Section 7: Grant or refusal to grant banking licence

7. Grant or refusal to grant banking licence (1) The central bank may, following its determination of an application under section 5, grant or refuse the application. (2) No banking licence shall be granted by the central bank unless it is satisfied— (a) that the applicant has— (i) demonstrated that the directors or senior officers of the applicant have technical knowledge, experience in banking B3 – 11 [Issue 9] Banking Act or finance and are fit and proper persons to carry on the proposed banking business; (ii) sufficient financial resources and an adequate capital structure to serve as a continuing source of financial support for the proposed bank; (iii) demonstrated the soundness and feasibility of the applicant’s plans for the future conduct and development of the business of the proposed bank, including accounting and internal control systems; (iv) the ability and willingness to comply with such other conditions as the central bank may impose under the banking laws; (b) as to the history and character of the business and management of the applicant; (c) as to the convenience and needs of the community or market to be served; (d) as to the fitness and suitability of the applicant’s shareholders, particularly shareholders holding a significant interest; and (e) where the applicant forms part of a group predominantly engaged in banking activities, that the corporate structure of the group or its geographical location or the banking law in the home country of the group does not hinder effective consolidated supervision. (3) Where the applicant is the branch of a bank incorporated abroad and is making an application either singly or in joint venture with a bank incorporated in Mauritius, the central bank shall satisfy itself that the bank incorporated abroad is a reputable international bank, having operated as a bank in the jurisdiction of its head office for at least 5 years, and is subject to consolidated supervision by competent foreign regulatory authorities. (4) The central bank may refuse to grant a banking licence where the applicant intends to operate under a name which— (a) so resembles that of an existing financial institution in Mauritius or elsewhere as to be likely to mislead the public; (b) is calculated to suggest falsely a connection with a person or authority outside Mauritius; (c) is calculated to suggest falsely a special status in relation to the Government of Mauritius, any foreign Government or any public body in or outside Mauritius, or that the applicant enjoys the official support or patronage thereof. (5) Where the central bank grants a banking licence, it shall notify the applicant in writing within 7 days of its decision, and shall, upon payment of the annual licence fee, issue a banking licence to the applicant. [Issue 9] B3 – 12 Revised Laws of Mauritius (6) A banking licence granted under subsection (5)— (a) shall specify the name of the licensee; and (b) shall be subject to such conditions as the central bank may impose. (7) Subject to section 50 (1), no bank shall carry on banking business in any branch, office or place of business other than its principal place of business, unless the bank obtains the prior approval of the central bank. (7A) No bank shall contract the services of an entity to provide its services on its behalf or enter into an agency agreement for that purpose, without— (a) the prior written approval of the central bank; and (b) payment of such appropriate non-refundable processing fe impose. (7) Subject to section 50 (1), no bank shall carry on banking business in any branch, office or place of business other than its principal place of business, unless the bank obtains the prior approval of the central bank. (7A) No bank shall contract the services of an entity to provide its services on its behalf or enter into an agency agreement for that purpose, without— (a) the prior written approval of the central bank; and (b) payment of such appropriate non-refundable processing fee and annual licence fee as may be prescribed by the central bank, with the approval of the Minister. (7B) An approval under subsection (7A) (a) may be granted subject to such terms and conditions as the central bank may impose. (7C) Sections 10 and 11 shall apply to an approval granted under subsection (7A) (a). (7D) A bank which has been granted a banking licence to carry on exclusively private banking business by the central bank may be exempted from such provisions of the Act as the central bank may determine and be subject to such terms and conditions and guidelines as the central bank may determine. (8) No bank shall open or keep open a new place of business or close or keep closed an existing place of business, or change the location of its business, without the approval of the central bank. (9) No bank shall be engaged in any business other than the business specified in its banking licence. (10) A banking licence shall not de facto or de jure be transferable without the prior approval of the central bank. [S. 7 amended by s. 2 (a) of Act 14 of 2005 w.e.f. 10 November 2004; s. 2 (a) of Act 15 of 2006 w.e.f. 7 August 2006; s. 2 (d) of Act 18 of 2008 w.e.f. 19 July 2008; s. 3 (c) of Act 27 of 2013 w.e.f. 21 December 2013; s. 4 (c) of Act 9 of 2015 w.e.f. 14 May 2015; s. 3 (d) of Act 18 of 2016 w.e.f. 7 September 2016.]