prohibiting foreign ownership above 40 percent in a local company was tabled in Parliament yesterday.

Finance Minister Grant Gibbons, while not openly supporting the grant of exemption, said he believes the bank has a good argument for not having the 60/40 rule applied to it.

He said it was "inappropriate'' for him to comment until the House's private bill committee had studied the bill and made a recommendation.

"I think they (Bank of Bermuda) have a good business case and they have circumstances which make it rational to make a submission to the private bills committee,'' Dr. Gibbons said yesterday in a telephone interview.

The bank is arguing that a secondary listing would allow it to continue to grow and give it access to the capital needed for growth. The Bank of Bermuda is currently listed only on the Bermuda Stock Exchange.

The bank is seeking to get an exemption as a necessary step to a secondary listing on the Nasdaq stock exchange.

The bank also argues Bermuda's current ownership rules provides no protection from foreign control of the bank. Control could be bought by owning between 15 to 20 percent of the shares.

Other rules the bank has in place and which are included in the private members bill would be better protection from any takeover attempt, Chairman Eldon Trimingham, and president and chief executive officer Henry Smith jointly explained in a recent letter to shareholders.

The bill would mandate that at least 60 percent of the board members remain Bermudian, and would restrict individual ownership to a maximum of ten percent. The bank stated the secondary listing would also help increase the price of the stock, which it believes is currently undervalued.

Dr. Gibbons said the bank is in the position of being both a local company and of earning over 50 percent of its revenue overseas.

"I understand exactly why the bank feels they have good business reasons for putting this particular bill forward,'' he said. "They are in a fairly special situation. Not many companies operate both locally and internationally. In some respects you have a special situation.'' He said the three local banks are facing increasing competition internationally from companies which do not have to contend with protective measures such as the 60/40 rule.

The bank is arguing for exemption based on the fact that 57 percent of its $300 million in annual revenue comes from its 17 overseas offices. Meanwhile, corporate and private client business generates 80 percent of its revenues, while retail and other business generates the rest.

The Bank of Bermuda has about 6,000 shareholders of which about 80 percent are Bermudian. The bank employs 2,325 employees of which 51 percent are based on the Island.

PLP Shadow Finance Minister Eugene Cox said he and his party had not read the bill yet, although it had been gazetted two weeks ago. Mr. Cox said he would be studying the bill over the next week after the budget debate is completed.