ADVOKS GLOBAL · KENYA
Building Societies Act
55A. Application for transfer of business to a company
Edition: 2022-12-31 · In force
55A. Application for transfer of business to a company
(1)Where a building society wishes to transfer its business including all its assets and liabilities, to a limited liability company incorporated under the Companies Act (Cap. 486), such building society may make an application to the Cabinet Secretary responsible for finance through the Central Bank in the prescribed manner.(2)An application under subsection (1) shall be supported by—(a)a report signed by all directors outlining the reasons for seeking to undertake such transfer;(b)a resolution approved by the creditors of the society sanctioning the intended transfer;(c)a special resolution approved by three-quarters of the members of the society sanctioning the intended transfer;(d)audited statements of accounts confirming that the society is solvent and has carried on its business in conformity within the provisions of the Act and the society’s by-laws and regulations;(e)a resolution approved by the annual or extraordinary general meeting of the limited company to which the transfer is intended to be made stating that the company is financially able to satisfy on demand the claims of all creditors of the society;(f)full disclosure of the shareholders and directors of the company including information on their interests in the company;(g)a copy of the company’s memorandum and articles of association; and(h)a copy of the company’s latest audited statements of accounts.(2A)The Central Bank shall examine every application made under subsection (1) and shall forward the application, together with its recommendations thereon, to the Cabinet Secretary responsible for finance.(3)In considering an application made by a society under subsection (1) the Cabinet Secretary responsible for finance shall ensure that—(a)the intended transfer is in good faith for the benefit of the members of the building society, its creditors and the general public;(b)the company carries on or is licensed to carry on the business of an institution under the Banking Act (Cap. 488);(c)the company and the society are financially solvent and the company is capable of assuming the society’s business without adversely affecting any member, creditor, borrower or other interested party.(4)Where the Cabinet Secretary responsible for finance is satisfied that the intended transfer fulfils the conditions set out in subsection (3), the Cabinet Secretary responsible for finance shall cause the building society to publish a notice in the Gazette and in at least one national daily newspaper informing the public of the intended transfer and inviting any interested party with objections thereto to appear and make representations to the Cabinet Secretary responsible for finance at a specific venue within a period not exceeding thirty (30) days.(5)The Cabinet Secretary responsible for finance may, after hearing all representations under subsection (4), approve or reject the application.