RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of June 8, 2017 No. 2017-P-12/23-8-(NPA)

About approval of the Provision "About Temporary Administration"

According to articles 7 and 43 of the Law "About National Bank of the Kyrgyz Republic" Board of National Bank of the Kyrgyz Republic decides:

1. Approve the Provision "About Temporary Administration" it (is applied).

2. Recognize invalid:

- the resolution of Board of National Bank of the Kyrgyz Republic "About the Provision "About the Temporary Control Directive Bank" of September 30, 2008 No. 36/5;

- Items 11 and 12 of Appendix to the resolution of Board of National Bank of the Kyrgyz Republic "About modification and amendments in some regulatory legal acts of National Bank of the Kyrgyz Republic" of April 25, 2012 No. 18/9;

- Items I and II of Appendix to the resolution of Board of National Bank of the Kyrgyz Republic "About entering of amendments into some regulatory legal acts of National Bank of the Kyrgyz Republic" of July 4, 2012 No. 28/9;

- Items 11 and 21 of Appendix to the resolution of Board of National Bank of the Kyrgyz Republic "About modification and amendments in some regulatory legal acts of National Bank of the Kyrgyz Republic" of November 16, 2012 No. 43/1;

- the paragraph the sixteenth Item 1 of the resolution of Board of National Bank of the Kyrgyz Republic "About modification and amendments in some resolutions of Board of National Bank of the Kyrgyz Republic" of February 10, 2016 No. 7/2 and Item 15 of Appendix to the specified resolution;

- the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Preservation of the Commercial Banks and Microfinance Companies Attracting Deposits" of September 23, 2009 No. 38/3;

- the paragraph of the sixth of Item 1 of the resolution of Board of National Bank of the Kyrgyz Republic "About modification and amendments in some resolutions of Board of National Bank of the Kyrgyz Republic" of November 27, 2014 No. 53/8 and Item 5 of Appendix to the specified resolution;

- the resolution of Board of National Bank of the Kyrgyz Republic "About the Provision "About Temporary Administration on Management of Credit Unions" of June 5, 2000 No. 22/9.

3. To legal management:

- publish this resolution on the official site of National Bank of the Kyrgyz Republic;

- after official publication to send this resolution to the Ministry of Justice of the Kyrgyz Republic for entering into the State register of regulatory legal acts of the Kyrgyz Republic.

4. This resolution becomes effective on June 22, 2017.

5. To management of methodology of supervision and licensing to bring this resolution to the attention of commercial banks, National bank of development of the Kyrgyz Republic, OYuL "Union of Banks of Kyrgyzstan", specialized financial credit institute JSC Finance Company of Credit Unions, the microfinancial organizations, credit unions attracting deposits, regional managements and representative office of National Bank of the Kyrgyz Republic in Batken Province.

6. To impose control of execution of this resolution on the board member of National Bank of the Kyrgyz Republic Dzhusupova T.Dzh.

Regulations on Temporary administration

Chapter 1. General provisions

1. This Provision determines the bases, procedure, procedures of introduction and implementation of Temporary administration and implementation in the period of Temporary administration of restructuring of commercial banks, the microfinancial organizations attracting deposits, JSC Finance Company of Credit Unions, the credit unions attracting deposits, including performing transactions according to the Islamic principles of banking and financing or having "Islamic window", the housing and savings credit companies, credit bureaus taking into account the special terminology applied by them in case of banking operations (further - banks), and also the payment organizations / operators of payment systems (further - PO/OPS). At the same time procedures of restructuring are not applied to credit unions and PO/OPS.

This Provision is applied to credit unions and PO/OPS taking into account features of their activities according to the legislation of the Kyrgyz Republic.

2. In this Provision the determinations stated in the laws of the Kyrgyz Republic "About banks and banking activity" and "About payment system of the Kyrgyz Republic" and also the following concepts are used:

The temporary administration is entered by National Bank of the Kyrgyz Republic (further - National Bank) as corrective action for the purpose of establishment of control over:

- bank for ensuring safety of assets, documents and information, protection of the rights and legitimate interests of investors and other creditors of bank, ensuring stability and safety of bank system of the Kyrgyz Republic, and also establishment of the real situation in bank and determinations of its further activities;

- PO/OPS for protection of the rights and legitimate interests of users of payment systems, maintenance and ensuring efficiency, safety and reliability of payment systems, and also establishment of the real situation in PO/OPS and determinations of its further activities.

The temporary administrator - person designated by National Bank the temporary administrator or the head of temporary administration for the purpose of implementation of the mode of temporary administration in bank/PO/OPS.

Counteraction of Temporary administration - action or failure to act of governing bodies and/or certain officials and employees of bank/PO/OPS (branch / subsidiary company) and other, tied with bank/PO/OPS faces interfering or causing impossibility of accomplishment by the temporary administrator or heads/members of temporary administration of the functions determined by the Law of the Kyrgyz Republic "About banks and banking activity" and this Provision.

The act of counteraction to implementation of Temporary administration - the document which is constituted on each fact of counteraction of governing bodies and/or certain officials and/or employees of bank/PO/OPS (branch / subsidiary company) and other, tied with bank/PO/OPS faces, to implementation of Temporary administration.

Supervision body - structural divisions of National Bank, Committee on supervision of National Bank (further - Committee on supervision), Committee on payment system of National Bank (further - Committee on payment system), provided by organizational structure of National Bank.

Restructuring of bank - package of measures, the undertaken concerning bank for the purpose of depositor protection and other creditors, preserving continuity systemically important for bank or payment system of functions of bank, and also ensuring stability of bank and financial system.

Chapter 2. Introduction of Temporary administration

3. The temporary administration is entered into bank/PO/OPS in the presence of the bases specified in the Law of the Kyrgyz Republic "About banks and banking activity" and also regulatory legal acts of National Bank.

4. The decision on introduction of Temporary administration and appointment of the Temporary administrator / head of Temporary administration is accepted by Board of National Bank (further - Board) / Committee on supervision/committee on payment system of National Bank on the petition of supervision body.

The decision of Board/committee on supervision/committee on payment system of National Bank about introduction of Temporary administration and appointment of the Temporary administrator / head of Temporary administration is drawn up by the resolution and becomes effective from the moment of its acceptance if other is not provided in the resolution.

5. The decision on introduction of Temporary administration and appointment of the Temporary administrator / head of Temporary administration can be accepted Board/committee on supervision/committee on payment system of National Bank on the statement of Board, the Board of directors, creditors and shareholders of bank, members of executive body and/or shareholders (founders)/participants of PO/OPS, and also according to the appeal of law enforcement, judicial and other authorized state bodies in which the bases for appointment of Temporary administration shall be specified.

6. If introduction of Temporary administration is initiated by persons specified in Item 5 of this provision they shall provide the following documents in case of the appeal to National Bank:

- the statement for default bank of accounts payable during the next 5 (five) working days after maturity or about availability of other bases for introduction of Temporary administration, according to the legislation of the Kyrgyz Republic;

- the statement for non-execution of PO/OPS of financial liabilities before participants and/or users of payment system and/or inability of repayment of obligations during the next 5 (five) working days after approach of term of implementation of calculations, or about availability of other bases for introduction of Temporary administration, according to the legislation of the Kyrgyz Republic;

- reasons for need of introduction of Temporary administration for bank/PO/OPS with reference to the corresponding regulatory legal acts and appendix of supporting documents.

The supervision body considers the specified documents within 20 (twenty) working days and in case of justification and need of introduction of Temporary administration, based on the submitted documents submits the petition for consideration of Board/committee on supervision/committee on payment system of National Bank for decision making.

7. The petition for introduction of Temporary administration shall contain in bank/PO/OPS:

- data on bank, branches, savings banks, subsidiary and dependent companies, structure of banking group (when applicable) or data on PO/OPS, subsidiary and dependent companies (when applicable);

- reasons for appointment of Temporary administration;

- data on financial condition of bank/PO/OPS (including results of the last complex and target checks);

- offer on effective period of Temporary administration, but no more than 6 (six) months;

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