A group finance company is an entity that takes repayable funds by issuing securities and that lends the takenfunds within the group to which it belongs.
An exception to the prohibition to pursue the business of a bank without a licence may apply if a group finance company holds an unconditional guarantee from a licensed bank or from its own parent company with respect to all obligations arising from the repayable funds received. The group finance company must grant at least 95% of those funds as credits within the group to which it belongs. The parent company is required to guarantee that the group finance company is able to fulfil at all times all of its obligations arising from having taken repayable funds. The parent company is also required to have positive consolidated own funds at its disposal during the entire life of the guarantee.
The group finance company is only excepted from the obligation to have a licence if it is at all times able to demonstrate that it complies with the conditions for exception.