RESOLUTION OF NATIONAL BANK OF THE REPUBLIC OF MOLDOVA

of February 26, 2020 No. 44

About approval of Regulations about requirements of covering of needs for liquidity for banks

Based on the item c) parts (1) Art. 27 of the Law on National Bank of Moldova No. 548/1995 (pereopublikovan: Monitorul Oficial al Republicii Moldova, 2015, No. 297-300, the Art. 544), with subsequent changes, parts (1), (2) and (4) Art. 76 and Art. 84 of the Law on activities of banks No. 202/2017 (Monitorul Oficial al Republicii Moldova, 2017, No. 434-439, the Art. 727), with subsequent changes, the Executive committee of National Bank of Moldova DECIDES:

1. Approve Regulations about requirements of covering of needs for liquidity for banks it (is applied).

2. Item 3 of Chapter II, Item 2 of Chapter III and Chapter V of the Regulations on bank liquidity (approved by AS of NBM, the protocol No. 28 of 8:08. To recognize 1997) invalid since 1.01.2022.

3. The regulations specified in Item 1 of this resolution become effective on October 1, 2020.

4. In departure from Item 3 of this resolution of provision of the regulations specified in Item 1 of this resolution on supervision on the consolidated basis of banks on effect of the lever for banks and approach to credit risk of the partner for banks, will be applied from the date of entry into force of the corresponding regulations.

Approved by the Resolution of Executive committee of National Bank of Moldova of February 26, 2020, No. 44

Regulations about requirements of covering of needs for liquidity for banks

These regulations are transposition of the item c) of the Art. 1, of the Art. 411, of parts (1) and (2) the Art. 412, of the Art. 414, of parts (1) and (2) Art. 415 of Regulations (EU) No. 575/2013 of the European Parliament and Council of the June 26, 2013 about prudential requirements to credit institutions and investment firms making changes to Regulations (EU) No. 648/2012, of the European Union published in the Official magazine of L 176 of June 27 2013, and with the last amendments made No. 2015/62 delegated by Regulations of the Commission (EU) of October 10 2014, and also partially shifts the delegated Regulations of the Commission (EU) 2015/61 of October 10 2014, of the making change in Regulations (EU) No. 575/2013 of the European Parliament and Council about covering of requirements of liquidity for credit institutions (the document extends to the EEA) published in the Official magazine of the European Union No. L 11 of January 17, 2015.

Chapter I General provisions

Part 1. Application of liquidity requirements

1. These regulations establish rules which banks - legal entities of the Republic of Moldova shall carry out, and also departments of banks from other states which are in the Republic of Moldova (further - "banks") for the purpose of determination and calculation of the requirement of covering of needs for liquidity as ratio between reserve of liquidity and net outflows of bank liquidity during the acute crisis (further - "crisis") constituting 30 days.

2. Banks observe provisions of these regulations on individual basis.

3. Banks carry out in measure and according to the methods provided by regulations of National Bank of Moldova (further - NBM) on supervision of banks on the consolidated basis, the requirements provided by these regulations based on their consolidated statement and following provisions:

1) assets of other states which fulfill the requirements provided by Chapter II and which belong to branch of other state are not recognized as quick assets in the consolidated purposes if they do not satisfy necessary conditions for recognition by quick assets based on the national legal system of the relevant state which establishes the requirement for covering of the needs for liquidity;

2) outflows of liquidity from branch of other state to which are applied, based on the national legal system of the relevant state which establishes the requirement for covering of the needs for liquidity, higher rates of outflow than specified in Chapter III are consolidation subject according to higher rates provided by the national legal system of the relevant state;

3) inflows of liquidity to branch of other state to which are applied, based on the national legal system of the relevant state which establishes the requirement for covering of the needs for liquidity, lower interests than specified in Chapter III are consolidation subject according to lower rates provided by the national legal system of the relevant state;

4) at the consolidated level the amount of inflows from specialized bank according to Items 104 and 105 is recognized only to the amount of outflow from the same specialized bank.

Part 2. Determinations

4. The concepts and expressions used in these regulations have the values provided in the Law on activities of banks No. 202/2017 (further - "Law No. 202/2017"), and in the regulations NBM published for application of the specified law.

5. In these regulations the following determinations are used:

1) "assets of the first level" mean assets with the excessive level of liquidity and credit quality according to part 2 of Chapter II.

2) "assets of the second level" mean assets with high liquidity and credit quality. Assets of the second level are subdivided into assets of level 2A and assets of level 2B according to part 2 of Chapter II.

3) "the financial client" means the client who performs one or several operations listed in Art. 14 of the Law No. 202/2017, or is one of the following subjects:

a) bank;

b) investment society;

c) non-bank financial society;

d) the organization of collective investment (further - OKA);

e) investment fund with fixed capital;

f) insurer;

g) overcautious person;

h) holding financial society or the mixed holding financial society;

4) "the marginal credits" mean the loans on the security granted to clients for the purpose of receipt of trade line items with effect of the lever.

5) "crisis" means sudden or serious deterioration in line item of solvency or bank liquidity because of changes of market conditions or some specific factors which lead to emergence of significant risk of the fact that the bank is not capable to fulfill the obligations, which repayment period during the next 30 days;

6) "retail deposits" is meant by the obligation to physical person or MSP (as it is determined in subitem 9) of this Item if the physical person or MSP is qualified for the type podverzhennost retail provided in item 61 of Regulations about approach to credit risk for banks according to the standardized approach, the approved PIK of NBM No. 111 of May 24, 2018 (further - Regulations 111/2018) and if the cumulative grouped deposits of these MSP do not exceed 5 million Moldovan lei;

7) wholesale financing (wholesale) means financings which do not fall in category of the retail deposits determined in the subitem 6) of this part.

8) "net outflow of liquidity" means the amount which is subtracted from deduction of inflow of liquidity of banks from its outflow of liquidity according to part 1 of Chapter III;

9) "MSP" means the microcompany, small enterprise and medium scale enterprise according to the Law on small and medium scale enterprises No. 179/2016;

10) "the liquidity reserve" means amount of quick assets which the bank owns according to part 2 of Chapter II of these regulations;

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