RESOLUTION OF BOARD OF THE NATIONAL BANK OF UKRAINE

of November 7, 2019 No. 132

About approval of Changes in some regulatory legal acts of the National Bank of Ukraine

According to Articles 7, of 15, of 55, of 56, 58 Laws of Ukraine "About the National Bank of Ukraine", to Articles 35, of 44, of 49, 66 Laws of Ukraine "About banks and banking activity", for the purpose of enhancement of regulation of activities of banks of Ukraine and procedure for determination by banks of Ukraine for the extent of credit risk on active banking activities the Board of the National Bank of Ukraine DECIDES:

1. Approve Changes in the Instruction about procedure for regulation of activities of banks in Ukraine approved by the resolution of Board of the National Bank of Ukraine of August 28, 2001 No. 368, registered in the Ministry of Justice of Ukraine on September 26, 2001 for No. 841/6032 (with changes) which are applied.

2. Bring in the resolution of Board of the National Bank of Ukraine of June 30, 2016 No. 351 "About approval of the Regulations on determination by banks of Ukraine of the extent of credit risk on active banking activities" (with changes) the following changes:

1) in Item 5-2:

 in paragraph one of figure "2020" to replace with figures "2021";

add Item with the new subitem of such content:

"3) during determination of class of debtor bank based on assessment of financial condition not to apply regulation of subitem 1-1 of Item 82 and Item 85 of the Section VI of the Regulations on determination of the extent of credit risk regarding observance of economic standard rates by debtor bank (except standard rates of H7 and H9) established by National Bank.";

The resolution after Item 5-2 to add 2) with new Item 5-3 of such content:

"5-3. During application of the Regulations on determination of the extent of credit risk to allow banks of Ukraine till January 01, 2022 during determination of class of debtor bank based on assessment of its financial condition not to apply regulation of the subitem 1 of Item 82 and Item 85 of the Section VI of the Regulations on determination of the extent of credit risk regarding observance by debtor bank of economic standard rates of H7 and H9, established by National Bank.".

3. Approve Changes in the Regulations on determination by banks of Ukraine of the extent of credit risk on active banking activities approved by the resolution of Board of the National Bank of Ukraine of June 30, 2016 No. 351 (with changes) (further - Changes in the Provision) which are applied.

4. To department of methodology (Natalya Ivanenko) after official publication to inform banks information on adoption of this resolution.

5. To impose control of execution of this resolution on the First Deputy Chairman of the National Bank of Ukraine Ekaterina Rozhkova.

6. The resolution becomes effective from the date of, its official publication following behind day, except:

1) Items 1, 3 presents of the resolution which become effective since December 28, 2019;

2) the subitem 1 of Item 8 of Changes in the Provision which becomes effective since January 1, 2021.

Approved by the Resolution of Board of the National Bank of Ukraine of November 7, 2019 No. 132

Changes in the Instruction about procedure for regulation of activities of banks in Ukraine

1. The twenty first the Section I to state the paragraph in the following edition:

"The bank when calculating economic standard rates uses the credit ratings of debtor/partner/asset on the international scale determined by rating agencies "Standard&poor" s ", " Moody "s Investors Service", "Fitch Ratings" taking into account Item 38 of the Section II of Provisions on determination by banks of Ukraine of the extent of the credit risk on active banking activities approved by the resolution of Board of the National Bank of Ukraine of June 30, 2016 No. 351 (with changes) (further - No. Provision 351)".

2. " Item 1.8 of Chapter 1 of the Section II to state the subitem "g" in the following edition:

"") book value of extra listing securities (except the securities emitted by the central executive bodies, National Bank, the Public mortgage institution and local government bodies of Ukraine) which are carried at fair value;".

3. In the subitem 2 of Item 5 of Chapter 9 of the Section III of figure "1.4" to replace with figures "1.5".

4. In the Section IV:

1) in Chapter 1:

in Item 1.3:

in the subitem "a":

the fifth to state the paragraph in the following edition:

"the debt securities of the central executive bodies of Ukraine emitted in national currency (hryvnia);";

 to add the paragraph of the sixth with words ", the European Investment Bank, the European investment fund;";

 to state the paragraph of the eighth in the following edition:

"the securities emitted by the central executive bodies of the countries having credit rating on the international scale it is not lower than the AA-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Aa3 rating agency on classification of rating agency of "Moody" of s Investors Service ";";

 state the subitem "v" in the following edition:

"c) III group of assets with risk degree of 20 percent:

the debt securities of local government bodies of Ukraine emitted in national currency (hryvnia);

the means poste restante placed in the banks having credit rating on the international scale it is not lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

deposits overnight and other short-term deposits which are placed in the banks having credit rating on the international scale are not lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the credits the overdraft, overnight and other short-term loans which are placed in the banks having credit rating on the international scale is not lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

currency and bank metals to obtaining on transactions spot with banks partners which have credit rating on the international scale not lower than the VVV-level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the securities emitted by the central executive bodies of the countries having credit rating on the international scale it is not lower than the And — level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level A3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the securities emitted by local government bodies of the countries having credit rating on the international scale it is not lower than the AA-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Aa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the securities emitted by subjects of managing which have credit rating on the international scale not lower than the AA-level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level Aa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the debt securities emitted by banks which have credit rating on the international scale not lower than the AA-level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level Aa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

imputed incomes which payment due date according to the agreement did not expire, on the assets carried to this group of assets;";

  to add Item after the subitem "v" with the new subitem "g" of the following content:

"d) The IV group of assets with risk degree of 30 percent:

the debt securities emitted by banks which have credit rating on the international scale not lower than the And — level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level A3 rating agency on classification of rating agency of "Moody" of s Investors Service";

imputed incomes which payment due date according to the agreement did not expire, on the assets carried to this group of assets;".

With respect thereto subitems "g", "ґ", "д" to consider respectively subitems "ґ", "д", "е";

in paragraph one of the subitem "g"" to replace figures "IV" with figure "V";

in the subitem "d":

in paragraph one to replace figure "V" with figures "VI";

paragraphs two, third to state in the following edition:

"means poste restante in banks which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the deposits overnight placed in banks which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service ";";

paragraphs the ninth, tenth to state in the following edition:

"the currency and bank metals to obtaining on transactions spot with banks partners which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the loans overnight granted to banks which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service ";";

to add the subitem after the paragraph of the fourteenth with four new paragraphs the fifteenth - the eighteenth the following content:

"the securities emitted by the central executive bodies of the countries having credit rating on the international scale it is not lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the securities emitted by local government bodies of the countries having credit rating on the international scale it is not lower than the And — level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level A3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the securities emitted by the subjects of managing having credit rating on the international scale it is not lower than the And — level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level A3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the debt securities emitted by banks which have credit rating on the international scale not lower than the VVV-level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service ";";

to add Item after the subitem "d" with the new subitem "e" of the following content:

"e) The VII group of assets with risk degree of 75 percent:

the securities emitted by the subjects of managing having credit rating on the international scale it is not lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

imputed incomes which payment due date according to the agreement did not expire, on the assets carried to this group of assets;".

With respect thereto to consider the subitem "e" the subitem "є";

in the subitem "є":

in paragraph one of figure "VI" to replace with figures "VIII";

state paragraph two in the following edition:

"short-term deposits (deposits) placed in banks which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service";

the fifth to state the paragraph in the following edition:

"the credits the overdraft, means on transactions repo and other short-term loans granted to banks which have no credit rating or have credit rating on the international scale, it is lower than the VVV-level on classification of rating agency "Standard&poor" of s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service;";

the twelfth to state the paragraph in the following edition:

"the securities which are not included in subitems "a", "v", "g", "d", "e" of Item 1.3 of Chapter 1 of the Section IV of this instruction;";

the thirteenth to exclude the paragraph.

With respect thereto the fourteenth - twenty third to consider paragraphs respectively paragraphs the thirteenth - the twenty second;

in the paragraph the twenty second "ґ" to replace letter with the letter "e";

  to add Chapter after Item 1.3 with new Item 1.4 of the following content:

"1.4. The bank according to Item 1.3 of Chapter 1 of the Section IV of this Instruction weighs on risk degree book value of the debt securities emitted in foreign currency by the central bodies of the executive power / local self-government of Ukraine using additional coefficients:

1) till March 31, 2020 - 0;

2) since March 31, 2020 - 0,2;

3) since June 30, 2020 - 0,5;

4) since December 31, 2020 - 1.".

With respect thereto Items 1. 1.5 to consider 4, respectively by Items 1. 5, 1.6;

 The second Item 2 of Chapter 2 figures and the words "1.4 Chapters 1 of this Section" to replace 2) in the paragraph with figures and the words "1.5 Chapters 1 of the Section IV of this Instruction".

5. The ninth Item 2 of Chapter 2 of the Section V to state the paragraph in the following edition:

"the irrevocable unconditional obligations on crediting received from banks which have credit rating on the international scale not lower than the VVV-level on classification of rating agency "Standard&poor" s" or Fitch Ratings/level Vaa3 rating agency on classification of rating agency of "Moody" of s Investors Service", in the amount considered at least three months in a row before settlement date of the standard rate.".

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