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RESOLUTION OF BOARD OF THE NATIONAL BANK OF UKRAINE

of December 29, 2023 No. 202

About approval of the Regulations on procedure for supervision on the consolidated basis of non-bank financial groups

According to Articles 7, of 15, 55-1, 56 of the Law of Ukraine "About the National Bank of Ukraine", Articles 21-26, of Item 30 of the Section VII of the Law of Ukraine "About financial services and finance companies", for the purpose of settlement of procedure for supervision on the consolidated basis of non-bank financial groups in which overwhelming activities are performed by financial institutions, state regulation and supervision of which is exercised by the National Bank of Ukraine, the Board of the National Bank of Ukraine decides:

1. Approve the enclosed Regulations on procedure for supervision on the consolidated basis of non-bank financial groups (further - the Provision).

2. To non-bank financial groups, state regulation and supervision of which activities is exercised by the National Bank of Ukraine (further - National Bank), to bring the activities into accord with the requirements established by the Provision within six months from the date of entry into force of this resolution.

3. Procedures of identification/recognition/derecognition of non-bank financial groups, identifications/recognitions of change of structure of property of non-bank financial group, coordination of the responsible person of non-bank financial group which were begun before entry into force of this resolution come to the end with observance of procedure and requirements of the regulatory legal acts of National Bank existing on start date of such procedures.

The decision on recognition/refusal in recognition of non-bank financial group, about recognition of change of structure property/refusal in recognition of change of structure of property of non-bank financial group, about the termination recognition/refusal in derecognition of non-bank financial group, about coordination/refusal in coordination of the responsible person of non-bank financial group accepts Committee on questions of supervision and regulation of activities of the markets of non-bank financial services.

4. Responsible persons of non-bank financial groups submit to National Bank the consolidated statements of non-bank financial group as of December 31, 2023 constituted according to requirements of provision, and according to the procedure, determined in the Provision.

5. Responsible persons of non-bank financial groups in case of creation of the report on the regulatory capital of non-bank financial group of the consolidated statements of non-bank financial group on reporting dates on December 31, 2023 and on March 31, 2024 determine the size of the regulatory capital, the necessary size of the regulatory capital and sufficiency of the regulatory capital of non-bank financial group according to the calculation established in appendix to this resolution.

6. The National Bank does not apply corrective action to the responsible person of non-bank financial group for untimely submission of the consolidated statements of non-bank financial group with reporting dates on December 31, 2023, on March 31, 2024 and/or the made mistakes in case of creation of the specified reporting provided that the consolidated statements of non-bank financial group is submitted to National Bank in full till June 25, 2024.

7. Declare invalid the resolution of Board of the National Bank of Ukraine of December 2, 2021 No. 128 "About approval of the Regulations on procedure for supervision on the consolidated basis of non-bank financial groups".

8. To department of methodology of regulation of activities of non-bank financial institutions (Sergey Savchuk) after official publication to inform participants of the market of non-bank financial services information on adoption of this resolution.

9. The resolution becomes effective since January 1, 2024.

Appendix

to the Resolution of Board of the National Bank of Ukraine of December 29, 2023 No. 202

Calculation of the size of the regulatory capital, the necessary size of the regulatory capital and sufficiency of the regulatory capital of non-bank financial group as of reporting dates on December 31, 2023 and on March 31, 2024

1. The size of the regulatory capital of non-bank financial group is equal to the amount of the sizes of the regulatory capitals of members of insurance subgroup (in the presence), other participants of this group for whom the requirement for determination of the regulatory capital reduced by the amount of investments of members of non-bank financial group is established (shareholding, shares, shares) in the capital of other participants of this group, and the capital of other members of non-bank financial group which is determined with deduction of mutual investments into the capital of members of non-bank financial group if such deduction was not performed when calculating the capital of members of non-bank financial group.

2. The necessary size of the regulatory capital of non-bank financial group is equal to the amount of the necessary sizes of the regulatory capital of each of participants of this group (if subgroups are not determined) or insurance subgroup (in the presence) and other members of non-bank financial group taking into account provisions of Items 4, of the 5th this appendix.

3. the regulatory capital of insurance subgroup of non-bank financial group / insurance company if there is no insurance subgroup, is determined by the following formula:

Rksp = SALVAGED + VAV,

where Rksp - the regulatory capital of insurance subgroup / insurer if there is no insurance subgroup;

SPA - the amount of acceptable assets on reporting dates on December 31, 2023, on March 31, 2024;

З - the amount of sizes of long-term and current obligations and providing calculated according to the legislation of Ukraine and determined as the total size of Sections II-IV of liability of balance (the report on financial condition) which form and structure of Articles are determined by national provision (standard) of financial accounting 1 "General requirements to the financial reporting" approved by the order of the Ministry of Finance of Ukraine of February 07, 2013 No. 73, registered in the Ministry of Justice of Ukraine on February 28, 2013 at No. 336/22868 (with changes) (further - the order No. 73);

VAV - the size of delayed acquisition expenses applied by the insurer to determination of the normative amount of assets determined for the purpose of observance of the norm of solvency and capital adequacy according to requirements and taking into account the restrictions set by the regulatory legal act establishing obligatory criteria and capital adequacy ratios and solvencies, liquidities, qualities of assets and riskiness of transactions of the insurer on reporting dates on December 31, 2023, on March 31, 2024.

The regulatory capital of insurance subgroup is calculated according to the subconsolidated statements of insurance subgroup / the financial reporting of insurance company.

4. The regulatory capital of other members of non-bank financial group is determined according to the requirements established by the legislation of Ukraine. If such requirements are not established, then the regulatory capital is determined in the amount of equity, reflected in the financial reporting of the member of non-bank financial group in the report "Balance (the report on the financial condition)" (result according to the Section I "Equity") reduced by the amount of residual cost of intangible assets (Article 1000 of the Section I "Non-current assets"), constituted taking into account order No. 73 provisions.

5. The necessary size of the regulatory capital of the participant of non-bank financial group / insurer if there is no insurance subgroup, is determined as big of the following sizes:

To;

NZP,

where To - the size equal:

for the insurer who performs or plans to perform types of insurance others, than life insurance, - 30 million UAH;

for the insurer who performs or plans to perform life insurance, - 45 million UAH;

NZP-normativny stocked solvencies which is calculated according to the legislation of Ukraine.

The necessary size of the regulatory capital of insurance subgroup is calculated as the amount of the necessary sizes of the regulatory capital of members of this subgroup.

6. The necessary size of the regulatory capital of other members of non-bank financial group is determined according to requirements (standard rates) of rather minimum size of own or authorized capital, established by the legislation of Ukraine.

7. Sufficiency of the regulatory capital is determined as difference between the size of the regulatory capital of non-bank financial group and the necessary size of the regulatory capital of non-bank financial group.

Approved by the Resolution of Board of the National Bank of Ukraine of December 29, 2023 No. 202

Regulations on procedure for supervision on the consolidated basis of non-bank financial groups

I. General provisions

1. This Provision is developed according to the Law of Ukraine "About the National Bank of Ukraine", the Law of Ukraine "About financial services and finance companies" (further - the Financial services act) taking into account the commonly accepted principles in the international practice and standards of supervision on the consolidated basis.

2. This Provision establishes:

1) procedure for identification by the controller of non-bank financial group (further - the controller) / the National Bank of Ukraine (further - National Bank) non-bank financial group in which preferential activities are performed by financial institutions, supervision of which is exercised by National Bank (further - non-bank financial group);

2) procedure for recognition by National Bank of non-bank financial group;

3) criteria of determination of subgroups within non-bank financial group;

4) requirements to the responsible person of non-bank financial group (further - the responsible person) and procedure for its coordination by National Bank;

5) requirements to structure of property of non-bank financial group and the notification procedure about changes of structure of property of non-bank financial group and types of activity of her participants;

6) requirements to corporate management systems, internal control, including risk management (further - internal control system) non-bank financial group;

7) requirements for observance of prudential standard rates and prudential requirements to non-bank financial group;

8) requirements for creation of the consolidated and subconsolidated statements of non-bank financial group and procedure for provision by non-bank financial group of necessary information to National Bank for the purpose of implementation of supervision on the consolidated and subconsolidated basis;

9) procedure for derecognition National Bank of non-bank financial group.

3. Terms in this Provision are used in such value:

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