is the purpose of Section 27?
What is the purpose of Section 27?
What is the consequence for certain activities in relation to banking companies according to Section 36AD?
What is the consequence for certain activities in relation to banking companies according to Section 36AD?
What is the purpose of Section 23?
What is the purpose of Section 23?
What is the power of the Reserve Bank according to Section 36ACA?
What is the power of the Reserve Bank according to Section 36ACA?
According to the provisions of section 10B, who is exempt from holding qualification shares in a banking company?
According to the provisions of section 10B, who is exempt from holding qualification shares in a banking company?
Under what circumstances can the Reserve Bank appoint a director to a banking company?
Under what circumstances can the Reserve Bank appoint a director to a banking company?
What is the effect of an appointment or removal of a director, chairman, or managing director made under sections 10A, 10B, or 10BB?
What is the effect of an appointment or removal of a director, chairman, or managing director made under sections 10A, 10B, or 10BB?
What is the purpose of section 10B in the context of banking laws?
What is the purpose of section 10B in the context of banking laws?
Which of the following is NOT a consequence of an appointment or removal of a director, chairman, or managing director made under sections 10A, 10B, or 10BB?
Which of the following is NOT a consequence of an appointment or removal of a director, chairman, or managing director made under sections 10A, 10B, or 10BB?
Who is responsible for appointing a chairman of the Board of directors on a whole-time basis or a managing director to a banking company?
Who is responsible for appointing a chairman of the Board of directors on a whole-time basis or a managing director to a banking company?
What is the relationship between sections 10A, 10B, and 10BB in the context of banking laws?
What is the relationship between sections 10A, 10B, and 10BB in the context of banking laws?
What is the significance of section 10C in the context of banking laws?
What is the significance of section 10C in the context of banking laws?
What happens to any provision contained in the memorandum, articles, agreement or resolution that is repugnant to the provisions of the Banking Companies (Amendment) Act, 1959?
What happens to any provision contained in the memorandum, articles, agreement or resolution that is repugnant to the provisions of the Banking Companies (Amendment) Act, 1959?
What business can a banking company engage in, in addition to the business of banking?
What business can a banking company engage in, in addition to the business of banking?
What can a banking company do with securities that form part of the security for any loans or advances?
What can a banking company do with securities that form part of the security for any loans or advances?
Study Notes
Section 10B Provisions
- The provisions of Section 10B apply to the Chairman of the Board of Directors appointed on a whole-time basis or a Managing Director appointed by the Reserve Bank.
- The Chairman and certain directors are not required to hold qualification shares in the banking company.
Section 10D
- The provisions of Sections 10A, 10B, and 10BB override all other laws, contracts, etc.
- Any appointment or removal of a director, Chairman, or Managing Director in pursuance of Section 10A or Section 10B shall have effect, notwithstanding anything contained in any law or contract.
Business of Banking Companies
- Banking companies can engage in various forms of business in addition to banking, including:
- Borrowing, raising, or taking up money
- Lending or advancing money
- Drawing, making, accepting, discounting, buying, selling, collecting, and dealing in bills of exchange, hoondees, promissory notes, etc.
- Buying, selling, and dealing in bullion and specie
- Buying and selling of foreign exchange
- Acquiring, holding, issuing on commission, underwriting, and dealing in stock, funds, shares, debentures, etc.
- Acting as agents for Governments, local authorities, or other persons
- Contracting for public and private loans and negotiating and issuing the same
- Effecting, insuring, guaranteeing, underwriting, participating in managing and carrying out of any issue of State, municipal, or other loans
- Carrying on and transacting every kind of guarantee and indemnity business
- Managing, selling, and realising any property that may come into possession of the company
- Acquiring and holding and generally dealing with any property or right, title, or interest in any property
- Undertaking and executing trusts
- Undertaking the administration of estates as executor, trustee, or otherwise
- Establishing and supporting or aiding in the establishment and support of associations, institutions, funds, trusts, and conveniences for employees or ex-employees
Other Provisions
- Part IIA: Control over Management
- Part IIAB: Supersession of Board of Directors of Banking Company
- Part IIB: Prohibition of Certain Activities in Relation to Banking Companies
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Description
This quiz covers the provisions of Sections 10B and 10D of the Banking Regulation Act, including the role of the Chairman and Managing Director, and the override of other laws and contracts.
