Document from CIS Legislation database © 2003-2022 SojuzPravoInform LLC

LAW OF THE REPUBLIC OF KAZAKHSTAN

of April 25, 2001 No. 178-II

About Development bank of Kazakhstan

(as amended on 27-12-2021)

Chapter 1. General provisions

Article 1. Development bank of Kazakhstan and its status

Development bank of Kazakhstan (further - Development bank) is joint-stock company which controlling stock is owned by national managing holding. Development bank is the national institute of development and bank authorized on realization of the state investment policy and the state stimulation of the industry.

Article 1-1. The basic concepts used in this Law

In this Law the following basic concepts are used:

1) interbank lending - issuance of credits to banks of the second level and nonresident banks of the Republic of Kazakhstan;

2) the project - the investment project, export transaction, leasing transaction;

3) the investment project - the project providing the investments directed to creation new, expansion and updating of the operating productions including on acquisition of assets, blocks of shares (shares in the authorized capital), property complexes;

4) the credit tool - the methods of financing of the borrower by Development bank determined in the Memorandum;

5) restructuring - complex of the actions directed to recovery of economic indicators of the investment project realized by the borrower who violated obligations to Development bank and (or) the third parties who can include write-off of remuneration, penalties and penalty fee and (or) financing or refinancing of working capital of the borrower, and (or) assignment of rights of requirements of Development bank to the borrower, and (or) entry of Development bank into the authorized capital of the borrower, and (or) provision of the subsidized loan to the borrower, and (or) other actions promoting recovery of economic indicators of the investment project;

6) the borrower - the legal entity who obtained loan from Development bank;

7) mezzanine financing - provision of subordinated loan with the right of its converting in shares or shares in the borrower's capital;

8) The memorandum - the Memorandum of credit policy of Development bank approved by the national managing director of the holding specified in article 1 of this Law;

9) syndicated loan - the loan transaction performed by Development bank together with other members of syndicate based on one agreement of bank loan in case of which representation of interests of members of syndicate under the agreement of bank loan, and also credit administration on loan can be charged to one of members of syndicate;

10) the subsidized loan - loan which cost of financing is established lower than the cost of borrowing established by Development bank for calculation of rates of remuneration for credit tools. Parameters on the subsidized loans are set by the Memorandum;

11) export transactions - export of products, the works and services made and issued in the territory of the Republic of Kazakhstan.

Article 2. Legal regulation of activities of Development bank

1. The legislation on Development bank of Kazakhstan is based on the Constitution of the Republic of Kazakhstan, consists of this Law and other regulatory legal acts.

2. The legislation of the Republic of Kazakhstan regulating activities of joint-stock companies, banking activity and other licensed types of activity is applied to Development bank in the part which is not settled by this Law and the Law of the Republic of Kazakhstan "About state-owned property".

3. Investment priorities of Development bank, quantitative restrictions to attraction of borrowed funds, limits, the directions, possible conditions, procedure and terms of crediting, placement of equity, joint financing, provision of guarantees, accomplishment of functions of the confided (agent), implementation of export transactions, provision of the subsidized loan and implementation of restructuring are established by the Memorandum.

Article 3. Purposes and tasks of Development bank

1. The purposes of activities of Development bank are enhancement and increase in efficiency of the state investing activities, development of production infrastructure and processing industry, assistance in attraction of external and internal investments into national economy.

2. Tasks of Development bank are:

1) financing of investment projects by means of implementation of transactions, the stipulated in Article 7 these Laws (including purpose-oriented loans to banks, credit lines), on medium-term (for the term of five years and more, except for the bank guarantees issued for a period of one year and more) and long-term (for a period of ten up to twenty years) basis, acquisitions of bonds by Development bank which funds from placement are allocated by the issuer for implementation of investment projects according to the procedure, determined by the Memorandum, and also interim financing for the purpose of ensuring preparation and implementation of investment projects;

2) financing of export transactions by means of implementation of transactions, the stipulated in Article 7 these Laws (including purpose-oriented loans to banks, credit lines, acquisition of bonds by Development bank which funds from placement are allocated by the issuer for realization of export transactions according to the procedure, determined by the Memorandum);

3) provision of mezzanine financing, project financing, provision of syndicated loan, financing of the current activities of the borrowers within projects implementation financed by Development bank;

4) stimulation of crediting of economy of the Republic of Kazakhstan by issue of warranty obligations on the loans granted by other credit institutes and also joint financing and interbank lending, issuance of credits to the organizations lessors, and also the organizations performing separate types of banking activities;

5) enhancement of funding mechanisms for projects;

6) other tasks according to the laws of the Republic of Kazakhstan.

Article 4. Functions of Development bank Functions of Development bank are:

1) search, selection and financing, including joint financing, projects according to the Memorandum;

2) carrying out on contractual basis of bank examination of the projects offered to financing;

3) implementation of borrowing within activities of Development bank;

4) interaction with the international and national institutes of development, the organizations within implementation of state programs, projects;

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