This is in line with COBAC Regulation R-2018/04 laying down the procedures for obtaining approval as a credit institution by subsidiaries, opened under the single approval regime, of a credit institution whose approval has been withdrawn.
In accordance with the provisions of paragraph 2 of article 81 of regulation no. 02/14/CEMAC/UMAC/COBAC/CM on the treatment of credit institutions in difficulty in the CEMAC, the present regulation lays down the procedures for obtaining authorization as a credit institution by subsidiaries, opened under the single authorization system, of a credit institution whose prudential authorization has been withdrawn.
The subsidiaries referred to in the previous paragraph are credit institutions established in a CEMAC country in application of the provisions of article 5 paragraph 2 of regulation no. 01/00/CEMAC/UMAC/COBAC establishing a single license for credit institutions in the CEMAC.
Within six (06) months of notification of the withdrawal of the parent company’s prudential approval as a credit institution in the CEMAC, the subsidiary referred to above submits an application for approval to the Monetary Authority of the country in which it is established. Once this deadline has passed, COBAC will automatically automatic withdrawal of the establishment’s authorization.
Once this period has elapsed, COBAC automatically withdraw the authorization of the establishment.
The application for approval is examined in accordance with the provisions of the regulation No. 02/15/CEMAC/UMAC/COBAC amending and supplementing certain conditions relating to the exercise of the banking profession in CEMAC and regulation No. COBAC R-2016/01 relating to the conditions and procedures for issuing of authorizations for credit institutions, their directors and auditors, subject to the provisions of these regulations.
The authorization applied for may only be granted if the parent company in liquidation referred to;
– No longer holds any interest in the applicant’s capital;
– Has concluded one or more notarized agreements for the sale of its holdings/shareholdings.
In the context of the liquidation of a credit institution, the acquisition of shareholdings held by this credit institution, the parent company, in its subsidiaries established in the CEMAC under the single authorization regime, is subject to the prior authorization of COBAC under the conditions set by the regulation COBAC R-2016/02 relating to changes in the credit institutions. For the application of this article, the significant shareholding threshold set by the aforementioned COBAC regulation in this respect, any transfer of shares must be authorized in advance.
Where COBAC has not ruled on the application for prior authorization at the time of when the application for authorization referred to in Article 2 above is submitted, the granting or refusal of authorization by the Monetary Authority shall be deemed to constitute a decision authorization or refusal of prior authorization.
The subsidiary continues to operate on the basis of the authorization issued pursuant to article 5 paragraph 2 of the regulation No. 01/00/CEMAC/UMAC/COBAC, until authorization is granted or refused by the Monetary Authority. During this period, COBAC may impose limitations on the exercise of the credit institution’s activities.
The granting or refusal of authorization as a bank or financial institution automatically entails the withdrawal of the authorization.
In the event of refusal of authorization by the Monetary Authority, COBAC shall appoint a bank liquidator who shall windup the institution in accordance with the provisions of the regulations No. 02/14/CEMAC/UMAC /COBAC/CM relating to the treatment of credit institutions in difficulty in the CEMAC region.