| (1) | An application under section 41 of the Act, for the permission, for the acquisition or establishment of subsidiaries, branch offices, other interests and representative offices of mutual banks shall be submitted to the Authority. |
| (2) | An application, in writing, under subregulation (1) for the acquisition or establishment of: |
| (a) | a local subsidiary, branch office, other interest, and representative office, shall contain the following information: |
| (ii) | name of interest to be acquired or established; |
| (iii) | brief reasons for the acquisition or formation; |
| (iv) | key features of the transaction, for example, shareholding and control, price exposure to loss, acquisition costs as a percentage of capital and reserves of applicant; |
| (v) | main activities to be conducted; |
| (vi) | proposed date of disposal if acquired as security for an advance or loan granted; |
| (vii) | any other relevant information. |
| (AA) | the entity will not establish or acquire any other entities without the prior written approval of the Authority. |
| (BB) | the Authority will be advised timeously of the disposal by the applicant. |
| (CC) | a detailed organogram reflecting all interests under the bank or controlling company shall be furnished to the Authority of Banks on 31 March and 30 September of each year; or |
| (b) | an off-shore subsidiary, branch office, representative office and other interests shall contain the following additional information, namely— |
| (i) | the advantages to the applicant and South Africa; |
| (ii) | details of transaction, such as the ultimate identity of the seller, purchase price, form of payment and effective date; |
| (iii) | In the event of an acquisition, a copy of the due diligence report compiled by the external auditors and/or internal staff; |
(iv) a copy of the business plan;
| (v) | whether the Exchange Control Department of the S A Reserve Bank has been approached; |
| (vi) | copies of all relevant documentation; |
| (vii) | impact of acquisition or formation on mutual bank regarding |
| (CC) | overall risk profile; |
| (DD) | undertakings required of local institution by foreign authorities; |
| (viii) | particulars of the directors, names, nationalities and curriculum vitae together with completed form DI 020 as prescribed in regulation 39; |
| (ix) | name and curriculum vitae of chief executive officer, together with completed forms DI 020 as prescribed in regulation 39; |
| (x) | names, experience and nationalities of top management, together with completed form DI 020 as prescribed in regulation 39; |
| (xi) | under a heading 'Group Structure' |
| (AA) | direct and indirect shareholding; |
| (BB) | detailed organizational chart also reflecting "front" companies/structures; |
| (xii) | the following details regarding the host country |
| (AA) | exchange-control applicable; |
| (BB) | whether approval has been obtained from the host country (supported by documentation); |
| (CC) | nature of supervisory functions performed by host country; and |
| (DD) | evaluation of country risk in respect of host country; |
| (xiii) | financial analysis, if acquisition |
| (EE) | capital adequacy; and |
| (FF) | other relevant details; |
| (xiv) | business conducted or proposed to be conducted - |
| (AA) | details of how business will be funded; |
| (BB) | nature of business to be conducted; |
| (CC) | main sources of income; |
| (EE) | classification of business as principal and/or agent; and |
| (xv) | an opinion on the ability of the company to submit the required DI returns. |
