PRADESHIYA SANWARDANA BANK act

Arrangement of Sections

1. Short title.

2. Establishment of Sri Lanka Pradeshiya Sanwardana Bank.

3. Seal of the Bank.

4. Head office of the Bank.

5. Branches of the Bank.

PART I

POWERS AND OBJECTS OF THE BANK

6. Objects of the Bank.

7. Priorities.

8. Powers of the Bank.

PART II

MANAGEMENT OF THE BANK

9. Board of Directors.

10. Constitution of the Board.

11. Members of the Board.

12. Chairman of the Board.

13. Executive Directors.

14. Remuneration of Directors.

15. Director to disclose interest in contract proposed to be made by the Bank.

16. Meetings of the Board, quorum and regulation of procedure.

17. Act of the Board not to be invalid by reason of any vacancy.

18. Delegation of powers and duties of the Board.

19. Secretary to the Board.

PART III

FINANCE

20. Authorised capital and contributions to the initial capital.

21. Transfer of the shares by shareholders of the Bank.

22. General Reserve fund.

23. Special Reserve Fund.

24. Payment of dividends.

25. Security on which loans may be granted by the Bank.

PART IV

STAFF

26. General Manager.

27. Deputy General Managers.

28. Guidelines.

29. Regional General Managers.

30. Staff of the Bank.

PART V

AUDIT OF ACCOUNTS OF THE BANK

31. Financial year of the Bank.

32. Board to keep proper books of accounts.

33. Audit.

34. Annual General Meeting.

35. Documents to be transmitted to the Minister to be laid before Parliament.

36. Certain written laws not to apply to the Bank.

37. Indemnity of Directors.

38. Declaration of secrecy.

39. Rules.

40. Bank to be a "lending institution”, "Bank” and "licensed specialized bank”.

41. Credit guarantee coverage from the Central Bank.

PART VI

VESTING OF BUSINESS OF DEVELOPMENT BANKS

42. Vesting of business of Regional Development Banks in a Bank.

43. Effect of a Vesting Order.

44. Audit of accounts and valuation of vested business.

45. Repeal and saving provision.

46. Payment of compensation.

47. Sinhala text to prevail in case of inconsistency.

48. Interpretation.

SCHEDULE

41 of 2008,

30 of 2011.

AN ACT to provide for the establishment of the Pradeshiya Sanwardana Bank and for the absorption of the assets, liabilities, contracts, employees of the development banks established under the Regional Development Banks Act, No. 6 of 1997 and to provide for matters connected therewith or incidental thereto.

[Date of Commencement: 1st December, 2008]

1. Short title.

This Act may be cited as the Pradeshiya Sanwardana Bank Act.

2. Establishment of Sri Lanka Pradeshiya Sanwardana Bank.

(1) There shall be established a Bank to be called the Pradeshiya Sanwardana Bank (hereinafter referred to as the "Bank”).

(2) The Bank shall by the name assigned to it by subsection (1) be a body corporate and shall have perpetual succession and a common seal and may sue and be sued in such name.

3. Seal of the Bank.

(1) The Seal of the Bank shall be in the custody of the Chairman or any other officer authorised by him.

(2) The Seal of the Bank shall be approved by the Board and may be altered in such manner as may be determined by the Board.

(3) The Seal of the Bank shall not be affixed to any instrument except in the presence of two directors of the Board of Directors or one Director of the Board of Directors and the Chief Executive Officer (who shall be designated as the General Manager of the Bank), both of whom shall sign the instrument in token of their presence.

4. Head office of the Bank.

The head office of the Bank may be established in any location in Sri Lanka, outside the Administrative District of Colombo, as may be determined by the Board.

[S 4 subs by s 2 of Act 30 of 2011.]

5. Branches of the Bank.

The Bank may establish and maintain branches in Sri Lanka, at such places, as the Board of Directors of the Bank considers necessary so to do, including any location where Development Banks offices have presently been established in terms of Regional Development Banks Act, No. 6 of 1997 and which are in terms of section 42 of this Act, vested with the Bank.

PART I

POWERS AND OBJECTS OF THE BANK

6. Objects of the Bank.

The objects of the Bank shall be to facilitate the overall regional economic development of Sri Lanka by promoting the development of agriculture, industry, trade, commerce, livestock, fisheries activities and empowerment of women, mainly by granting financial assistance to Micro Finance Institutions and Small and Medium Enterprises.

7. Priorities.

The Minister may by Order published in the Gazette specify such percentage of lending required to be allocated to any priority sector, taking into consideration priorities of the Government in relation to its development activities.

8. Powers of the Bank.

The Bank may, subject to the provisions of this Act, and without prejudice to any powers conferred on it by or under any law, engage in all or any activity permitted to be carried on by a Licensed Specialized Bank in terms of the Banking Act, No. 30 of 1988.

PART II

MANAGEMENT OF THE BANK

9. Board of Directors.

(1) The management and administration of the affairs and business of the Bank shall vest in a Board of Directors (hereinafter referred to as "the Board”).

(2) The Board may exercise, all or any of the powers of the Bank under this Act or any other law relating to the objects of the Bank and do all acts and things which it is authorised to do and perform under this Act or such other law, as the case may be.

(3) The Board shall in the exercise of its powers, act on the basis of sound business principles and have due regard to the economic development programmes of the Government.

10. Constitution of the Board.

The Board shall consist of not less than seven and not more than eleven directors, nominated or elected as the case may be, in the manner set out in section 11 of this Act.

11. Members of the Board.

(1) The following shall be ex-officio members of the Board—

(a) a Deputy Secretary to the Treasury nominated by the Secretary to the Treasury;

(b) a Deputy General Manager of the Bank of Ceylon nominated by the Board of Directors of the Bank of Ceylon;

(c) a Deputy General Manager of the People's Bank nominated by the Board of Directors of the People's Bank;

(d) a Deputy General Manager of the National Savings Bank nominated by the Board of Directors of the National Savings Bank.

(2) There shall be not less than three and not more than seven nominated Directors (hereinafter referred to as "nominated directors”), who shall be appointed by the Minister in consultation with the Secretary to the Treasury from among persons possessing academic or professional qualifications or experience in the fields of Banking, Accounts, Finance, Law, Management, Human Resource Management, Co-operative activities, Rural Development or Empowerment of Women. The Minister shall when making such nomination endeavour as far as possible to ensure adequate female representation on the Board.

(3) A nominated Director shall hold office for a term of three years.

(4) A nominated Director may be reappointed for a second term of three years, provided that the Director has not been removed from office under subsection (5) of this section.

(5) The Minister may remove a nominated Director from office, for reasons to be assigned for such removal.

(6) A nominated Director may resign from his office by a letter in that behalf addressed to the Minister.

(7) Where a nominated Director is temporarily unable to perform the duties of his office by reason of ill-health or other infirmity or absence from Sri Lanka, the Minister may nominate another person to act in his place.

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