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Markets in Financial Instruments and Miscellaneous Provisions Act 2007

Amendment to section 35 of Credit Union Act 1997.

17.— Section 35 of the Credit Union Act 1997 is amended by substituting the following for subsection (2):

“(2) A credit union shall not make a loan to a member—

(a) for a period exceeding 5 years if, were the loan to be made, the total gross amount outstanding in respect of all loans with greater than 5 years to the final repayment date would then exceed 20 per cent of the total gross loan book balance outstanding at that time in respect of all loans made by the credit union, or 40 per cent of the total gross loan book balance outstanding at that time in respect of all loans made by the credit union where written approval is received from the Bank,

(b) for a period exceeding 10 years if, were the loan to be made, the total gross amount outstanding in respect of all loans with greater than 10 years to the final repayment date would then exceed 10 per cent of the total gross loan book balance outstanding at that time in respect of all loans made by the credit union, or 15 per cent of the total gross loan book balance outstanding at that time in respect of all loans made by the credit union where written approval is received from the Bank, or

(c) in the circumstances specified in subsection (3),

and, for the purposes of this subsection, the ‘ final repayment date’ for a loan shall be—

(i) the date on which the loan is due to expire, as indicated on the relevant credit agreement in accordance with section 37C(1)(j), or

(ii) any subsequent date agreed between the credit union and the member to whom the loan has been made.”.