2.5.7 Requirements Relating to Preference Shares, Unsecured Loans and Others for General Trading Members

Past version: Effective up to 31 Mar 2014

The following additional financial requirements apply to General Trading Members:

(a) a General Trading Member shall comply with the obligations under the Financial and Margin Regulations relating to the issue of any preference share and redemption of any redeemable preference share, drawing down and repayment in part or in full of any Qualifying Subordinated Loan principal, making of any unsecured loan or advance, payment of any dividend or director's fees or increase in any director's remuneration, with the additional condition that in relation to the redemption of any redeemable preference share, repayment in part or in full of any Qualifying Subordinated Loan principal, making of any unsecured loan or advance, payment of any dividend or director's fees or increase in any director's remuneration, a General Trading Member shall ensure that the sum of its Financial Resources or Adjusted Net Head Office Funds, as the case may be, and Qualifying Letters of Credit referred to in Rule 2.5.5, are more than 150% of its Total Risk Requirement. For the avoidance of doubt, a General Trading Member shall comply with the requirements described in the relevant provisions of the Financial and Margin Regulations referred to in this Rule 2.5.7(a), whether or not that Member is licensed under the Act; and
(b) a General Trading Member shall not reduce its paid-up ordinary share capital without the prior written approval of the Exchange.

Amended on 25 August 200925 August 2009.