Maldives Application Guidelines For Banking and Financial Institution Licences 2009

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APPLICATIONGUIDELINES for BANKING&FINANCIALINSTITUTIONLICENCES

MALDIVESMONETARYAUTHORITY FINANCIALSECTORDIVISION
2009

MaldivesMonetaryAuthority
BankLicensingGuidelines
TableofContents
PREFACE.............................................................................................................................................1 I. INTRODUCTION........................................................................................................................1 II. APPLICATIONPROCESS.........................................................................................................2
A. PresubmissionintroductionmeetingwithMMA.......................................................................2 B. Preparationandsubmissionofapplication..................................................................................2 C. Statementofintentandjustifyingrationalefornewbank......................................................3 D. Applicationfees......................................................................................................................................3 E. Timelimit.................................................................................................................................................3 F. Annuallicencefee..................................................................................................................................3
III. EVALUATIONPROCESS..........................................................................................................4
A. Startswhen"complete"applicationreceived..............................................................................4 B. Definitionof"complete"application...............................................................................................4 i. Validityofdocuments.........................................................................................................................4 ii. Financialstrengthandhistoryofshareholders......................................................................5 iii. Financialconditionandqualificationsofdirectorsandexecutiveofficers................5 . iv. Informationoninitialcapitalization............................................................................................6 . v. Detailedbusinessplanincludingassumptions........................................................................6 C. TimelineforMMAevaluationanddecision...................................................................................7 D. Primarydecisioncriteria....................................................................................................................7 i. Capital........................................................................................................................................................7 ii. Management............................................................................................................................................8 iii. Businessplan..........................................................................................................................................8 E. Additionalconsiderations...................................................................................................................9 i. Publicneed..............................................................................................................................................9 . ii. Contribution/benefitstoeconomy.............................................................................................9 iii. Competitiveimpact...........................................................................................................................10 iv. Introductionofnew/innovativefinancialproducts/services.......................................10 v. Foreignvs.localownership...........................................................................................................10 vi. Qualityofhomecountrysupervision........................................................................................10 vii. Relationshiptoparentcompany,affiliates,relatedentities...........................................11 viii. Financialcondition/performanceofglobaloperations....................................................11 ix. Branchvs.subsidiary.......................................................................................................................11 x. Comments/advisoriesofotherregulatoryagencies........................................................11 xi. Approvalofhomecountryregulator........................................................................................12 . xii. Goodfaith..............................................................................................................................................12
IV. DECISION..................................................................................................................................12
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A. Preliminaryapproval.........................................................................................................................12 B. Finalapprovalandconditions.........................................................................................................13 C. Commencingoperations....................................................................................................................14
V. REVOCATION,SUSPENSION,AMENDMENTS................................................................14 .
A. Justifyingcircumstances....................................................................................................................14 B. Effect/consequences.........................................................................................................................15
VI. APPEALS...................................................................................................................................15 . ANNEXIApplicationForm......................................................................................................16 ANNEXIIPersonalFinancialStatementFormat.............................................................38 ANNEXIIIFITandPROPERCriteria.....................................................................................44 ANNEXIVBusinessPlanFormat...........................................................................................47 ANNEXVCurrentMonetaryandPrudentialRequirements.......................................54 . ANNEXVIScoringEvaluationWorksheet..........................................................................56
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Preface
These Guidelines have been developed to assist prospective applicants to understand to requirementsforobtainingalicencetooperateabankorfinancialinstitutionintheMaldives. ByreadingandfollowingtheseGuidelines,applicantswillbebetterabletoprepareandsubmit anapplicationintheproperformandcontent,thussavingtimeandexpeditingtheevaluation process.Applicantsareremindedthatalldecisionregardinganapplicationwillbebasedsolely on the merits of the application evaluated against the criteria stated in law and further describedintheseguidelines. Throughout these Guidelines, reference is made to banks; however, these Guidelines apply equallytootherformsoffinancialinstitutionsbecausethefundamentallicensingcriteriaforall institutions are minimum capital, acceptable managers and a realistic, viable business plan. Therefore, wherever the word bank is used, the reader can substitute finance company, leasing company, housing finance company, or insurance company. Where there are differences such as for initial capital requirements or applications fees or annual licence fees, theMMAwillprovidetheseinAppropriateAppendices[orSupplements]totheseGuidelines.
I.
Introduction
One of the primary purposes of the Maldives Monetary Authority (MMA) is to supervise and regulate banking activities so as to promote a sound financial system. The MMA does this, initially,throughtheprocessoflicensingbankinginstitutions.Whendecidingwhethertogrant banking licence, the MMA considers many factors in order to answer the question Will the proposednew(ormerged)bankbegoodfortheMaldives?Theanswertothisquestionisnot simply whether the new or merged bank will provide greater access to credit and financial services, or provide more innovative products or more competition, or bring additional investment into the country. The reputation and integrity of the Maldivian banking system is, withoutdoubt,moreimportantthananysingleorshorttermbenefitsthatmaybegainedfrom anewormergedbank,regardlesshowwellcapitalizedorinnovativeitis.Therefore,firstand foremost,theMMAmustbeconvincedthatthenewormergedbankwillbenefitthelongterm economichealthandinternationalfinancialreputationoftheMaldives. MMA has been given statutory authority to license, regulate and supervise banks and other financialinstitutionsundertheMaldivesMonetaryAuthorityAct(1981)andregulationsissued
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thereunder.Theseguidelineshavebeenpreparedtoassistpotentialinvestors,promoters,and applicants in preparing and submitting an application for a licence to undertake banking businessintheMaldives.
II.
ApplicationProcess
A. PresubmissionintroductionmeetingwithMMA
ProspectiveapplicantsshouldrequestanappointmenttomeetwithofficersoftheSupervision Division of the MMA before preparing and submitting an application. The purpose of this meetingisforapplicanttoexplaintheirproposalanddiscusstheirplans,toaskquestionsandto clarify any items about the information required in the application forms and supporting documents.Duringthemeeting,theMMAmayalsoaskquestionsandwillexplainthelicensing requirements and identify issues which may have a significant bearing on the proposed application.
AlicencetoconductbankingactivitiesintheMaldivesmayonlybeobtainedbyacompanyoran existing financial institution; individuals are not allowed to obtain a licence in their personal capacity. Therefore, unless the prospective applicant is an existing financial institution or company,theinvestorsfirstmustformaseparatecompanyandthensubmitanapplicationto the MMA, under the name of the newly formed company. In order to form a company in Maldives,investorsmustregisterwiththeRegistrarofCompanies,underMinistryofEconomic Development. An application must be submitted in writing, and must include all supporting documentation requestedintheApplicationforlicencetoconductbankingactivitiesintheMaldives(referto ANNEX I of these guidelines). The application form and all supporting documents that are submittedwiththeapplicationmustbesignedbythemembersoftheBoardofDirectorsofthe applicant, or by their legally authorised representative or agent. The completed application forms and all supporting documents should be delivered either personally or by registered/certified/courierto: TheExecutiveDirector FinancialSectorDivision MaldivesMonetaryAuthority 5thFloor,MajeedheeBuilding BoduthakurufaanuMagu,Male RepublicofMaldives
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B.
Preparationandsubmissionofapplication
Every application for a new licence, and also for merger of existing banks, must include a statementofintentandjustifyingrationaleforthenewormergedbank.Thisstatementshould clearly and concisely explain why the new bank is needed and for what purpose it is being formedsoastoreasonablyjustifythegrantingofalicence.
C.
Statementofintentandjustifyingrationalefornewbank
D.
Applicationfees
All applications must be accompanied by an application fee of Rf 150,000 payable to the "MaldivesMonetaryAuthority.ThefeeisnonrefundableandistobepaidtotheMMAwhen submitting the application form. An application will not be considered received or evaluated untiltheMMAhasreceivedcollectedfundsfortherequiredapplicationfeeandhasreceivedall supporting information. Failure to submit the required fee and full information will delay processingandwillresultinimmediaterejectionandreturnoftheapplication. Funds from this fee are used to defray the normal and usual expenses incurred by MMA in evaluating an application. In the event that evaluation of an application is likely to involve expensesthatwillmateriallyexceedtheRf150,000theMMA,atitsdiscretion,maynotifythe applicant of such extraordinary costs and require the applicant to pay an additional fee as determinedbytheMMA.
The MMA will not begin formal consideration of an application until the required fee and all supportingdocumentationhavebeensubmitted.Therefore,applicantsforalicenceshouldact expeditiously to complete their filings and to provide the MMA promptly with all required information.Ifapplicantshavenotsubmitteda"complete"applicationwithinsixmonthsfrom theinitialdateofsubmissionofdocuments,the MMAwilldeemtheapplicationnullandvoid, andthefilingfeewillbeforfeited.
E.
Timelimit
Each bank is required to pay to the MMA an annual licence fee based on average total assets. ForbankswithaveragetotalassetslessthanRf100millionfortheprecedingyear,thefeeisRf 10,000;and,forbankswithaveragetotalassetsofRf100millionormore,thefeeisRf20,000. ThefeeispayableinfullbytheendofJanuaryofeachyear.Inthefuture,theMMAmayrevise themethodology forcalculatingthe annual feeto alignit moreequitablytothesizeofabank andthelevelofsupervisoryresourcesrequired.
F.
Annuallicencefee
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III. EvaluationProcess
When an application is first submitted, the MMA will make a cursory review of application documentstodeterminewhetheracomplete"applicationhasbeenreceived.Iftheapplication form is incomplete, or if responses are not adequately detailed, or if proper supporting documentation is lacking, the MMA will not begin formal review and evaluation of the applicationbutwillreverttotheapplicantsforthemissing,incompleteorinadequatelydetailed information. Only when MMA receives all required information, properly detailed and supported, will MMA begin processing the application. Therefore, it is incumbent upon the applicanttoensuresubmitacompleteandproperlydocumentedapplicationattheoutset.
A.
Startswhen"complete"applicationreceived
Inorderfor MMAtoconsideran application"complete",theofficial application formtogether with all required supporting documentation must be submitted as a package. Supporting documents must be in sufficient detail to verify the quality and veracity of the information contained therein. Where appropriate, certified copies and audited statements should be provided.Submissionofpartialorincompleteinformationwillonlyservetodelaytheprocess. Therefore, it is incumbent on the applicants to take care in compiling and submitting an application. Theinformationlistedbelowcomprisetheminimuminformationnecessaryforanapplication to be regarded as "complete". The MMA may request additional information if circumstances warrant. i. Validityofdocuments
B.
Definitionof"complete"application
Documentsrequiredtobesubmittedwithanapplicationmustbevalid.Tobeconsidervalid,a document, or copy thereof, must be of such nature that a reasonable person would conclude that the document is genuine and authentic and would rely on the information contained therein as true and correct. If the MMA deems necessary, it will take actions as it considers reasonableandnecessarytoverifythevalidityofdocuments,theinformationcontainedinthe documents,andthereliabilityofthepersonorfirmsubmittingorattestingtothevalidityofthe document or information. Documents that are in foreign languages must be accompanied by translationsinEnglish,andtheMMAwillrelyontheEnglishtranslationsastheofficialversions.
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ii.
Financialstrengthandhistoryofshareholders
TheMMAmustbesatisfiedthatallpersonswhoareproposedasmajorshareholdersinthenew ormergedbankhavesufficientfinancialresourcestoprovidetheinitialcapitalforthebankand toprovidesupportinthefutureshouldtheneedarise.Therefore,detailedfinancialstatements mustbesubmittedforeachnaturalpersonandlegalentitythatwillholdasignificantinterest1 in the proposed bank. Personal financial statements for all natural persons submitted for this purposeshouldbecurrent,i.e.lessthanninety(90)daysold,andcertified(refertotheformat in ANNEX II of these guidelines). Audited Financial statements for corporate shareholders shouldbesubmittedatleastforthepastthree(3)years. Demonstrating financial strength, persons proposed as major shareholders must have a reputationofintegrityandprobity.Questionsregardingtheintegrityofmajorshareholdersofa bankcanreflectunfavorablyonthebankitself,ontheprudenceandobjectivityofthelicensing authorities,andpotentiallyontheinternationalreputationoftheMaldivianfinancialindustry. Therefore, the MMA will insist that major shareholders be persons of good repute and demonstratedintegrity. iii. Financialconditionandqualificationsofdirectorsandexecutiveofficers
Inadditiontothesuitabilityofmajorshareholders,applicantsforanewbankmustshowtothe satisfaction of the MMA that all persons who will be members of the board of directors and executive officers of the proposed bank are appropriately qualified and of sound financial condition. The experience and suitability of the members of the board of directors, executive officers and significant shareholders must/should be "fit & proper" persons as measured againstdefined,objectivecriteria(FitandPropercriteriaisattachedasAnnexIII).Therefore, theMMAwillrequiresubmissionofthefollowing 1. Curriculum vitae: detailed CV's must be submitted for all persons proposed as directors or executiveofficers;CV'smustincludethefollowinginformation; 1
Qualificationsdetailedlistingoftheprofessionalandacademicqualifications. Experience details of employment history and professional experience for preceding10years;informationshouldcontactdetailstoenableverification. Nameandaddressofcurrentandpreviousemployers(includecontactdetails). Natureortypeofbusiness. Titleandduties/responsibilities.
A significant interest means owning or controlling, directly or indirectly, 10% or more of the outstanding equity or any class of shares with voting rights of a financial institution.
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Dateemployed,anddateandreasonforleaving Complete details regarding positions held in financial institutions, e.g. area/s of responsibility,lendingauthority,assetssupervised,etc. 2.Role,Responsibilities,andReportinginProposedBankDiscusstherole/seachpersonwill haveinorganizingandmanagingtheaffairsoftheproposedinstitution.Indicatetowhomthe person will report and/or from whom he will receive directions or instructions. If the person willbeanexecutiveofficer,describethespecificdutiesandresponsibilitiesfortheposition(s) tobeheld.Ifthepersonwillbeadirectorandwillalsohaveexecutiveofficerresponsibilities withintheproposedinstitution,indicatethenatureandextentofsuchresponsibilities. 3. Personal Financial Statement financial information must be submitted for all natural persons who will be directors or executive officers of the proposed institution. Format for preparing personal financial statement is prescribed in these guidelines in ANNEX II although applicants may submit personal financial statements in other formats provided that sufficient detailsareincludedtoenableMMAtothoroughlyassessaperson'sfinancialcondition. 4. Interlocking Directorship No person will be allowed to be a director of an institution if he/she is also a director of any nonaffiliated financial institution. For purposes herein, the term "financial institution" includes insurance companies, mortgage companies, securities firms,andanyotherfirmthatprovidesfinancialservicesinRepublicofMaldives.Evidencethat thislimitationhasbeencircumventedwillbegroundsfordenial. iv. Informationoninitialcapitalization
An application must provide sufficient detail for MMA to ascertain the source, legitimacy and amount of initial capitalizing funds for the new bank, and that the initial capital amount will satisfytheminimumcapitalrequirementsetforthinMMAActandregulations. v. Detailedbusinessplanincludingassumptions
Applicants must submit a business plan that demonstrates a reasonable likelihood of viability andsuccessbasedonrealisticassumptionsandastrategyconsistentfortheproposedmarket area of the bank. The MMA will pay special attention to the assumptions and strategy; thus, applicantsshouldtakecaretoprovideappropriateevidenceinsupportoftheseaspects.
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C.
TimelineforMMAevaluationanddecision
Once an applicant has submitted a "complete" application, the MMA is required to either approveordenytherequestedlicencewithinninety(90)daysfromthedatetheapplicationis deemed "complete". However, this time limit may be extended if the MMA determines that additionalinformationisneededinordertofullyevaluateanapplication.Intheeventthatan applicant fails to complete all application filing requirements within a sixmonth period commencing on the date that the first materials were filed, then the MMA may deem the applicationtohavebeenabandonedandanyfurtherconsiderationwillceaseandthefilingfee will be forfeited. If the applicant still wishes to pursue a banking licence, a new application togetherwithanewapplicationfeemustbesubmitted.
TheMMAmaybutisnotrequiredtograntalicenceifitissatisfiedthattheapplicationmeets specificcriteria.Primaryamongthesecriteriaarethefollowing i. Capital
D.
Primarydecisioncriteria
Undercurrentregulations,theminimumcapitalrequirementtostartanewbankinMaldivesis Rf 150 million. When the new banking law comes into force, the minimum absolute capital requirement for a Tier II bank will be Rf60 million, while the requirement for a Tier I licence willbeRf150million.Asprovidedinthedraftbankinglaw,ATierIbankmayengageinallofthe bankingactivitiesspecifiedintheBankingLaw,whileaTierIIbankwillbeauthorisedtoengage inlimitedbankingactivities,andwillhavecertainrestrictionsthatarenotapplicabletoaTierI bank.[ForacompletedescriptionofpermissibleandprohibitedbankingactivitiesforaTierI orTierIIlicense,refertotheBankingLaw.] Theinitialcapitalforanewbankmustbe"incash,free&clear",i.e.nostringsattached,andthe funds cannot be borrowed money. Capital also must be from a verifiable source, i.e. the investorsmustdemonstratetothesatisfactionoftheMMAthesourceofthecapitalizingfunds and its legitimacy since in the current international financial environment, bank licensing and regulatoryauthoritiesmustensurethatbanksarenotknowinglyorevenunknowinglyusedto supportmoneylaunderingorterroristfinancingactivities.
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Applicantwillnotbeallowedtoinjecttheinitialcapitalwithan"inkind"contribution,suchas bycontributingabuilding,land,orotherassets.Thereason forthisisduetothedifficultyin establishingaclearvalueto"inkind"noncashassets.Also,applicantwillnotbeallowedtoput up only a part of the capital now with a "promise" to inject the rest later, nor will they be allowedtoputuppartofthecapitalnowand"earntheirwayup"tothefullamountlater.Initial capital must be the full amount; anything less than the full required amount will be result in denialoftheapplication. ii. Management
Perhapsthemostcriticalaspectcontributingtothesuccessofanewbusinessisthequalityofits management which means all persons who will be members of the board of directors, executive officers, and major shareholders. In the case of banking institutions, evidence has clearlyshownthatthequalityofthesepeople,plustheirpoliciesandproceduresformanaging bankingrisks,comprisethekeyfactorinwhetherabanksucceedsorfails.Therefore,theMMA willverycarefullyconsidertheexperienceandsuitabilityofalldirectors,executiveofficersand major shareholders and will insist that they are "fit & proper" persons as measured against defined,objectivecriteria.TheFitandPropercriteria(PrudentialRegulationNo.092009)that MMAwillusetoevaluatepersonsareattachedasANNEXIIIoftheseguidelines. iii. Businessplan
The third most important criterion for evaluating an application for a banking licence is its businessplan.Applicantsmustsubmitafeasibilitystudyclearlyindicatingthebanksbusiness model and projections. This must be supported with a comprehensive threeyear financial projections(proformafinancialstatements),alongwiththebasisforanyprojections.Applicant shoulddemonstrateareasonablelikelihoodofviabilityandsuccessusingrealisticassumptions and a strategy consistent for the proposed market area of the bank. These projections will be examined,interalia,bycomparingthemwiththepresentandexpectedfutureperformanceof existingbankstoascertainwhethertheforecastsarerealisticandfeasible.Theapplicantmust satisfy the MMA regarding their ability to operate the proposed bank with sound risk management systems that are commensurate for the size and complexity of its business operations. Format for minimum requirements for the business plan is prescribed in these guidelines as ANNEX IV although applicants may submit business plan in other formats providedthatsufficientdetailsareincludedtoenableMMAtothoroughlyassesstheviabilityof the proposed business plan. Some of the more important requirements (monetary measures and prudential requirements) for banking operations have been provided as ANNEX V with these guidelines.
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E.
Additionalconsiderations
The MMA will consider other relevant factors to most thoroughly review the merits of an application.Toassistinevaluatingotherfactors,theMMAwilluseaninformalscoringsystem, andthefinalscoredevelopedusingthe"ScoringEvaluationWorksheet"(seeANNEXVI)willbe part of the overall decision process, subject to an applicant satisfying all applicable criteria. RegardlessofthefinalscorefromtheWorksheet,thedecisiontoapproveordenyanapplication will depend primarily on an assessment of the proposed bank's capital, management and businessplan. i. Astheregulatorofthebanking/financialsector,theMMAisresponsibleforprotectingsystemic stability while at the same time promoting competition and deepening of the financial sector. Thus,MMAwillconsiderwhetherthereisaclearlydemonstratedpublicneedordemandfora new bank or financial institution. In this regard, the MMA may conduct a market survey to independentlydeterminewhetheranapplicant'sclaimthatanewbankisdesiredis,infact,the case.Thus,applicantsshouldincludefactualdatatosupportthedemandforanewbank. ii. Contribution/benefitstoeconomy Publicneed
Consideration will be given to the specific benefits that applicants claim will accrue to the economy, such as substantial new foreign direct investment, creation of employment opportunities,andextensionofbankingservicestotheunbankedorunderbankedareas,etc. Emphasis will be given to the economic needs criteria, i.e., the growth of the economy and bankingdensity.Accordingly,prioritywillgiventoapplicationswhichaddressunfulfilledneeds in the banking industry. Some of the areas/sectors and gaps/needs for consideration may includethefollowing: Thesmallandmediumenterprisesectorandmicrofinance AgriculturalandFisheriessectors Housingfinance Infrastructurelending Electronicbankingorotherformsfordeliveryofbankingservices Islamicbanking
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iii.
Competitiveimpact
In considering an application for a new or merged banking institution, the MMA will consider whetherthenewormergedbankwillcreatebeneficialorbettercompetitionwithinthemarket. Asageneralrule,theMMAwillwelcomenewentrantstothefinancialsectorprovidedthatthey satisfy the three main criteria of capital, fit & proper people, and a viable business plan. However,iftheMMAdetermines,basedoncredibleevidenceorrealisticanalysis,thatanewor mergedbankwillposeadestabilizingoradverseoranticompetitiveinfluenceinthemarket, theMMAwillnotbeinclinedtoapproveanapplication iv. An important consideration when evaluating an application will be the extent to which new/innovativefinancialproductsandserviceswillbeintroducedbythenewormergedbank. TheMMAwilltakenote,forexample,ofanapplicant'splanstointroducenewormorewidely available banking products, new methods of delivering banking services, more favourable pricingofservices,easeofuse,etc.Applicationswhichclearlydemonstrateanabilityandintent toimproveandexpandtheavailabilityoftraditionalaswellas'cuttingedge'financialservices willbeviewedfavourably. v. The MMA encourages and welcomes foreign entrants to the Maldivian banking and financial industryandwillconsiderproposalsfromforeignapplicantaswellaslocalapplicant.MMAwill, however,givespecialconsiderationtoincreasedparticipationoflocalinvestorsbecauseofthe inherentbenefitstothelocaleconomyintermsofretentionofprofitsandattentivenesstothe needsofthelocaleconomy. vi. Ifanapplicationisreceivedfromaforeignbankorfinancialinstitution,theMMAwillassessthe qualityofsupervisionconductedinthehomecountryinwhichtheparentbankorinstitutionis licensed and domiciled. The MMA will also assess the quality of supervision provided by banking authorities in other countries where the bank has material operations. In an application, the applicant should describe the functions and powers of the home country supervisory authority and the extent to which the home country authority exercises comprehensive or consolidated supervision, including the manner in which it supervises the parentbankorholdingcompany,itssubsidiariesandassociates.
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Introductionofnew/innovativefinancialproducts/services
Foreignvs.localownership
Qualityofhomecountrysupervision
vii.
Relationshiptoparentcompany,affiliates,relatedentities
For applicants that are part of a larger organization such as one that has a parent holding companyorvariousaffiliatesand/orrelatedentities,MMAwillconsiderthegroupstructureof the proposed bank and its relationships to the parent, affiliates and other related entities to ensure that (i)theMMAisabletoeffectivelysupervise and evaluatethe new bankwithinthe organizationand(ii)thenewbankwillnotbeadverselyaffectedbyanexistingrelationshipto otherentities,forinstance,bypressurestoprovideloansormakeinvestmentsinotherentities ortopaydividends,managementfeesorotherformsofcontributiontorelatedentities. viii. Financialcondition/performanceofglobaloperations TheMMAmustbesatisfiedthatthefinancialconditionandperformanceoftheapplicantandits parentinstitutionandglobaloperations,totheextentsuchexist,areacceptable.Thisincludes, amongstotherthings,anassessmentofwhethertheglobaloperationsofanapplicantarelikely to adversely impact the applicant's operation in Maldives, and whether the applicant and its parentinstitutionmeetinternationalcapitalrequirementsinaccordancewiththeBaselCapital AdequacyFrameworkandanyotherapplicableregulatoryorsupervisorycriteria. ix. TheMMAmakesnodistinctionnorhasapreferencewhetheraforeignbankappliestoestablish a presence in Maldives either as a branch or as a subsidiary. Foreign banks may apply for licence either to operate in either capacity. The critical factors for the MMA will be whether thereareanyconstraintsorrequirementsposedbytheapplicant'shomecountryregulatorand whether the form of operations in the Maldives will help or hinder MMA's ability to properly superviseandregulatethenewentrant. x. In addition to seeking input from home country bank regulatory authorities, the MMA will requestcommentsfromotherregulatoryandlawenforcementagenciesbothdomesticallyand abroadinsofarassuchagenciesmayhaveinformationnecessaryorappropriatetoevaluatethe meritsofanapplicationandthepeopleinvolved. Comments/advisoriesofotherregulatoryagencies Branchvs.subsidiary
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xi.
Approvalofhomecountryregulator
InthecaseofforeignbankswishingtoestablishabranchorsubsidiaryinMaldives,theMMA will require a letter of "no objection" (or a statement of no objection) from the home supervisor/regulator for purposes of the licensing process, as well as ongoing supervision of crossborderbankingoperations.Asastandardpracticeintheapplicationevaluationprocess, the MMA will contact the home country regulator and solicit information about the applicant andtheproposednewbankorinstitution. xii. The MMA will assume that representations made by the applicant, its major shareholders, executiveofficers,andanyotherpersonsoragentsactingonitsbehalfinconnectionwiththe application are accurate and truthful in all material ways. Stated another way, the MMA will assumethatanapplicationforanewbankissubmittedin'goodfaith',thatallinformationinthe application is true and correct, and that there are no hidden agendas or attempts to gain a licenceonthebasisoffalseormisleadinginformation. However, if the MMA determines that any submission is materially false or misleading, or if a reasonablepersonwouldconcludethatanapplicationwasnotsubmittedingoodfaithbutwas anattempttoobtainabankinglicenceforundisclosedpersonsortobeusedforinappropriate orillegitimatepurposes,thenthatwillbesufficientgroundsforrejectingtheapplicationandthe MMAwillimmediatelydenytheapplicationandtheapplicationfeewillbeforfeited. Goodfaith
IV. Decision
In making a decision, the MMA will either (i) grant a licence (i.e. approve), or (ii) inform the applicantthatitrefusestograntalicence(i.e.deny),statingthegroundsonwhichtherefusalis based. In very unusual circumstances, if the Governor of the MMA certifies that granting a licencewouldnotbeinthepublicinterestofMaldives,thennootherreasonforrefusalneedbe given.However,itwouldbeararesituationforwhichanapplicationwouldbedeniedwithout reasonablejustificationbeingprovidedtotheapplicant.
A.
Preliminaryapproval
OncetheMMAdecidestoissuealicence,apreliminaryapprovalwillbegivencontingentonthe applicant resolving any outstanding issues or concerns that MMA identified during the evaluationprocess.
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B.
Finalapprovalandconditions
Once an applicant satisfies the MMA that it has resolved the outstanding issues or concerns identified in connection with the preliminary approval, if any, final approval for a licence normally will be granted. Upon receiving final approval, every licence will be subject to the followingconditions: 1) representationsmadebytheapplicant,itsmajorshareholders,administrators,etal aspartoftheapplicationwereandareaccurateandtruthfulinallmaterialways; 2) operationsmustcommencewithintwelve(12)monthsorthelicenceapprovalwill lapse; 3) the bank must comply with all regulations, prudential requirements and guidance issuedbytheMMA. 4) thebankmusthaveinternalcontrols,auditproceduresandsystemstomanagethe risksofitsbusiness; 5) thebankmustconductitsaffairsinasafeandsoundmannerandincompliancewith allapplicablelaws,regulationsandotherinstructions; 6) the bank must not engage in criminal activities, i.e. fraud, money laundering or terrorismfinancing; 7) thebankmayoperateonlyunderanamethathasbeenapprovedbytheMMA; 8) the bank must maintain a physical presence in the Maldives where all business is conductedbyatleasttwopersonswhoarefulltimeemployeesofthebank,andthe accountsandrecordsofthebankmustbekeptatthepremisesinMaldives;and 9) every person who is a major shareholder, director or executive officer must be fit andproper. Ifparticularcircumstancesrequire,theMMA,atitsdiscretion,mayimposeotherconditionson the operations of a new bank after the licence is approved or may modify or waive any conditions. The likelihood that this will occur is minimal so long as the applicants have submitted a wellprepared application in good faith and operate their bank in a safe, sound manner and in compliance with applicable laws and regulations. However, if the owners, director and officers of a new bank fail to abide by the conditions listed above or any other conditions that the MMA may impose, such failure will be grounds for MMA to revoke the licenceortotakeotherenforcementactionsasnecessarytopromptlyresolvethesituation.
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C.
Commencingoperations
Apreopeningexamwillbeconductedafteralicenceisapprovedbutbeforethebankopensfor business.Thepurposeofthisbriefinspectionistoensurethatthebankhasthequalifiedpeople asindicatedinthelicenceapplication,thatadequatepolicies&procedureshavebeenadopted andimplemented,andthattherearenounusualormaterialproblemsthatmaydetractfroma successful launch of the new bank. The preopening exam will also serve as a quality control checkontheMMA'slicenceapplicationanalysisanddecisionprocess. Assuming the preopening exam verifies readiness, a 'Certificate of Approval to Commence Operations'willbeissuedallowingthenewbanktoopenforbusiness.Ifthepreopeningexam reveals that the bank is not fully ready to serve the public or if the bank has not started operationswithin12monthsfromthetimethatfinalapprovalofthelicencewasgranted,then thelicencewillbecancelledunlesstherearemitigatingreasonsacceptabletotheregulators.
V.
Revocation,Suspension,Amendments
TheseGuidelinesapplytothelicensingprocessthecreationor"birth"ofanewbank.Itisalso appropriate to discuss the possibility that it may become necessary to revoke, suspend or amendabankinglicence.TheMMAassumes,andwillmakeeveryreasonableefforttoensure, that the owners and managers of a new bank will operate their bank is a safe, sound manner andwillcomplywithalllawsandregulations.However,unforeseensituationsmayarisethat require the MMA to step in and apply regulatory measures to safeguard the interests of depositors and creditors of an individual bank and also the stability of the banking system. These situations likely will be rare, but history has shown that banks can and will encounter difficultiesandinsuchcases,theMMAwillintervene.
Circumstances which would justify MMA intervention would include flagrant violations of banking laws and regulations, gross negligence on the part of directors and executive officers includingegregiousfailuretoconductthebank'saffairsinasafeandsoundmanner,engagingin fraudulent or unlawful activities, or using the bank for purposes materially different than representedintheapplicationforalicence.TheMMAwilldecideeachsituationonacaseby casebasisgivingcarefulconsiderationtoallrelevantfactors.
A.
Justifyingcircumstances
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Dependingontheparticularsofagivensituation,theinterventionorenforcementactionstaken bytheMMAmayincludetemporarysuspensionoftheactivitiesallowedbyalicence,temporary (or permanent) modification or amendment of permissible activities, or in extreme cases the MMAmayfinditnecessarytocancelorrevokealicence.Asageneralrule,theMMAwillapply theleastamountofregulatorypressurenecessarytoachievethedesiredresults;however,the MMAwillnotandlawfullycannotdeclinetoacttopreservetheinterestsofshareholdersor onthebasisofpopularsupportforagivenbankorinstitution.Anyandallactionstakenbythe MMAwillbebasedsolelyontheinherentfactsandMMA'slawfulresponsibilitytoprotectthe stabilityincludingtheinternationalintegrityoftheMaldivianfinancialsystem.
B.
Effect/consequences
VI. Appeals
AsprovidedintheBankingLaw,ordersanddecisionsoftheMMAregardinganapplicationfora licencewillbesubjecttoreviewintheCommercialDivisionoftheCivilCourts,andthescopeof review of the Commercial Division will be confined to whether the decision of the MMA was adoptedfollowinglawfulprocedures,orwasarbitraryorcapricious,orwasotherwisecontrary tolaw.
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ANNEXIApplicationForm
MALDIVESMONETARYAUTHORITY
FINANCIALSECTORDIVISION
APPLICATIONforBANKING/FINANCIALINSITUTION LICENCE
Article29,MaldivesMonetaryAuthorityAct1981 NameofApplicantCompanyorgroup: Contactinformation: Name: PositionorTitle: Address: Telephone&Fax: email:
Dateofapplication:
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INSTRUCTIONS A. GENERAL
InaccordancetotheArticle29(1)oftheMaldivesMonetaryAuthorityAct(1981)nobank orfinancialinstitutionshallcommenceorcarryonbankingbusinessintheMaldives,unless itholdsalicencegrantedbyMaldivesMonetaryAuthority(MMA)forthatpurpose.Assuch, MMA has prescribed licensing conditions in the regulation made there under and other requirementsindifferentcircularsissuesbyMMA. Theseguidelinesareprovidedtoassistyouinpreparingandsubmittinganapplicationthat providesalltherequiredinformationandsatisfiesthecriteriaforapprovalofanapplication. The application is divided into three parts, each relating to a different aspect of the proposedinstitution.Specifically,informationisrequestedaboutthe: Theapplicationandeverydocumentsubmittedwiththisapplicationshallbesignedbythe members of the board of the applicant, or by any principal legally authorised to do so. An applicationwillnotbeconsideredreceivednorwillitbeprocesseduntilthefilingfeeandall supportinginformationarereceived. Whencompletingthisapplicationandthesupportingattachments,youshouldbeguidedby thefollowingtermsandrequirementslistedbelow. Part I II III Aspect ProposedInstitution Directors,ExecutiveOfficers,andShareholderControllers CorporateShareholders
B. TERMS
1. Affiliatemeansanypersonorcompanythatcontrolstheproposedinstitution; any sister company that is controlled by the same company that controls the proposedinstitution;andanyothercompanywhichisownedorcontrolledbya majority of the directors or shareholders who own or control the proposed institution. 2. Bank means a financial institution holding a licence to engage in the banking
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businessinMaldives. 3. Bankingbusinessmeans:(1)thebusinessofreceivingfundsfromthepublicor fromamemberormembersthereofthroughtheacceptanceofmoneydeposits payable upon demand or after a fixed period or after notice, or any operation through the frequent sale or replacement of bonds, certificates, notes or other securities, and the use of such funds either in whole or in part for loans or investments for the account and at the risk of the person doing such business and, (2) any other activity recognised by the Authority as customary banking practice which a financial institution engaging in the activities described in (1) mayadditionallybeauthorisedtodo; 4. Corporate Shareholder means any corporation, partnership, joint venture, associationorotherformoforganizationotherthananaturalperson. 5. Executive Officer includes the chief executive officer (CEO), the chief accounting or finance officer (CAO or CFO), and all other officers who are responsibleformajorfunctionalareasoftheinstitutionincluding,butnotlimited to,thefollowingareas:(a)lendingandcreditadministration;(b)operationsand internalcontrols;(c)investments;(d)treasuryandforeignexchangeoperations; and(e)trustandfiduciaryactivities. 6. Person means any person or legal entity including a corporate, partnership, jointventure,associationorotherformoforganization. 7. Major Shareholder means any person who owns or controls, directly or indirectly,eithernoworuponlicensing,10%ormoreofthevotingstockofthe proposedinstitutionalsoreferredtoasaprincipalshareholder.
C. REQUIREMENTS
1. Responses no application will be considered until complete information is submitted. All responses and documentation submitted with this application mustbetypewrittenorprintedclearlyinink.Allquestionsmustbeanswered; no question may be left blank. If an appropriate answer is "No", "None", "Not Applicable", or "Not Known", so indicate. Additional pages may be added if responsespaceisnotenough.Inaccurateorincompleteinformationwillresult indelaysfortheprocessingofanapplication.
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2. Fees a certified cheque or a bank draft issued by a reputable bank for the prescribed fee and payable to the MMA must accompany the application. The applicationfeeisnotrefundable.Anapplicationwillnotbeconsideredreceived or evaluated until the MMA has received collected funds for the required application fee and all supporting information. Failure to submit the required fee and full information will delay processing and may result in rejection and returnoftheapplication. TheprescribedLicenceApplicationfeesfrom1stNovember2009isRf.150,000.
3. Disclosure the MMA, at its discretion, may disclose to other regulatory authorities, either domestic or foreign, any information contained in this application or obtained from other sources if the MMA considers it necessary andrelevantforproperlyevaluatinganddecidingonthisapplication. 4. Submission the MMA will only consider an application to be complete and officially submitted when all required information and the application fee have beenreceived.Ifallrequiredinformationandthefeearenotreceivedwithinsix monthsofthedatewhentheapplicationisfirstsubmitted,theapplicationwillbe deniedandreturned,andthefilingfeeforfeited.Anyfurtherconsiderationwill requiresubmissionofafreshapplicationandanewapplicationfee.
Anoriginalplusoneduplicateoftheapplicationandallsupportingattachmentsmustbe submittedinonecompletepackageto: TheExecutiveDirector FinancialSectorDivision MaldivesMonetaryAuthority BoduthakurufaanuMagu,Male RepublicofMaldives
5. Inquiries any inquiries concerning the preparation, documentation, required fees,orstatusofthisapplicationshouldbeaddressedtotheabove:
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CRITERIA
tobesatisfiedfor APPROVALofFINANCIALINSTITUTIONLICENCE TheMMAmaygrantalicence,pursuanttoArticle29oftheMMAActandtheRegulationmade thereunder,ifsatisfiedthatminimumcriterionhasbeenmet.Theminimumcriteriaarelisted aresummarizedbelow: a) ApplicantmustbeacorporateentityintheMaldives,iftheyarenotintendingtoopena branchofanexistingbank.Ifanexistingbankistoapplyforalicencetoopenabranch the licence will be given to the existing bank, however, once the licence is given the branchhastobereregisteredintheMaldives. b) Applicantmusthavesufficientcapital c) Directorsandofficersmustbefitandproper d) Applicantmustshowaviablebusinessplan e) Proposednameoftheapplicantmustbeacceptable Additionalconsiderations i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii. Publicneed Contribution/benefitstotheeconomy Competitiveimpact Introductionofnew/innovativefinancialproductsandservices Foreignvslocalownership Qualityofhomecountrysupervision Relationshiptoparentcom[any,affiliatesandrelatedentities Financialconditionandhistoryoftheapplicantandtheglobaloperations Branchvssubsidiary Comments/advisoriesofotherregulatoryagencies Approvalofhomecountryregulator Goodfaith Thefollowingfactorsshouldalsobeconsidered: (a) BorrowedFunds.Theuseofborrowedfundstosatisfytheminimumpaidupequitycapital requirementswillnotbeallowed.Evidencethatborrowedfundshavebeenusedforinitial capitalizationwillbegroundsfordenialofanapplication.
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(d)Interlocking Directorship. No person will be allowed to be a director of an institution if he/sheisalsoadirectorofanynonaffiliatedfinancialinstitution.Forpurposesherein,the term "financial institution" includes insurance companies, mortgage companies, securities firms,andanyotherfirmthatprovidesfinancialservicesinRepublicofMaldives.Evidence thatthislimitationhasbeencircumventedwillbegroundsfordenial. (e) Executive Officers. Each institution must have a chief executive officer (CEO), a chief accounting or financial officer (CAO or CFO), and other officers responsible for all major functional areas including, but not limited to: (a) lending and credit administration, (b) operations and internal controls, (c) investments and assetliability management, (d) treasury and foreign exchange operations, and (e) trust and fiduciary activities. No one personmaybeappointedtoholdtwoormoresuchofficesatthesametime.
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DECLARATION
inrespectof
APPLICATIONforBANK/FINANCIALINSITUTELICENCE
I/We,theundersigned,actingforandonbehalfoftheapplicant,doherebycertifythat: (a)allinformationgiveninresponsetoandinsupportofthequestionsinthisapplicationis trueandcorrecttothebestofmy/ourknowledgeandbelief;and (b) the personal data and financial statements submitted with respect to each director , executiveofficerandmajorshareholdersaretrueandcorrecttothebestofmy/ourknowledge andbelief;and (c) this application is made in good faith with the purpose and intent that the affairs and business of the proposed institution will be conducted, at all times, prudently, in accordance withsoundbusinessprinciples,infullcompliancewithallapplicablelawsanddirectives,andin substantialconformitytothebusinessplansubmittedinsupportofthisapplication. I/Wefurthercertifythattothebestofmy/ourknowledgeandbelieftherearenootherfacts orinformationrelevanttothisapplicationofwhichtheMMAshouldbeaware,andI/wepledge topromptlyinformtheMMAofanychangesmaterialtothisapplicationwhichmayarisewhile itisbeingconsideredbytheMMA.
Finally, I/we give my/our consent that the MMA, at its discretion, may disclose to other regulatory authorities, either domestic or foreign, any information contained in thisapplicationorobtainedfromothersourcesiftheMMAconsidersitnecessaryand relevantforproperlyevaluatinganddecidingonthisapplication.
Signatures: __________________________________ ApplicantorAgent __________________________________ ApplicantorAgent __________________________________ ApplicantorAgent __________________________________ ApplicantorAgent __________________________________ ApplicantorAgent Date:_____________________________
_________________________________ (printname) _________________________________ (printname) _________________________________ (printname) _________________________________ (printname) _________________________________ (printname)
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PARTI:PROPOSEDINSTITUTION
This section requests information about the proposed institution. Respond fully to all of Questions 125. The MMA may require submission of other information as necessary to adequatelyassessthemeritsofthisapplication. 1. Name,Address,OtherActivities Providetheproposednameandmailingaddress oftheproposedinstitution.Indicateanyothername/stheinstitutionplanstouseorhas previouslyusedinconnectionwithanybusinessconductedbyit.Indicatealsowhether the proposed institution is licensed to and/or conducts banking or other business activities in any country or territory other than Republic of Maldives. If so, provide details of such activities including authorizations or licenses held and the names and addressesoftheauthorizingorlicensingagencies. 2. ContactPersonProvidethename,address,andtelephonenumberoftheperson/sto becontactedregardingthisapplication. 3. LegalFormProvidethelegalformoftheproposedinstitution:(checkone) _____Corporation _____Other(specify__________________________) 4. Incorporation Dateofincorporationofproposedinstitution: ProvideacopyoftheAct,charter,deedofsettlement,constitutionorotherdocumentby whichthebodycorporateis,constituted 5. DirectorsandOfficers.Providethenames,addresses,andoccupationsofthepersons whowillbedirectorsandexecutiveofficersoftheproposedinstitution. DirectorName ______________________ ______________________ ______________________ ______________________ ______________________ Address ________________________ ________________________ ________________________ ________________________ ________________________ Occupation ______________________ ______________________ ______________________ ______________________ ______________________
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OfficerName ______________________ ______________________ ______________________ ______________________ ______________________ 6. Business Relationships: (a) Describe all business relationships, if any, which any directororexecutiveofficerhas,ormayhave,withtheproposedinstitution.Bespecific. (b)Borrowings.Towhatextentwillanydirectororexecutiveofficerborrowfromor beindebtedtotheproposedinstitution? (c)Guarantees,etc.Isanybusinessorobligationofanydirectororexecutiveofficerof the proposed institution or of any of his related interests directly or indirectly guaranteed, underwritten, secured, or otherwise expected to be by the proposed institution?Ifso,providedetails. (d)Consulting,ManagementorServiceContracts.Towhatextentwillanydirector orexecutiveofficer,oranyofhis/herrelatedinterests,provideconsulting,management advisory,orothertypesofservicesundercontractualarrangementorotherwisetothe proposedinstitution?Providedetails. 7. Auditors Provide the name, address, telephone number and responsible partner/s of the independent accounting firm that will be engaged by the proposed institution to conductitsannualaudit. 8. AffiliatesProvidethename,address,andtypeofbusinessofanycompanywhichis,or willbeaffiliatedinanywaywiththeproposedinstitution. 9. MajorShareholderofAnyOtherFinancialInstitution.Willtheproposedinstitution ownorcontrol10%ormoreofthevotingsharesofanyotherfinancialinstitution?Ifso, providedetailsincludingpercentageandformofownershipheld. 10. Membership in Professional or Trade Associations If the proposed institution, or anyaffiliatethereof,isnoworwillbeamemberofanyprofessionalortradeassociation
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Address ________________________ ________________________ ________________________ ________________________ ________________________
Positiontobeheld ______________________ ______________________ ______________________ ______________________ ______________________
for the financial activities in the Republic of Maldives or elsewhere, provide details includingwhethersuchmembershiphaseverbeenrefusedorterminated. 11. Censures Has the proposed institution or any affiliate thereof ever been censured, prosecuted,warnedastoconduct,disciplined,orpubliclycriticizedby,ormadesubject toacourtorderbyanygovernmentaldepartmentoragency,professionalassociation,or regulatorybodyinRepublicofMaldivesorelsewhere?Ifso,providedetails. 12. Convictions or Administrative Orders. Has the proposed institution or any affiliate thereofeverbeenconvictedofanyoffense,orhasapetitionforanadministrativeorder beenservedontheproposedinstitutionoranyaffiliatethereofinRepublicofMaldivesor elsewhere,withinthelast10years?Ifso,providedetails. 13. Investigations. Has the proposed institution or any affiliate thereof ever been or is it now subject to an investigation, in Republic of Maldives or elsewhere, by or at the instigationofanygovernmentaldepartmentoragency,professionalassociation,orother regulatorybody?Ifso,providedetails. 14. Litigation.Istheproposedinstitutionoranyaffiliatethereofengagedorexpectingtobe engaged in litigation, in Republic of Maldives or elsewhere, which may have a material adverse effect on the resources of the proposed institution or its promoters? If so, providedetails. 15. Judgments.Hastheproposedinstitutionoranyaffiliatethereofwithinthelast10years, failed to satisfy within one year a judgment of debt under a court order in Republic of Maldivesorelsewhere?Ifso,providedetails. 16. Fraud.Hastheproposedinstitutionoranyaffiliatethereofeverbeenjudgedbyacourt, in Republic of Maldives or elsewhere, to be civilly liable for fraud, malfeasance, or any othermisconduct?Ifso,providedetails. 17. BankruptcyorDebtCompromise.Hastheproposedinstitutionoranyaffiliatethereof been judged bankrupt by a court, in Republic of Maldives or elsewhere, or has a bankruptcypetitioneverbeenservedontheproposedinstitutionoranyaffiliatethereof withinthelast10years,orhastheproposedinstitutionoranyaffiliatethereofmadeany compromiseorotherwisefailedtosatisfyitscreditorsinfullwithinthelast10years?If so,providedetails.
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18. Receiver. Has a receiver of any property of the proposed institution or any affiliate thereofbeenappointedwithinthelast10yearsinRepublicofMaldivesorinanyother jurisdiction?Ifso,providedetailsincludingwhetherthereceiverisstillactingunderthe appointment. 19. Liquidation: (a)Voluntary.Hasanoticeofresolutionforthevoluntaryliquidationofanyaffiliateof theproposedinstitutionbeenissuedwithinthelast10yearsinRepublicofMaldivesor in any other jurisdiction? If so, provide details including whether the liquidation has beenfullyresolved. (b) Compulsory. Has a petition for the compulsory liquidation of any affiliate of the proposedinstitutionbeenservedwithinthelast10yearsinRepublicofMaldivesorin any other jurisdiction? If so, provide details including whether the petition has been fullyresolved. 20. IncomeTaxes. (a) To what date have the tax computations of the applicant been agreed by the Tax RevenueAuthoritiesinotherjurisdictionsthanRepublicofMaldives? (b) To what date have the assessments as noted above been satisfied or otherwise settled? (c) Are material matters in dispute between the applicant and the Tax Revenue Authoritiesinanyjurisdiction?Ifso,providedetails. 21. CapitalStructure. Indicatethecapitalstructureoftheproposedinstitution. Authorizedcapital Paidupcapital Totalissuedshares Parvaluepershare 22. ShareholderList Provideacompletelistoftheinitialshareholdersoftheproposedinstitution.Indicate theshareholdername,address,nationality,and numberofsharestobe owned.Ifany shareholder or group of related shareholders will own or control 10% or more of the sharesoftheproposedinstitution,soindicateandincludethepercentagetobeowned.
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Rf______________ Rf______________ ______________ Rf______________
Totalauthorizedshares______________
23. AcquisitionDebt Towhatextentwillborrowedorencumberedfundsbeusedbytheinitialshareholders, either directly or indirectly, to purchase their shares? Provide full details on the amounts,sources,collateral,andrepaymenttermsforanysuchborrowedfunds. 24. PremisesandEquipment Describe the premises and equipment to be used by the proposed institution. Indicate whether the premises and equipment will be owned or leased, costs of acquisition or leasepayments,andfromwhompurchasedorleased. 25. BusinessPlan Submitadetailedbusinessplanfortheproposedinstitutionusingtheformatprovided with this application forms. At least three years projections must be included, and assumptionsusedinpreparingtheplanandtheprojectionsmustberealisticandbased oncomparativedataforthemarket/stobeservedandtheexistingeconomicconditions. Provideanyotherinformationregardingtheproposedinstitutionoranyaffiliatethereof whichmayassisttheMMAinevaluatingthisapplication.
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PARTII:DIRECTORS,EXECUTIVEOFFICERSandMAJOR SHAREHOLDER
Thissectionrequestsbiographicalandfinancialinformationonnaturalpersonswhoareorwill bedirectors,executiveofficers,ormajorshareholdersoftheproposedinstitution.Acomplete SectionIImustbefilledoutandsubmittedforeachsuchperson. RespondfullytoallQuestions125.AdetailedpersonalfinancialstatementandaCVmustbe provided for each person who is or will be director, executive officer, or major shareholder usingtheformprovided.Supportingschedulesmustbeincludedtoexplainaggregateddataand forallrealestate,notesandaccountsreceivable,andproprietaryinterestsinunlistedsharesor closely held companies. Methods and assumptions used in establishing values for real estate, unlistedshares,orcloselyheldcompaniesmustbefullydisclosed.Datesandamountsshownin the supporting schedules must correspond to those shown in the financial statement. If unlisted shares are shown as an asset and if such shares represent 10% or more of the net worth of the person submitting the financial statement, then financial statements for the underlyingcompany/iesmustbeprovidedforthemostrecenttwofullyears. The MMA may require submission of additional information, including real estate or business valuations,inordertoaccuratelyassessfinancialstrengthandcapacity. 1. Name,Address Providethefullnameandphysicaladdress(currentandpermanentorimmediatepast)of theperson whowillbe adirector,executive officer,ormajorshareholderoftheproposed institution. 2. Position Providethepositionand/ortitletheabovepersonwillholdintheproposedinstitution. 3. Nationality Providethecitizenshipandnationalidentityorpassportnumberoftheaboveperson. 4. Birthdate Providethedateandplaceofbirthoftheaboveperson.
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5. Role,Responsibilities,andReporting Discuss the role the above person will have in organizing and managing the affairs of the proposed institution. Indicate to whom the person will report and/or from whom he will receive directions or instructions. If the person will be an executive officer, describe the specific duties and responsibilities for the position(s) to be held. If the person will be a directorandwillalsohaveexecutiveofficerresponsibilitieswithintheproposedinstitution, indicatethenatureandextentofsuchresponsibilities. 6. Qualifications Provide a current CV (less than one year old) listing the professional and academic qualificationsoftheaboveperson. 7. EmploymentHistory Provide in the CV the following information regarding the employment history and professionalexperienceoftheabovepersonforthepast10years. (a)Nameandaddressofemployer (b)Natureortypeofbusiness (c)Titleandduties/responsibilities (d)Dateemployed,anddateandreasonforleaving Provide complete details regarding positions held in financial institutions, the number of employees and/or assets supervised, lending authority, etc. and the performance of the institutionordepartmentforwhichresponsible. Ifthepersonhaseverbeendismissedor otherwise terminated from any office or employment, been subject to disciplinary proceedings,orbarredfromentrytoanyprofessionoroccupation,providedetails. 8. Affiliations Provide the name of any other financial institution with which the above person is now or will be affiliated as a director or executive officer. Indicate his title or official capacity, duties/responsibilitiesintheotherbank,anddescribeanyrelationshipwhichnowexistsor willexistbetweentheotherinstitutionandtheproposedinstitution. 9. MajorShareholderofAnyOtherFinancialInstitution
If the above person is now or ever has been a major shareholder (owning 10% or more of voting shares) of any other financial institution, provide details thereof including any relationship which now exists or will exist between the other financial institution and the proposedinstitution.
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10. MembershipinProfessionalorTradeAssociations If the above person is now or will be a member of any professional or trade association concerned with financial activities in Republic of Maldives or elsewhere, provide details includingwhethersuchmembershiphaseverbeenrefusedorterminated. 11. Censures Hastheabovepersoneverbeencensured,prosecuted,warnedastoconduct,disciplined,or publiclycriticizedby,ormadesubjecttoacourtorderbyanygovernmentaldepartmentor agency,professionalassociation,orregulatorybodyinRepublicofMaldivesorelsewhere?If so,providedetails. 12. ConvictionsorAdministrativeOrders Has the above person ever been convicted of any felony offense, or has a petition for an administrative order been served on him, in Republic of Maldives or elsewhere, within the last10years?Ifso,providedetails. 13. Investigations Has the above person ever been or is he now subject to an investigation, in Republic of Maldivesorelsewhere,byorattheinstigationofanygovernmentaldepartmentoragency, professionalassociation,orotherregulatorybody?Ifso,providedetails. 14. Litigation Istheabovepersonengagedorexpectingtobeengagedinlitigation,inRepublicofMaldives orelsewhere,whichmayhaveamaterialeffectonhisresourcesorhisabilitytofinancially supporttheproposedinstitution?Ifso,providedetails. 15. Judgments Hastheaboveperson,withinthelast10years,failedtosatisfywithinoneyearajudgmentof debtunderacourtorderinRepublicofMaldivesorelsewhere?Ifso,providedetails. 16. Fraud Hastheabovepersoneverbeenjudgedbyacourt,inRepublicofMaldivesorelsewhere,to becivillyliableforfraud,malfeasance,oranyothermisconduct?Ifso,providedetails. 17. BankruptcyorDebtCompromise Hastheabovepersonbeenjudgedbankruptbyacourt,inRepublicofMaldivesorelsewhere, or has a bankruptcy petition ever been served on him within the last 10 years, or has he
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madeanycompromisearrangementorotherwisefailedtosatisfyhiscreditorsinfullwithin thelast10years?Ifso,providedetails. 18. Receiver Hasareceiverofanypropertyoftheabovepersonbeenappointedwithinthelast10yearsin RepublicofMaldivesorinanyotherjurisdiction?Ifso,providedetailsincludingwhetherthe receiverisstillactingundertheappointment. 19. Liquidation (a)Voluntary Hasanoticeofresolutionforthevoluntaryliquidationoftheabovepersonbeenissued within the last 10 years in Republic of Maldives or in any other jurisdiction? If so, providedetailsincludingwhethertheliquidationhasbeenfullyresolved. (b)Compulsory Hasapetitionforthecompulsoryliquidationoftheabovepersonbeenservedwithinthe last10yearsinRepublicofMaldivesorinanyotherjurisdiction?Ifso,providedetails includingwhetherthepetitionhasbeenfullyresolved. 20. IncomeTaxes Is the above person in good standing with the Inland Revenue Authority in Republic of Maldivesorinanyotherjurisdiction,ordoeshe/shehaveanytaxliabilitieswhichareunpaid orindispute? 21. ShareRegistrations How many shares in the proposed institution are or will be registered in the name of the abovepersonorinthenameofarelatedparty?Providethename(s)inwhichtheshareswill beregisteredandtheclassofsharesifnotordinaryshares. 22. BeneficialInterest How many shares in the proposed institution, which are not registered in the name of the above person or in the name of a related party, will the above person, have a beneficial interestin?Providethename(s)inwhichtheshareswillberegisteredandthenatureofthe beneficialinterest 23. TrusteeorNominee Does or will the above person or any party related to him hold shares in the proposed institutionasatrusteeornominee?Ifso,providedetails.
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24. AssignmentsorPledges AreorwillanyofthesharesinresponsetoQuestions2123beequitablyorlegallyassigned orpledgedtoanyotherparty?Ifso,providedetails. 25. VotingAuthority (a) Direct What proportion of the voting shares at any general meeting of the proposedinstitution,orofanyotherorganizationofwhichtheproposedinstitutionis a subsidiary, is or will the above person be entitled to vote or exercise control over? Providedetailsofsuchvotingauthorityorcontrol. (b)IndirectIftheexerciseofvotingpoweratanygeneralmeetingoftheproposed institution, or of any other organization of which the proposed institution is a subsidiary, is or may be controlled or influenced by someone other than the above person,providetheidentityofsuchotherpersonandtheproportionofvotingpower socontrolledorinfluenced. Provide any other information regarding the proposed director, executive officer or majorshareholderwhichmayassisttheMMAinevaluatingthisapplication.
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PARTIII:CORPORATESHAREHOLDERS
This section requests background and financial information on entities that are or will be corporateshareholders(CSs)oftheproposedinstitution.AcompleteSectionIIImustbefilled outandsubmittedforeachCSthatownsorcontrols,orwillownorcontrol,10%ofmoreofthe outstandingsharesoftheproposedinstitution. Respond fully to all of Questions 125. Detailed, audited financial statements (balance sheet, incomestatementandcashflowstatement)mustbeincluded.Supportinginformationmustbe includedasnecessarytoexplainaggregateddataandmustbeincludedforrealestate,notesand accounts receivable, and proprietary interests in unlisted shares or closely held companies. Methodsandassumptionsusedinestablishingvaluesforrealestate,unlistedshares,orclosely heldcompaniesmustbefullydisclosed.Datesandamountsusedinthesupportingschedules mustcorrespondtothoseinthefinancialstatements.Ifunlistedsharesareshownasanasset andrepresent10%ormoreofnetworth,financialstatementsfortheunderlyingcompany(ies) mustbeprovidedforthemostrecenttwofullyears. The MMA may require submission of additional information, including real estate or business valuations,inordertoaccuratelyassessfinancialstrengthandcapacity. 1. Name,Address Providethename,address,andbusinessactivitiesoftheCSthatisorwillbeashareholderof theproposedinstitution.Indicatealsoanyothercorporate,business,ortradenameusedby theCS. 2. MannerofControl ProvidethemannerinwhichtheCSwillexercisecontrolorotherwiseexertinfluenceover theaffairsoftheproposedinstitution. 3.
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LegalForm
ProvidethelegalformoftheCS:(checkone) _____Corporation _____Partnership _____Other(specify____________________)
4. Incorporation ProvidethedateandcountryofincorporationorformationofCSandacertifiedcopyofthe documentevidencingincorporation. 5. Directors,ExecutiveOfficers,andmajorshareholders Providethefollowinginformationforeachdirector,executiveofficer,andmajorshareholder oftheCS. Name _________________ _________________ _________________ _________________ 6. RegisteredAddress Providetheregistered/legaladdressoftheHeadOfficeandprincipalplaceofbusinessofthe CS,ifdifferentfromthatshowninQuestion1above. 7. AuditorsandBankers ProvidethenamesandaddressesoftheCS'sauditorsandbankersduringthepast10years. Indicateacontactpersonforeachsuchauditfirmandbank. 8. Affiliates Providethename,address,andtypeofbusinessforanyorganizationwhichisorwillbein anywayaffiliatedwiththeCS. 9. MajorShareholderofAnyOtherFinancialInstitution If the CS is now or ever has been a major shareholder (owning 10% or more of the voting shares)of anyother financialinstitution,providedetailsthereofincluding anyrelationship which now exists or will exist between the other financial institution and the proposed institution. 10. MembershipinProfessionalorTradeAssociations If the CS is now or will be a member of any professional or trade association for financial activities in Republic of Maldives or elsewhere, provide details including whether such membershiphaseverbeenrefusedorterminated.
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Address _____________ _____________ _____________ _____________
Title/PositioninCS __________________ __________________ __________________ __________________
%sharesowned ________ ________ ________ ________
11. Censures Has the CS ever been censured, prosecuted, warned as to conduct, disciplined, or publicly criticizedby,ormadesubjecttoacourtorderbyanygovernmentaldepartmentoragency, professional association, or regulatory body in Republic of Maldives or elsewhere? If so, providedetails. 12. ConvictionsorAdministrativeOrders HastheCSeverbeenconvictedofanyfelonyoffense,orhasapetitionforanadministrative orderbeenservedontheCS,inRepublicofMaldivesorelsewhere,withinthelast10years? Ifso,providedetails. 13. Investigations Has the CS ever been or is it now subject to an investigation, in Republic of Maldives or elsewhere,byorattheinstigationofanygovernmentaldepartmentoragency,professional association,orotherregulatorybody?Ifso,providedetails. 14. Litigation Is the CS engaged or expecting to be engaged in litigation, in Republic of Maldives or elsewhere,whichmayhaveamaterialeffectonitsresourcesorabilitytofinanciallysupport theproposedinstitution?Ifso,providedetails. 15. Judgments HastheCS,withinthelast10years,failedtosatisfywithinoneyearajudgmentofdebtunder acourtorderinRepublicofMaldivesorelsewhere?Ifso,providedetails. 16. Fraud HastheCSeverbeenadjudgedbyacourt,inRepublicofMaldivesorelsewhere,tobecivilly liableforfraud,malfeasance,oranyothermisconduct?Ifso,providedetails. 17. BankruptcyorDebtCompromise HastheCSbeenjudgedbankruptbyacourt,inRepublicofMaldivesorelsewhere,orhasa bankruptcypetitioneverbeenservedontheCSwithinthelast10years,orhastheCSmade anycompromiseorotherwisefailedtosatisfyitscreditorsinfullwithinthelast10years?If so,providedetails. 18. Receiver HasareceiverofanypropertyoftheCSbeenappointedwithinthelast10yearsinRepublic ofMaldivesorinanyotherjurisdiction?Ifso,providedetailsincludingwhetherthereceiver
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isstillactingundertheappointment. 19. Liquidation (a)VoluntaryHasanoticeofresolutionforthevoluntaryliquidationoftheCSbeenissued withinthelast10yearsinRepublicofMaldivesorinanyotherjurisdiction?Ifso,provide detailsincludingwhethertheliquidationhasbeenfullyresolved. (b)CompulsoryHasapetitionforthecompulsoryliquidationoftheCSbeenservedwithin thelast10yearsinRepublicofMaldivesorinanyotherjurisdiction?Ifso,providedetails includingwhetherthepetitionhasbeenfullyresolved. 20. IncomeTaxes IstheCSingoodstandingwiththeInlandRevenueAuthorityinRepublicofMaldivesorany otherjurisdiction,ordoestheCShaveanytaxliabilitieswhichareunpaidorindispute? 21. ShareRegistrations HowmanysharesintheproposedinstitutionareorwillberegisteredinthenameoftheCS orinthenameofarelatedparty?Providethename/sinwhichtheshareswillberegistered andtheclassofsharesifotherthanordinaryshares. 22. BeneficialInterest Howmanysharesintheproposedinstitution,whicharenotregisteredinthenameoftheCS orinthenameofarelatedparty,willtheCShaveabeneficialinterestin?Providename/sin whichtheshareswillberegisteredandnatureofbeneficialinterest. 23. TrusteeorNominee Does or will the CS or any party related to it hold shares in the proposed institution as a trusteeornominee?Ifso,providedetails. 24. AssignmentsorPledges AreorwillanyofthesharesinresponsetoQuestions2123beequitablyorlegallyassigned orpledgedtoanyotherparty?Ifso,providedetails. 25. VotingAuthority (a) Direct What proportion of the voting shares at any general meeting of the proposed institution,orofanyotherorganizationofwhichtheproposedinstitutionisasubsidiary,is or will the CS be entitled to vote or exercise control over? Provide details of such voting authorityorcontrol.
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(b) Indirect If the exercise of voting power at any general meeting of the proposed institution,orofanyotherorganizationofwhichtheproposedinstitutionisasubsidiary,is or may be controlled or influenced by someone other than the CS, provide the identity of suchotherpersonandtheproportionofvotingpowersocontrolledorinfluenced. ProvideanyotherinformationregardingtheCSwhichmayassisttheMMAinevaluating thisapplication.
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ANNEXIIPersonalFinancialStatementFormat
CONFIDENTIALPERSONALFINANCIALSTATEMENT forsubmissionto MALDIVESMONETARYAUTHORITY
Aconfidentialpersonalfinancialstatementreportmustbecompletedandfiledbyeachperson proposing to acquire a significant interest in a financial institution. A significant interest meansowning orcontrolling,directlyorindirectly,10%or more ofthe outstanding equityor anyclassofshareswithvotingrightsofafinancialinstitution.Personincludesanindividual, two(2)ormoreindividualsactinginconcert,anytypeofpartnership,corporation,syndication, trust, or any other organization, or any combination of the forgoing, and the information requiredinthisapplicationisrequiredforeachmemberofthegroup.Aconfidentialpersonal financial statement report must also be completed and filed by each major shareholder, director, and executive officer proposed in connection with an application for a licence to establishanewfinancialinstitution. Supportingschedulestothefinancialstatementshouldbeattachedwhennecessarytoitemize or clarify summarized data. Care should be taken to assure that the dates and total amounts shownonthesupportingschedulescorrespondtothoseonthefinancialstatement.Supporting schedules are included for real estate and related loans and for proprietary interest. The methodsbywhichrealestatemarketvaluesaredeterminedmustbedescribed.Ifinvestment securitiesareshownasanassetandsuchsecuritiesrepresent25%ormoreofanindividuals net worth, financial and cash flow statement of the company for the last two years must be provided,unlessthecompanyispubliclytradedonanationalexchange. Complete enclosed Confirmation Inquiry Form which authorizes any financial institution, brokeragefirm,oranyotherentityinwhichyoumayhaveanaccounttoconfirmtothebalance ormarketvalueofsecuritiesheldinsaidaccountasofacertaindate.Ifyouhaveaccountsat morethanoneinstitution,pleasecompletetheappropriatenumberofforms.Aftercompleting SectionOneoftheConfirmationInquiryform,itmustbesubmittedtotheMMAalongwiththe Confidential Personal Financial Statement. Do not send the Confirmation Inquiry form to the confirminginstitution(s).Allpersonswhohaveownershipinterestintheaccountmustsignthe ConfirmationInquiryform.Otherwise,theconfirminginstitutionmayreturntheforminblank to the MMA, which may result in a delay in processing. Please provide account and loan numbersonforms. The MMA may require submission of additional information, including appraisals, if it is necessarytodeterminefinancialcapacity.
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CONFIDENTIALPERSONALFINANCIALSTATEMENT
of __________________________________________________
(Name) __________________________________________________ (Dateoffinancialinformation) (ReportallamountsUS$in000s) ASSETS CashonHand&inBanks(Schedule1) GovernmentSecurities Accounts,Loans&NotesReceivable(Schedule 2) MarketableStocks&Bonds(Schedule3) Othersharesandinvestments Debtors RealEstate(Schedule4) VehiclesandEquipment ProprietaryInterests(Schedule5) Personalproperty OtherAssets1 LIABILITIES Notes&AccountsPayabletoBanks(Schedule 6) Rents&InterestDue RealEstateTaxesDue(Schedule4) LiensonRealEstate(Schedule4) OtherTaxesDue OtherLiabilities1
vi.
TOTALLIABILITIES vii. NETWORTH
viii.
TOTALASSETS
ix.
TOTALLIABILITIES& NETWORTH
ANNUALINCOME Salary Bonus&Commissions Dividends&Interest RealEstateIncome OtherIncome(Itemize)
CONTINGENTLIABILITIES AsEndorserorCoMaker OnLeasesorContracts LegalClaims ProvisionforIncomeTaxes OtherSpecialDebts(Itemize)
x.
1
TOTALINCOME
xi.
TOTALCONTINGENT LIABILITIES
Assetsvaluedat$________havebeenpledgedtosecureobligationstotaling$_________. Ihaveendorsed,guaranteedoramcontingentlyliablefordebtsofotherstotaling$_________.
Itemizeallamountsgreaterthan10%oftheamountsreportedinOtherassetsandOtherliabilities,respectively.
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Schedule1:BankingRelationships(Listallbankaccounts)
NameofBankorFinancial Institutionincludinga contactperson/details Address TypeofAccount Account Number Total Account Balance
Schedule2:Accounts,Loans&NotesReceivable
NameandAddressof Debtor Date Originated Description/Nature ofDebt SecurityHeld Total MaturityDate BalanceDue
Schedule3:MarketableStocksandBonds.Marketablestocksandbondsincludeonlythose listedonrecognizednationalexchanges.
FaceValue Bonds No.Sharesof Stock Description OfSecurity Registeredin Nameof Cost Income Received LastYear Total IfPledged, StatetoWho Present MarketValue
Schedule4:RealEstate.Legalandequitabletitletoallrealestatelistedbelowissolelyinthe
applicantsnameexceptasfollows:
Description and Location Dimensions or Acres DueDates & Payment Amount UnpaidTaxes Year Amount Total Original Cost
Improvements ConsistOf
Outstanding Mortgages orLiens
Present Market Value
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Schedule5:ProprietaryInterests
Provideinformationbelowforallbusinessenterprisesinwhichyouholdabeneficialinterest.Businessenterpriseincludesany corporation, association, partnership, trust, sole proprietorship or other business for which shares are not listed on a securities exchange or otherwise regularly traded. Under heading Form of Business, indicate legal form of business. Under Nature of Business and Percentage Ownership, indicate business activity and percentage of your ownership interest. Submit yearend financialstatements,includingbalancesheet,profitandloss,andcashflowstatements,forlasttwoyearsforeachbusinessinterest inwhichyourinterestrepresents25%ormoreofyournetworth. NameandAddress OfBusiness LegalForm OfBusiness NatureofBusinessand PercentageofOwnership Date Acquired Total Present Value
Schedule6:Notes&AccountsPayable.
NameofLender LendersAddress DueDates& Payments Security/Collateral Total Outstanding Balance
CERTIFICATION
Iherebycertifythattheinformationprovidedinthefinancialstatementaboveandinthe supportingschedulesistrueandcorrecttothebestofmyknowledgeandbelief,andthat therearenomaterialomissionsormisrepresentationsoffacts.IalsoauthorizetheMMA to request and receive any information necessary to verify the accuracy of information containedinthisfinancialstatement. Signature:___________________________Date:_____________
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CONFIRMATIONINQUIRY
CONFIDENTIALINFORMATION
(Date)______________________________,20___ ________________________________________________________________________ (NameofConfirmingInstitution) (MailingAddress)
____________________________________________________ ____________________________________________________ TotheCEOoftheBankorFinancialInstitutionAddressed:
1. 2.
Please furnish directly to the Maldives Monetary Authority, the following information for all accounts, including any loan accounts, maintained by me at yourinstitution.Iftheanswertoanyitemisnone,indicateaccordingly. Atcloseofbusinesson____________________,20___,ourrecordsshowedthefollowing balance/s to the credit of the above customer (include certificates of deposit, moneymarketcertificates,stocks,bonds,etc.).
AccountName AccountNumber AccountBalance
3. Thecustomerwasdirectlyliabletousinrespectofloans,acceptances,etc.atthe closeofbusinessonthatdateinthetotalamount$____________________asfollows:
DueDate Rate Interest Paidto Amount DescriptionofLiability,Collateral, Security,Loans,Endorsers,Etc.
DateofLoan
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4.

The customer was contingently liable as endorser of notes discounted and/or guarantor at the close of business that date in the total amount of $____________________asfollows:
NameofMaker DateofNote DueDate Amount Remarks
5.

Otherdirectorcontingentliabilities,LettersofCredit,etc.(listbelow):
___________________________
(Date)
____________________________________________________
(ConfirmingInstitution)
(AuthorizedSignature)
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ANNEXIIIFITandPROPERCriteria(PrudentialRegulationNo.09
2009)
These specific requirements are intended to ensure that all persons who are, or will be, administrators2ormajorshareholdersofabankarefitandproperpersonsbasedonprudent andobjectivecriteria.Thefollowingminimumrequirementsshallapply: (b)Theboardofdirectorsofabankshallensurethatthefitandpropercriteriaspecifiedin this regulation are satisfied when appointing or electing or continuing the appointment of an administrator, and shall provide written notice to the MMA not less than 30 days before appointingorelectingapersonasanadministrator; (c)Eachpersonwhoproposestobecomeamajorshareholderofabank,orwhoproposesto increasehisstakeinabankbeyondathresholdsetbytheMMAorinlaw,shallobtainapproval of the MMA prior to acquiring the shares that will make the person a major shareholder or resultinexceedingathresholdsetinlaworbytheMMA. (d) Notwithstanding any provision in (a) to (c) above, the MMA may object to any person being appointed or elected or continuing an appointment as an administrator, or becoming a majorshareholderorincreasinghisstakebeyondathresholdsetbytheMMAorinlaw,ifsuch personisnotfitandproperasdeterminedbytheMMA. (e)Eachpersonwhoisrequiredtobefitandproperpursuanttothisregulationshallmake availabletotheMMAsuchinformationasisreasonablynecessary,intheopinionoftheMMA, fortheMMAtodeterminewhetherthepersonisfitandproper. StandardsWhenconsideringanapplicationforalicencetoconductbankingbusinessinthe Maldives,orwhendecidingwhether toapproveapersonasamajorshareholderofa bank or 2Administratormeansanypersonwhoisadirector,executiveofficer,ormemberoftheaudit committee of a bank, including, in the case of a foreign bank, a designated branch manager and other officers who hold a position of executive officer as the term is definedbelow.
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(a) Each person who is, or will be, an administrator or a major shareholder of a bank, a
subsidiaryofabank,orabankholdingcompanymustbeafitandproperperson.
bank holding company operating in the Maldives, or to approve a person to be appointed or electedasanadministratorofabank,itssubsidiaryorbankholdingcompanyoperatinginthe Maldives,theMMAwillapply,ataminimum,thestandardsandcriteriabelowtoassesswhether apersonisfitandproper. TheMMAwillconcludethatapersonisNOTfitandproperif (a)Competencyapersondoesnothavesufficientcompetency,intermsofrelevant experienceandacademicqualifications,toreasonablyconcludethathe/shewillbeable todischargesatisfactorilythedutiesandresponsibilitiesofhis/herproposedposition. (b)MentalCapacityapersondoesnothavesufficientmentalcapacitiestoreasonably conclude he/she is of sound mind and able to carry out satisfactorily the duties and responsibilitiesofhis/herproposedposition. (c)RemovalorSuspensionapersonhasbeen,orisbeing,removedorsuspended,by order of a bank regulatory authority in the Maldives or in a foreign country, as a director, executive officer or major shareholder of any bank licensed to operate in the Maldivesorinaforeigncountryunlesssuchremovalorsuspensionissolelytheresultof his/her political affiliation and in no way relates to his/her performance, conduct or competencyasadirector,officerormajorshareholderofalicensedbank. (d)OffencesandBreachesapersonhasevercontravenedanyprovisionoftheMMA Act or any rule or order issued thereunder, or has been guilty of gross negligence or willfulorintentionalmisconductasthosetermscontextuallyapplyintheMMAAct. (e)WindingUporLiquidationapersonhasbeen,oris,anadministratorormajor shareholderofabanklicensedtocarryonbankingactivitiesintheMaldivesandwhich bankhasbeen,orisbeing,wounduporliquidatedcompulsorily. (f) Positions in Competing Financial Institutions a person is an administrator or major shareholder of a bank or financial bank operating in the Maldives which is competingwithbutnotasubsidiaryorassociateofthebankinwhichthepersonisor willbeanadministratorormajorshareholder. (g) Censures a person has been censured, disciplined, prosecuted, warned as to conductormadesubjecttoacourtorderbyanygovernmentaldepartmentoragency,by any professional association, or by any regulatory body in the Maldives or elsewhere, withinthelast10years. (h) Convictions or Administrative Orders a person has been convicted of or imprisonedforanyoffense,orhashadanadministrativeorderservedonhim/herinthe Maldivesorelsewhere,withinthelast10years.
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(i) Investigations a person have been or are now subject to an investigation in the Maldives or elsewhere by or at the instigation of any governmental department or agency,professionalassociation,orotherregulatorybody.
(j)Litigationapersonhasengagedorisexpectingtobeengagedinlitigationinthe Maldivesorelsewherewhichmayhaveamaterialadverseeffectontheresourcesofthe proposedbankoritspromoters.
(k)Judgmentsapersonhasfailed,withinthelast10years,tosatisfywithinoneyear ajudgmentofdebtunderacourtorderintheMaldivesorelsewhere. (l) Fraud a person has been judged by a court in the Maldives or elsewhere to be civillyliableforfraud,malfeasance,oranyothermisconduct. (m)BankruptcyorDebtCompromiseapersonhasbeenjudgedbankruptbyacourt intheMaldivesorelsewhere,orhasmadeanycompromiseorotherwisefailedtosatisfy his/hercreditorsinfullwithinthelast10years.
(n)Taxesapersonhasnotsatisfiedallundisputedobligationsfortaxesthataredue andpayabletotheInternalRevenueCommissionoranyothertaxationauthorityinthe Maldivesorinanyotherjurisdiction.
(o)PoliticalOfficeapersonwhowillbeanadministratororamemberoftheboard ofdirectorsofabankisagovernmentofficialwhoheadsagovernmentministryorholds acabinetposition.
(p) Resources in the case of a body corporate, a body corporate does not have, or havereadyaccessto,sufficientfinancial,managerial,technological,intellectualorother relevant resources to reasonably conclude that the body corporate will be able to dischargesatisfactorilythedutiesandresponsibilitiesoftheproposedposition.
TheMMAwillconsidermitigatingcircumstances When assessing whether a person is fit and proper, the MMA will consider mitigating circumstances in respect of criteria (a), (b), (f), (o) and (p). In respect of all other criteria, if a person is determined to be NOT fit and proper but there are compelling reasons why such person otherwise should be allowed to serve as administrator or major shareholder of a bank and if such reasons are acknowledged and agreed to in writingbytheBoardofDirectorsoftheMMAandbytheMinisterofFinance,thenthe MMAwillallowsuchpersontobeappointedortocontinueasanadministratorormajor shareholderundersuchconditionsorrestrictionsastheMMAmayimpose.
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ANNEXIVBusinessPlanFormat
BUSINESSPLAN
A. INTRODUCTION Applicantmustsubmitadetailedbusinessplanaspartoftheapplicationprocess.Inaddition, when establishing a branch or making a significant change in operations such as an amalgamation, an institution will be requested to submit an amended business plan. The business plan should set forth the objectives and strategies of the institution and provide guidanceformanagement.Itshouldbeflexibleandallowforchangeascircumstancesrequire. Changesintheobjectivesorstrategicgoalsshouldbeapprovedbytheboardofdirectorsand incorporated into an amended plan. The MMA will review an institution's business plan at periodicexaminationsorwhenotherregulatoryissuesarise. A suggested format for a business plan is shown below; alternative formats may be used provided that all relevant information is included. The plan must identify the proposed market/s to be served and products and services to be offered, must demonstrate adequate capitalandmanagerialresourcesforthekindsandlevelsofactivities,andshowcomplianceto regulatory requirements. The plan must include operating projections for at least three years andcontainsufficientinformationtodemonstrateareasonablelikelihoodofsuccess.Suggested formatsforbalancesheetandincomestatementareprovidedbelow. The MMA may require submission of additional information after review of the business plan originallyprovided. B. SUGGESTEDFORMAT 1. IdentifyingInformation. (a) Name and location. Provide the name and location of the institution including the location/sofanybranches. (b) Corporate structure. Provide a diagram of the institution's corporate structure includinganyparentcompany,subsidiaries,oraffiliatedentities. (c) Origin and basis. Briefly discuss how the organizing group came together and the reasonsforwantingtostartafinancialinstitution. 2. MarketAnalysis. (a) Market.Identifythemarket/stobeservedbytheproposedinstitution. (b) Economy. Describe the economic characteristics of the target market. Include any anticipated changes in the economy or market, factors influencing such changes, and probablepositiveornegativeimpactontheinstitution. 3. BusinessStrategyandObjectives. (a) Strategy. Briefly describe the vision, mission, business strategy and objectives of the institution.Forstrategyandobjectives,indicategoalsthatarespecificandmeasurable. (b) Services. Brieflydescribetheservicestobeofferedbythe institution andthetype of bankingactivitiestheproposedinstitutionplanstoengagein?(checkallthatapply) _____ Currentaccounts(i.e.checkingdeposits) _____ Timeandsavingsaccounts
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_____ _____ _____ _____ _____ _____ _____ _____ _____
Commercialandindustrialloans Mortgageloans(commercialandresidential) Installment/consumerloansandcreditcards Hirefinanceandequipmentleasing Exportimport/tradefinancing Foreignexchangedealer/broker Underwritingsecurities Managementadvisoryservices Other(specify)__________________________
(c) Assumptions.Listthemajorassumptionsuponwhichprojectionsarebased.Include, at a minimum: market growth rates, competition, interest rates, cost of funds, overhead, assetliability mix, returns on assets and equity, dividend payout rate, and capital ratios (bothleverageandriskbasedratios). (d)Pro forma statements. Provide pro forma balance sheets and income statements for three years. Show expected assetliability mixes, volumes of each type of service to be offered, fixed asset investment, and compensation for management and staff. Adequate provisionsforloanlossesandannualexternalauditmustalsobeincluded.
4. LeadershipandManagement. (a) Officersandcompensation.Providealistofofficersshowingthefees,salaries,andall otherformsofcompensationorbenefitstobepaidtoorforeachperson. (b) Insider agreements. Describe any agreements for leases or services the institution intendstoenterintowithanyofitsdirectors,executiveofficers,orprincipalshareholders, orwithanyorganizationoraffiliatecontrolledbyadirector,executiveofficer,orprincipal shareholder.Providecopiesofanysuchagreementsincludingspecificdetailsofratesand termsandcomparativemarketdatauponwhichtheratesandtermsarebased. 5. CapitalizationandAdditionalSources. (a) Initialcapital.Describetheamountandsourceofinitialcapitalizingfunds. (b) Capitalgrowth.Describeplansforfinancinggrowth,internallyorexternally,overthe firstthreeyearsofoperation. (c) Additional capital sources. Describe what sources of additional capital are available shouldtheneedarise.
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BALANCESHEET($000s)
PROFORMAFINANCIALSTATEMENTS
Year1 Year2 Year3
Assets BalancesatCentralBank BalancesatBanksLocally BalancesatBanksAbroad TreasuryBillsandGovtSecurities LoanstoFinancialInstitutions Commercial,Industrial,AgriculturalLoans RealPropertyMortgageLoans Personal,Consumer,HirePurchaseLoans FXLoans OtherLoans GrossLoans Less:ProvisionsforLoanLosses Less:SuspendedInterest NetLoans OtherSecurities&Investments InterestReceivable Building&Equipment ForeclosedAssets OtherAssets TotalAssets Liabilities&Capital DemandDeposits SavingsDeposits TermDeposits FXDeposits TotalDeposits LiabilitiestoCentralBank LiabilitiestoOtherBanks BorrowedFunds InterestPayable OtherLiabilities TotalLiabilities SubordinatedDebtCapital PaidInCapital RetainedEarnings RevaluationReserves TotalCapitalFunds TotalLiabilities&Capital Memoranda: ContingentLiabilities TotalEarningAssets TotalRiskWeightedAssets EquitytoAssetsRatio Tier1CapitaltoRiskWeightedAssets TotalCapitaltoRiskWeightedAssets GrossLoanstoTotalDeposits LiquidAssetstoTotalDeposits+STLiabilities
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INCOMESTATEMENT($000s)
InterestIncome LoansandLeases SecuritiesandInvestments DepositBalances TotalInterestIncome InterestExpense InterestonDeposits InterestonBorrowedFunds TotalInterestExpense NetInterestIncome ProvisionsExpenseforLoanLosses NetIncomefromLending&Investing NonInterestIncome Fees,Commissions&ServiceCharges FXFeesandTransactionsCharges FXRevaluations OtherNonInterestIncome NonInterestExpense StaffSalariesandBenefits OfficersSalariesandBenefits DirectorsFeesandBenefits AdministrativeandOverheadExpenses AdvertisingandPromotion DepreciationExpense DuesandSubscriptions LicenceRenewalExpense LeaseandRentalExpenses TravelandEntertainmentExpenses OtherNonInterestExpenses NetOperatingIncomeBeforeTaxes Taxes NetOperatingIncomeAfterTaxes ExtraordinaryItems(netoftaxes) NetIncome(Loss) OtherAdditions(Deductions)toCapital Less:CashDividends NetChangeinCapitalAccounts CapitalAccountsBeginningofPeriod CapitalAccountsEndofPeriod Ratios: ReturnonAverageAssets ReturnonAverageEquity AverageYieldonEarningAssets(a) AverageCostofFundingLiabilities(b) NetInterestSpread(ab) NetInterestIncome/AverageEarningAssets AssetGrowth(yronyr) LoanGrowth(yronyr) DepositGrowth(yronyr) CapitalGrowth(yronyr) Year1 Year2 Year3

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BUSINESSPLANCHECKLIST 1. IdentifyingInformation:
Nameofproposedbank. Proposedlocationofmainofficeofthebank. Locationsofbranchesorotherofficefacilitiesproposed. Nameandaddressofparentcompany,ifapplicable. Nameandaddressedofsubsidiaries,ifapplicable. Nameandaddressesofaffiliates,ifapplicable. Explanationofgenesisofproposedtransaction. Reasonsforproposedtransaction(newlicence,changeofsignificantownership interest,issuanceofcapitaldebtinstruments,etc.)
2. MarketAnalysis:
Definitionoftargetmarketareas. Supportingmarketresearch,suchasareademographicsandeconomics. Identificationofmajorfactorsaffectingselectedmarketareas. Analysisofneedsfortargetmarketareas. Identificationandanalysisofcompetitionwithintargetmarketareas.
3. BusinessStrategyandObjectives: Targeted market areas can reasonably produce 75% of business given bank resourcesandtargetedcustomerbase. Servicestobeprovidedarelistedandadequatelydescribed. Strategiesareconsistentwithstatedobjectives. Profitabilityexpectationsandassumptionsarereasonable. Pro forma statements accurately prepared and major assumptions fully disclosedandconsistentwithstrategiestocapture/sustainmarketshare.
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Strategicobjectives,proformastatements,andmarketplansareconsistentwith andamongeachother. Estimatesofoperatingresultsarereasonableandsupported. Planningassumptionsarerealisticforgivenlocale. Asset/liability mix adequately discussed. Bank has procedures to address fundingriskandinterestraterisk. External independent audit program will be provided for first three years of operations.
4. LeadershipandManagement:
Organizationalstructureofproposedbankisadequatelydescribed. Dutiesandresponsibilitiesofallexecutiveofficers/functionalareasofbankare adequatelydetailed. Names, addresses and nationality of all applicant, principal shareholders, directorsandexecutiveofficersarefullydisclosed. Proposeddirectorsandexecutiveofficersarequalifiedinrespectofservicesto beprovidedandtargetedmarketareas. Fees,salaries,andorformsofcompensationfordirectorsandexecutiveofficers arefullydisclosed. Leasing transactions or service agreements involving organizers, principal shareholders, directors and executive officers or related interests thereof, are fullydisclosed.
5. Capitalization/NetWorth:
Initial capitalization complies with minimum statutory requirement and is adequately supported for targeted market areas, strategies, and projected organizationalexpenses. Forapplicationsfornewlicenses,proposedcapitalizationisadequateforatleast firstthreeyearsof operation. Forotherapplications,planstomaintaincapital comply with regulatory requirements and are adequately detailed and reasonable. Plans to raise capital, initially and to support growth are wellformulated and reasonable. Current and proposed debts of bank promoters are fully disclosed and debt service requirements do not adversely affect bank. Shareholders of proposed
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bankpossesssufficientpersonalresourcestoserviceanypersonaldebtswithout undue pressure on bank for dividends or other compensation, or such shareholders can demonstrate that reliance placed on bank earnings will not endangersafety,soundnessorcapitaladequacy. 6. ProFormaStatements
Detailed pro forma balance sheets and income and expense statement show asset,liabilityandcapitalprojectionsforaminimumofthreeyears. Ataminimum,informationshowninschedulesmustbeprovidedforabusiness plan to be acceptable. Additional supporting data should be included where necessary to explain important elements of planned asset and liability mix. Averageannualbalances(notyearendestimates)shouldbeusedforproforma balance sheet projections. Assumptions used in preparation of pro forma statements(interestrates,loanyields,costoffunds,etc.)mustbeprovided.
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ANNEXVCurrentMonetaryandPrudentialRequirements
ExistingPrudentialRequirements RepatriationofProfits:BanksmustobtainpriorapprovalfromMMAforallpaymentsandprofit repatriationtotheirheadofficesoverseas.(31December1996) AML/CFTandSuspiciousTransactions:Banksarerequiredto(1)formulateandadoptwritten policies and procedures to prevent money laundering and financing of terrorism, (2) provide adequate staff training for effective prevention, detection and control of possible money laundering/terrorismfinancingactivities,(3)accuratelyidentifyallcustomersandunusualand suspicioustransactions,(4)maintaincustomerinformation,(5)appointaComplianceOfficer", and(6)reportalltransactionsthatindicatepossiblemoneylaunderingorattemptstoconceal thetrueidentityofcustomersorownershipofassetstoMMA.(7March2006) PrudentialRegulations The followingprudentialregulationsbecame effectiveon18thMay2009andare available on MMAwebsite(www.mma.gov.mv). 1. CapitalAdequacy 2. SingleBorrowerandLargeExposureLimits 3. Limitsonloanstorelatedpersons 4. TransactionswithRelatedPersons 5. AssetClassification,ProvisioningandSuspensionofInterest 6. Limitsoninterbankexposures 7. Fitandproperrequirements 8. ExternalAudits 9. PublicationandDisclosureRegulation 10. CorporateGovernance BankingLaw AformalBankingLawhasbeendevelopedinconformitytointernationalstandardsformodern legal frameworks for banking and financial systems. It is expected that the draft law will be submittedtotheParliamentinthenearfutureandwillbeenactedwithintheyear2009. Taxation TaxonProfits:BanksoperatinginMaldivesarerequiredtopayaprofittaxof25%ofnetprofits. (Law9/85of27June1985) InterestRates USDLoansandDeposits:Banksarefreetosetinterestratesonloansanddepositsdenominated inUSD.(24June1995)
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Rf Loans: Banks are free to set interest rates on loans and advances denominated in rufiyaa providedthattheratedoesnotexceed20%perannum.(24June1995) RfDeposits:Banksarefreetosetinterestratesonrufiyaadeposits.(15August2001) MinimumReserveRequirement(MRR) The Minimum Reserve Requirement (MRR) for commercial banks was reduced to 25% (from 30%) based on the average demand and time liabilities in both rufiyaa and foreign currency. The first 15% of minimum reserve deposits earn no interest. Reserve requirements must be satisfiedinthesamecurrencyastheunderlyingdepositliabilities.(1June2006) Rfbalancesinexcessof15%earninterestat2.5%PA.(1June2006) Theforeigncurrencydepositsinexcessof15percentearninterestat0.25percentperannum (30December2008). TreasuryBills MMAistheissuingandpayingagentforTreasuryBills(TBills)issuedbyGovernment.Banks andpublicenterprisesmaypurchasesuchTBills.TBillsareissuedatmaturitiesof28daysand 91days,andinterestrates(asofJuly2009)are6.0%for28daysand6.25%for91days.TBills aredenominatedinrufiyaa,soldatadiscounttopar,andcarrynocoupon.(10September2006) RepurchaseFacility A Repurchase Facility was introduced to replace the Lombard Facility as a mechanism for providingshorttermrufiyaaliquiditytocommercialbanks.Termsare1to7daysandtherepo rateissetatamarginabovetheonemonthTBillrate.(23November2006)
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ANNEXVIScoringEvaluationWorksheet
TheMMAwillusethis'ScoringEvaluationWorksheetasatooltoassistinevaluatingrelevant factors in connection with an application for a banking licence. However, the resulting score will not be the primary determinant whether an application is approved. The resulting final score will be considered in the overall decisionmaking process, subject to an applicant satisfying all licensing criteria, especially those relating to initial capital, the suitability of personsproposedasdirectors,officersandmajorshareholders,andthebusinessplan.
Worksheetmethodology:TheMMAwillconsidereachRelevantFactorinthetablebelowandassignascoreranging from0to10points.Amaximumof10pointsisallowedforeachFactor.Ascoreof0willindicatethattheresultsor impactareexpectedtobeclearlyadverseornonbeneficial,whileascoreof10pointswillindicatethattheresultsor impactareexpectedtobeclearlypositiveorbeneficial.IntheeventthataFactorisnotapplicable,noscorewillbe assignedforthatFactor.TheMaximumPointswillbereducedbyamultipleof10,andtheresultingtotalscorewill berecomputedtoshowtheequivalentof"totalpointsoutofapossiblemaximumof100".
Item 1 RelevantFactor PublicNeed Is there a clearly demonstrated need and/or public demand, based on credible market survey data, for a new bankorfinancialinstitution?[Providesupportingcomments.] Contribution/BenefitstoEconomy Aretherespecificbenefitsthatwillaccruetotheeconomy, e.g.substantialnewforeigndirectinvestment,employment opportunities, wider access to banking services, business expansion?[Providesupportingcomments.] CompetitiveImpact Is the new bank likely to create or improve competition within market, or will it produce a destabilizing or anti competitiveinfluence?[Providesupportingcomments.] Maximum Points 10 Score
10
10
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4 New/InnovativeProducts&Services Will the new bank offer new and/or more innovative banking products, new methods of delivery, more favourable pricing? Do applicants clearly demonstrate an abilityandintenttoimproveandexpandtheavailabilityof traditional as well as 'cutting edge' financial services? [Providesupportingcomments.] Foreignvs.LocalOwnership Will the new bank be dominated by foreign investors, or will local investors have a material opportunity for ownership? Willthelocaleconomyrealizesubstantialbenefitsthrough retentionofprofitsandattentivenesstolocalneeds? [Providesupportingcomments.] HomeCountrySupervision Arethepowersofthehomecountrysupervisoryauthority adequatetoenableeffectivesupervisionatheadoffice? To what extent does the home country authority exercise comprehensiveconsolidatedsupervision? [Providesupportingcomments.] ParentCompany,Affiliates,etc. Willthegroupstructureofthebankanditsrelationshipsto the parent, affiliates and other group entities support the abilityofMMAtoeffectivelysupervisethenewbank? [Providesupportingcomments.] GlobalOperations Is the global condition and performance of the applicant likelytohaveanadverseimpactonoperationsinMaldives? [Providesupportingcomments.] 10
10
10
10
10
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9 Branchvs.Subsidiary Arethereanyconstraintsorrequirementsoftheapplicant's homecountryregulatoronitsoperationsinMaldives? WilltheformofoperationsinMaldiveswillhelporhinder MMA'sabilitytoproperlysupervisethenewbank? [Providesupportingcomments.] InputfromOtherRegulators Haveotherregulatory orlawenforcementagencies,either domestically or abroad, offered compelling negative or positivecommentsabouttheapplicant? [Providesupportingcomments.] TOTALSCORE 10
10
10
100
EQUIVALENTTOTALSCORE(ifanyFactor'notapplicable')
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Maldives Application Guidelines For Banking and Financial Institution Licences 2009

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Maldives Application Guidelines For Banking and Financial Institution Licences 2009

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APPLICATIONGUIDELINES for BANKING&FINANCIALINSTITUTIONLICENCES

TheMMAmaybutisnotrequiredtograntalicenceifitissatisfiedthattheapplicationmeets specificcriteria.Primaryamongthesecriteriaarethefollowing i. Capital

5. Inquiries any inquiries concerning the preparation, documentation, required fees,orstatusofthisapplicationshouldbeaddressedtotheabove:

Address ________________________ ________________________ ________________________ ________________________ ________________________

Positiontobeheld ______________________ ______________________ ______________________ ______________________ ______________________

Rf______________ Rf______________ ______________ Rf______________

ProvidethelegalformoftheCS:(checkone) _____Corporation _____Partnership _____Other(specify____________________)

Address _____________ _____________ _____________ _____________

Title/PositioninCS __________________ __________________ __________________ __________________

%sharesowned ________ ________ ________ ________

CONFIDENTIALPERSONALFINANCIALSTATEMENT forsubmissionto MALDIVESMONETARYAUTHORITY

TOTALLIABILITIES vii. NETWORTH

ANNUALINCOME Salary Bonus&Commissions Dividends&Interest RealEstateIncome OtherIncome(Itemize)

CONTINGENTLIABILITIES AsEndorserorCoMaker OnLeasesorContracts LegalClaims ProvisionforIncomeTaxes OtherSpecialDebts(Itemize)

Outstanding Mortgages orLiens

Present Market Value

(Date)______________________________,20___ ________________________________________________________________________ (NameofConfirmingInstitution) (MailingAddress)

____________________________________________________ ____________________________________________________ TotheCEOoftheBankorFinancialInstitutionAddressed:

(j)Litigationapersonhasengagedorisexpectingtobeengagedinlitigationinthe Maldivesorelsewherewhichmayhaveamaterialadverseeffectontheresourcesofthe proposedbankoritspromoters.

(n)Taxesapersonhasnotsatisfiedallundisputedobligationsfortaxesthataredue andpayabletotheInternalRevenueCommissionoranyothertaxationauthorityinthe Maldivesorinanyotherjurisdiction.

(o)PoliticalOfficeapersonwhowillbeanadministratororamemberoftheboard ofdirectorsofabankisagovernmentofficialwhoheadsagovernmentministryorholds acabinetposition.

_____ _____ _____ _____ _____ _____ _____ _____ _____

Commercialandindustrialloans Mortgageloans(commercialandresidential) Installment/consumerloansandcreditcards Hirefinanceandequipmentleasing Exportimport/tradefinancing Foreignexchangedealer/broker Underwritingsecurities Managementadvisoryservices Other(specify)__________________________

Definitionoftargetmarketareas. Supportingmarketresearch,suchasareademographicsandeconomics. Identificationofmajorfactorsaffectingselectedmarketareas. Analysisofneedsfortargetmarketareas. Identificationandanalysisofcompetitionwithintargetmarketareas.

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Address

Positiontobeheld __

Rf Rf Rf

ProvidethelegalformoftheCS:(checkone) ___Corporation _Partnership _Other(specify__________________)

Address _______ _ _ _______

Title/PositioninCS

%sharesowned

(Date)____________________________,20_ ________________________________________________________________________ (NameofConfirmingInstitution) (MailingAddress)

TotheCEOoftheBankorFinancialInstitutionAddressed:

___ _ _ _ _ _ _ _ ___