Section 47
Deposits of member institution acquired by non-member institution
(1)
Where deposits with a member institution are acquired by a person who is not a member institution, such deposits are deemed to be and continue to be protected by the deposit up to the limit of $50,000 for the remainder of the assessment year, or upon maturity or until withdrawal, whichever is earlier, after the acquisition of the deposits by the acquiring non-member institution.
(2)
For the purposes of subsection (1), and in accordance with such regulations as may be prescribed —
(a)
in relation to the depositors, the member institution shall —
Deposit Protection
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(i)
obtain written consent of at least 75 per cent of all the depositors or their personal representatives to transfer deposits;
(ii)
obtain written acknowledgement of each depositor that the depositor is aware that deposits transferred to the non-member institution will remain protected deposits for the remainder of the assessment year, or upon maturity or until withdrawal, whichever is earlier, the deposits placed with the amalgamated non-member institution shall no longer be protected deposits in whole or in part by the Corporation;
(iii)
upon a request in writing, pay to a depositor, the principal amount of the deposit and return thereon, calculated to the date of withdrawal and no charge or penalty shall be imposed in respect of the payment;
and
(iv)
provide a statement that the acquired member institution’s obligation to repay deposits will be assumed by the non-member institution; and
(b)
in relation to the acquiring non-member institution, enter into an agreement in writing to assume the acquired member institution’s liability in relation to the deposits on the same terms and conditions.
(3)
For the purpose of subsection (2)(b), the member institution shall indemnify the Corporation in the event of any payment made by the
Corporation to depositors, in respect of such of its deposits as have been transferred or acquired by the acquiring non-member institution.