RESOLUTION OF BOARD OF NATIONAL BANK OF THE REPUBLIC OF BELARUS

of September 28, 2006 No. 138

About approval of the Instruction about procedure for forming and use of special reserves on covering of possible losses on the assets and transactions which are not reflected in balance

Based on Article part six paragraph two 34, No. 261 "About creation of "Development Bank of the Republic of Belarus" open joint stock company, Items 8 and 11 of article 176 of the Tax Code of the Republic of Belarus the Board of National Bank of the Republic of Belarus DECIDES: parts one of article 39 of the Bank code of the Republic of Belarus, part three of subitem 1.1 of Item 1 of the Presidential decree of the Republic of Belarus of June 21, 2011

1. Approve the Instruction about procedure for forming and use of special reserves on covering of possible losses on the assets and transactions which are not reflected in balance (further – the Instruction) it (is applied).

2. No. 141 is excluded according to the Resolution of Board of National Bank of the Republic of Belarus of 30.05.2025

2-1. No. 141 is excluded according to the Resolution of Board of National Bank of the Republic of Belarus of 30.05.2025

2-2. No. 350 is excluded according to the Resolution of Board of National Bank of the Republic of Belarus of 12.10.2023

3. To banks till December 31, 2006 to make changes to local regulatory legal acts for the purpose of establishment of signs of financial instability of the debtor, the partner on contingent obligations, and also additional criteria of reference urgent, prolonged and overdue debt on the assets subject to credit risk, and contingent obligations to the IV risk group according to requirements of the Instruction approved by this resolution and to submit them for approval to National Bank of the Republic of Belarus.

4. No. 203 is excluded according to the Resolution of Board of National Bank of the Republic of Belarus of 31.05.2022

5. Recognize invalid:

the resolution of Board of National Bank of the Republic of Belarus of September 29, 2004 No. 148 "About approval of the Instruction about procedure for forming and use of special reserve on covering of possible losses on the assets of bank and non-bank credit and financial organization subject to credit risk" (The national register of legal acts of the Republic of Belarus, 2004, No. 172, 8/11588);

the resolution of Board of National Bank of the Republic of Belarus of November 18, 2004 No. 172 "About approval of the Instruction about procedure for forming and use by banks and non-bank credit and financial organizations of reserve under impairment of securities" (The national register of legal acts of the Republic of Belarus, 2004, No. 191, 8/11725);

the resolution of Board of National Bank of the Republic of Belarus of August 31, 2005 No. 127 "About modification and amendments in the Instruction about procedure for forming and use of special reserve on covering of possible losses on the assets of bank and non-bank credit and financial organization subject to credit risk" (The national register of legal acts of the Republic of Belarus, 2005, No. 142, 8/13096);

the resolution of Board of National Bank of the Republic of Belarus of September 14, 2005 No. 130 "About modification of the Instruction about procedure for forming and use of special reserve on covering of possible losses on the assets of bank and non-bank credit and financial organization subject to credit risk" (The national register of legal acts of the Republic of Belarus, 2005, No. 156, 8/13180);

the resolution of Board of National Bank of the Republic of Belarus of November 22, 2005 No. 163 "About introduction of amendments and changes in the Instruction about procedure for forming and use of special reserve on covering of possible losses on the assets of bank and non-bank credit and financial organization subject to credit risk" (The national register of legal acts of the Republic of Belarus, 2005, No. 192, 8/13513);

the resolution of Board of National Bank of the Republic of Belarus of November 22, 2005 No. 164 "About modification and amendments in the Instruction about procedure for forming and use by banks and non-bank credit and financial organizations of reserve under impairment of securities" (The national register of legal acts of the Republic of Belarus, 2005, No. 192, 8/13514);

the resolution of Board of National Bank of the Republic of Belarus of January 31, 2006 No. 15 "About entering of amendments and changes into the Instruction about procedure for forming and use of special reserve on covering of possible losses on the assets of bank and non-bank credit and financial organization subject to credit risk" (The national register of legal acts of the Republic of Belarus, 2006, No. 37, 8/13960);

the resolution of Board of National Bank of the Republic of Belarus of March 21, 2006 No. 43 "About entering of amendments and changes into the Instruction about procedure for forming and use by banks and non-bank credit and financial organizations of reserve under impairment of securities" (The national register of legal acts of the Republic of Belarus, 2006, No. 54, 8/14205).

6. This resolution becomes effective since January 1, 2007, except for Items 3 and 4, which become effective from the date of official publication of this resolution.

Approved by the Resolution of Board of National Bank of the Republic of Belarus of September 28, 2006 No. 138

The instruction about procedure for forming and use of special reserves on covering of possible losses on the assets and transactions which are not reflected in balance

Chapter 1. General provisions

1. This Instruction is developed for the purpose of ensuring financial reliability of banks, "Development Bank of the Republic of Belarus" open joint stock company and the non-bank credit and financial organizations (further, unless otherwise specified, - bank), timely and complete obligation fulfillment before the investors and other creditors, implementation of proper risk management arising in their activities, maintenance of the normative capital of bank at the level sufficient for compensation of risks, forming of special reserves on covering of losses.

Requirements of this Instruction are not applied by the branches of foreign banks opened in the territory of the Republic of Belarus.

2. This Instruction determines procedure for forming and use of the following special reserves by banks on covering of possible losses (further, unless otherwise specified, – special reserves):

special reserve on covering of possible losses on the assets subject to credit risk, including reserve on covering of possible losses on portfolios of uniform assets and reserve on covering of possible losses on special portfolios of the uniform credits;

special reserve on covering of possible losses on the transactions which are not reflected in balance (further, unless otherwise specified, – contingent obligations).

3. Requirements of this Instruction do not extend on:

obligations on provision of money in the form of loans, the loans issued by bank (except for commercial loans);

the redeemed securities of own issue;

government securities of the Republic of Belarus, securities of National Bank, securities of the governments, Central (national) Banks of the countries of the group "A", banks of the group "A", international banks of development of the A0 group, international banks of development of group "A", international financial institutions (except as specified when securities are referred to category of the encumbered assets);

the means placed in National Bank;

shares;

the securities carried at fair value through profit or loss;

the contingent obligations connected with activities for ensuring own needs.

4. For the purposes of this Instruction in case of classification of debt the rating of the debtor, issuer of securities (further, unless otherwise specified, - the debtor), the partner on contingent obligations, appropriated by the international rating agencies, corresponding to the term and currency of the obligation is used.

5. For the purposes of this Instruction following terms have the following values:

5.1. the assets subject to credit risk, – debt to bank on assets on which there is credit risk, including:

the debt which resulted from provision of the credits by bank to legal entities (except banks), to individual entrepreneurs, physical persons, except individual entrepreneurs (further – physical persons), debt on the means provided to specified persons on repo operations and in case of issue (sale) of bills of exchange with payment deferral, the debt which arose on compensation by prikazodatel to bank of the money listed by bank according to the letter of credit (further, unless otherwise specified, – credit debt);

the debt which resulted from implementation of financing under concession of monetary claim (factoring);

the debt which resulted from concession to bank of the right of monetary claim to the third party (further – concession to bank of the right of monetary claim);

the debt which resulted from concession bank of the right of monetary claim with delay (payment by installments) of payment (further – concession bank of the right of monetary claim);

the debt which resulted from implementation of finance lease (leasing);

the debt which resulted from execution of the obligations issued by bank for the third parties;

debt on the acquired securities considered on the depreciated cost, debt securities carried at fair value through other comprehensive income (further, unless otherwise specified, – the securities subject to credit risk);

the debt which resulted from provision of advance payment, advance payment, delay (payment by installments) of payment of goods, works or services (commercial loan);

the debt which arose under the agreements connected with alienation by bank of the assets which resulted from discharge of the assets subject to credit risk with provision to the debtor, the issuer of securities (further, unless otherwise specified, – the debtor) the rights of delay (payment by installments) of payment;

debt on the means placed in other banks in the form of the credits, deposits on correspondent accounts, in the securities subject to credit risk emitted by other banks and also in any other forms irrespective of agreement type, including means in calculations, the debt which resulted from execution of the obligation of emitting bank by bank to make payment according to the letter of credit, including in relation to the emitting bank confirming to bank, the bank which issued the irrevocable reimbursement obligation or other warranty obligation (further – debt on the means placed in other banks);

debt on other active transactions subject to credit risk, including means in calculations for transactions with legal entities and physical persons;

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