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Bare acts > Banking Companies (Acquisition and Transfer of Undertakings) and Financial Institutions Laws (Amendment) Act, 2006 > Section 2
 
  


 

2. Amendment of section 3. - In section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (hereafter in this Chapter referred to as the Bank Nationalisation Act),-


(a) in sub-section (2B), for clause (c), the following shall be substituted, namely:-

"(c) such amounts as the Board of Directors of the corresponding new bank may, after consultation with the Reserve Bank and with the previous sanction of the Central Government, raise whether by public issue or preferential allotment or private placement, of equity shares or preference shares in accordance with the procedure as may be prescribed, so, however, that the Central Government shall, at all times hold not less than fifty-one per cent. of the paid-up capital consisting of equity shares of each corresponding new bank:

Provided that the issue of preference shares shall be in accordance with the guidelines framed by the Reserve Bank specifying the class of preference shares, the extent of issue of each class of such preference shares (whether perpetual or irredeemable or redeemable) and the terms and conditions subject to which, each class of preference shares may be issued.";

(b) in sub-sections (2BB) and (2BBA), for the words "raised by public issue", the words "raised by public issue or preferential allotment or private placement" shall be substituted;

(c) in sub-section (2C), for the words "raised by public issue", the words "raised from public by public issue or preferential allotment or private placement" shall be substituted;

(d) in sub-section (2E), the following provisos shall be inserted, namely:-

"Provided that the shareholder holding any preference share capital in the corresponding new bank shall, in respect of such capital, have a right to vote only on resolutions placed before such corresponding new bank which directly affects the rights attached to his preference shares: Provided further that no preference shareholder shall be entitled to exercise voting rights in respect of preference shares held by him in excess of one per cent. of the total voting rights of all the shareholders holding preference share capital only.".

 

 

 

 

 

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