Federal Law, Banks And Savings Banks, Section VIII, Pledge Contracts

Section VIII - Pledge Contracts

Art. 17

1. A bank that wants to reserve itself the right to re-pledge or to give a pledge as replacement, must be authorised by the pledgor in a special deed.

2. The bank may not re-pledge or give the pledge as replacement for an amount exceeding its own claim against the pledgor. The bank must ascertain that no other rights exceeding that amount accrue in favour of third persons.

Prepared by: M. J. Wharton.

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