Section 86B: Commercial Bank and Financial Institution Deemed to be Problematic

Bank shall declare any commercial bank or financial institution problematic by providing written notice to it when bank is convinced that the following conditions are prevailing in any commercial bank or financial institution on the basis of information received under Section 86A or from the report of inspection and supervision conducted under Section 84 or from any other means.

(a) In case any action against the interest of the depositors, shareholders, creditors, or the general public is evident,

(b) In case of non-fulfilment of any financial liabilities or not having the ability to do so, or non-payment of the due amount,

(c) In case of insolvency or going to be insolvent or facing material financial difficulties,

(d) In case of non-compliance with or breach of this Act, the prevailing law related to banks and financial institutions, other prevailing laws, terms of license or regulation, directives or orders of the bank,

(e) In case it is evident that the license has been obtained on the basis of submitting false, fraudulent, or wrong documents or data,

(f) In case of inability to maintain the capital fund as per this Act, the prevailing law related to banks and financial institutions and directives issued by the bank from time to time,

(g) In case of the initiation of legal proceedings for liquidation, resolution, or insolvency of any commercial bank or financial institution under the prevailing law,

(h) In case of undue delay in the process of voluntary liquidation, where such a proceeding has been initiated,

(i) For the commercial bank or financial institution established with the joint venture of the foreign commercial bank or financial institution, while such foreign commercial bank or financial institution is insolvent or liquidator is appointed for the liquidation or the license of such commercial bank or financial institution is terminated under the provision of the law of respective country or transaction is banned either fully or partially or where it is evident that operation of banking transaction is done in association with such commercial bank or financial institution, or

(j) If the bank is convinced that a commercial bank or financial institution is unable to pay its due or can have a negative effect on its liability or duties, which it has to perform.