| (1) | An application under section 52(2) of the Act for the permission, in terms of section 52(1) of the Act, of the Registrar for the acquisition or establishment of subsidiaries, joint ventures, branch offices, divisions, other interests and representative offices of banks or controlling companies shall be submitted to the Registrar. |
| (2) | An application, in writing, under subregulation (1) for the acquisition or establishment of— |
| (a) | a local subsidiary or local joint venture shall contain the following information: |
| (ii) | name of interest to be acquired or established, together with the name of the said interest's external auditors and its financial year-end; |
| (iii) | brief reasons for the acquisition or establishment; |
| (iv) | key features of the transaction, for example, shareholding and control, purchase price, price exposure to loss, acquisition costs as a percentage of capital and reserve funds of applicant, size of the subsidiary in relation to the bank and/or banking group; |
| (v) | main activities to be conducted; |
| (vi) | proposed date of disposal if acquired as security for an advance or loan granted; |
| (vii) | details of the management of the proposed subsidiary or proposed joint venture, including— |
| (A) | names and experience of key personnel; |
| (B) | impact that management of the subsidiary or joint venture will have on management of the bank and/or banking group, for example, the extent to which current management will be deployed or additional human resources will be required; |
| (viii) | any other relevant information; |
| (A) | the entity will not establish or acquire any other entities without the prior written approval of the Registrar; |
| (B) | the Registrar will be advised timeously of the disposal of the entity by the applicant; |
| (C) | a detailed organogram reflecting all interests under the bank or controlling company shall be furnished to the Registrar on 31 March and 30 September of each year, or in the event of any major change in the group structure, shall be furnished to the Registrar within 30 days of the aforementioned dates or such change; |
| (x) | whether the transaction will materially influence the financial and risk position of the bank and, if this is the case, a copy of the due diligence report compiled by the external auditors and/or internal staff; or |
| (b) | an interest outside the Republic, including a subsidiary, joint venture, branch office or representative office, shall contain the following additional information: |
[Words preceding regulation 56(2)(b)(i) substituted by regulation 25 of Notice No. 297, GG 40002, dated 20 May 2016]
| (i) | 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) | copy of the business plan; |
| (v) | whether the Financial Surveillance Department of the Reserve Bank has been approached; |
| (vi) | copies of all relevant documentation; |
| (vii) | impact of acquisition or formation on bank or controlling company regarding— |
| (D) | undertakings required of a local institution by foreign authorities; |
| (E) | contagion potential; and |
| (viii) | particulars of the directors, names, nationalities and curricula vitae, together with completed forms BA 020, as prescribed in regulation 42; |
| (ix) | name and curriculum vitae of chief executive officer, together with a completed form BA 020, as prescribed in regulation 42; |
| (x) | names, experience and nationalities of top management, together with completed forms BA 020, as prescribed in regulation 42. The impact that management of the subsidiary or joint venture will have on management of the bank and/or banking group, for example, the extent to which current management will be deployed or additional human resources will be required; |
| (xi) | under a heading 'Group Structure'— |
| (A) | direct and indirect shareholding; and |
| (B) | detailed organisational chart, also reflecting "front" companies/ structures; |
| (xii) | the following details regarding the host country— |
| (A) | whether or not exchange control is applicable; |
| (B) | whether approval has been obtained from the host country (supported by relevant documentation); |
| (C) | nature of supervisory functions performed by host country; and |
| (D) | evaluation of country risk in respect of the host country; |
| (xiii) | financial analysis, if acquisition, that is— |
| (D) | relevant ratio analysis; |
| (F) | other relevant details; |
| (xiv) | business conducted or proposed to be conducted, including— |
| (A) | details of how the business will be funded; |
| (B) | nature of the business to be conducted; |
| (C) | main sources of income; |
| (E) | classification of the business as principal and/or agent; and |
| (xv) | an opinion on the ability of the company to submit the required BA returns. |
| (c) | a division shall contain the following information: |
| (ii) | name of division to be acquired or established; |
| (iii) | brief reasons for the acquisition or establishment; |
| (iv) | key features of the transaction, for example, shareholding and control, purchase price, price exposure to loss, acquisition costs as a percentage of capital and reserve funds of applicant, size of the division in relation to the bank and/or banking group; |
| (v) | main activities to be conducted; |
| (vi) | details of the management of the proposed division, including— |
| (A) | names and experience of key personnel; |
| (B) | impact that management of the division will have on management of the bank and/or banking group, for example, the extent to which current management will be deployed or additional human resources will be required; |
| (vii) | any other relevant information; |
| (viii) | undertakings that the Registrar will be advised timeously of the disposal of the division by the applicant; |
| (ix) | whether the transaction will materially influence the financial and risk position of the bank and, if this is the case, a copy of the due diligence report compiled by the external auditors and/or internal staff. |
