27Investment of surplus funds

27 Investment of surplus funds

27 Investment of surplus funds

(1) Subject to subsection (2), a loan fund company may invest any of its funds that are not immediately required for the purpose of operating a loan fund scheme or for any purpose incidental to that purpose in:

(a) securities authorised by law for the investment of trust funds, or

(b) any securities, or any securities of a class, prescribed for the purposes of this paragraph.

(2) A loan fund company shall not invest any of the funds of the company referred to in subsection (1):

(a) in securities, by way of mortgage or charge, over real or leasehold property, or

(b) in securities that are not redeemable within a period of 3 years after the date of their acquisition by or on behalf of the company or, where some other period is prescribed, within the prescribed period.

Maximum penalty: 10 penalty units.

(3) Subsection (2) does not affect the validity of any investment of any of the funds of a loan fund company before it became a loan fund company, but on the redemption or disposal of any such investment, the company shall not re-invest the proceeds from the redemption or disposal in contravention of that subsection or in contravention of section 28.

s 27: Am 1982 No 58, Sch 1 (2); 1992 No 112, Sch 1.