|
Article 4
|
To engage in the lending of book-entry central government bonds, the securities firm must satisfy the eligibility criteria and submit a proper application along with relevant supporting documents to the authority.
For securities firms that are part of the Contract for Use of the Centralized Securities Exchange Market, all matters requiring prior approval in connection with the business activity described in the preceding Paragraph shall be forwarded to the competent authority through TSEC. Securities firms that are part of the Contract for Trading Securities on the Over-the-Counter Market may have their applications forwarded to the competent authority through TPEx.
Securities firms that have been authorized by the competent authority to lend book-entry central government bonds are required to submit the following documents to TPEx two days before commencing:
- A photocopy of the approval document issued by the competent authority.
- A list managers and officers who will be involved in the lending of book-entry central government bonds, supported by valid eligibility proofs.
The abovementioned managers and officers must also be registered as practitioners before commencing business activities. Any changes to the roles of these personnel must be updated to the registry within 5 days.
Securities firms that have been authorized by the competent authority to lend book-entry central government bonds are required to register this new business activity at the appropriate institution before commencing. In addition, all personnel involved in the lending of book-entry central government bonds must satisfy the eligibility stipulated in "Regulations Governing Responsible Persons and Associated Persons of Securities Firms".
Securities firm approved by the competent authority to lend book-entry central government bonds will be mandated to suspend all lending activities except returning transactions, if the firm's capital adequacy ratio falls below 200% for two consecutive months, whether or not the firm has commenced lending since approval. Securities firms that are suspended from lending due to the above may only resume activities after having satisfied the capital adequacy requirement for three consecutive months, subject to the approval of the competent authority. Those that are approved but have yet to commence lending activities must cease immediately.
|