THE RESOLUTION OF BOARD OF THE AGENCY OF THE REPUBLIC OF KAZAKHSTAN ON REGULATION AND SUPERVISION OF THE FINANCIAL MARKET AND THE FINANCIAL ORGANIZATIONS

of March 26, 2005 No. 113

About approval of Rules of forced share repurchase of bank and their obligatory sale to investors

According to the Law of the Republic of Kazakhstan "About banks and banking activity in the Republic of Kazakhstan", the Law of the Republic of Kazakhstan "About state regulation and supervision of the financial market and the financial organizations" the Board of the Agency of the Republics Kazakhstan on regulation and supervision of the financial market and the financial organizations (further - the Agency) DECIDES:

1. Approve the enclosed Rules of forced share repurchase of bank and their obligatory sale to investors.

2. Recognize invalid:

1) the resolution of Board of National Bank of the Republic of Kazakhstan of December 31, 1996 No. 336 "About the Provision "About Procedure for the Forced Redemption and Sale of Shares of the Bank Having the Negative Size of the Capital" (registered in the Register of state registration of regulatory legal acts the Republic of Kazakhstan at No. 340, published on January 13-18, 1997 in editions of National Bank of the Republic of Kazakhstan "Kazakstan Ulttyk Bankinin Habarshysy" and "the Bulletin of National Bank of Kazakhstan" No. 2(42));

2) the resolution of Board of National Bank of the Republic of Kazakhstan of December 31, 1997 No. 485 "About approval of changes and amendments in the Regulations on procedure for the forced redemption and sale of shares of the bank having the negative size the capitals (registered in the Register of state registration of regulatory legal acts of the Republic of Kazakhstan at No. 660, published on January 1-17, 1999 in editions of National Bank of the Republic of Kazakhstan "Kazakstan Ulttyk Bankinin Habarshysy" and "the Bulletin of National Bank of Kazakhstan" No. 1 (145)).

3. This resolution becomes effective from the date of its state registration in the Ministry of Justice of the Republic of Kazakhstan.

4. To department of supervision of banks (Rayeva R. E.):

1) together with Legal department (Baysynov M. B.) to take measures to state registration in the Ministry of Justice of the Republic of Kazakhstan of this resolution;

2) in ten-day time from the date of state registration in the Ministry of Justice of the Republic of Kazakhstan to bring this resolution to the attention of the interested divisions of the Agency, National Bank of the Republic of Kazakhstan, Consolidation of legal entities "Association of financiers of Kazakhstan".

5. To department of the international relations and public relations (Pernebayev T. Sh.) take measures to publication of this resolution in mass media of the Republic of Kazakhstan.

6. To impose control of execution of this resolution on the vice-chairman of the Agency Bakhmutova E. L.

Approved by the Resolution of Board of the Agency of the Republic of Kazakhstan on regulation and supervision of the financial market and the financial organizations of March 26, 2005 No. 113

Rules of forced share repurchase of bank and their obligatory sale to investors

These rules are developed according to the Law of the Republic of Kazakhstan "About banks and banking activity in the Republic of Kazakhstan", the Law of the Republic of Kazakhstan "About state regulation and supervision of the financial market and the financial organizations", other regulatory legal acts, determine procedure for the forced redemption authorized body by regulation and supervision of the financial market and the financial organizations (further - authorized body) in coordination with the Government of the Republic of Kazakhstan of bank shares having the negative size of equity (further - bank), and their obligatory subsequent sale to investors/investors (daleeinvestor) for the purpose of protection of interests of creditors of bank and ensuring banking system stability of the Republic of Kazakhstan.

Chapter 1. General provisions

1. The forced share repurchase of bank for the purpose of their sale to the new investor is made by authorized body in case of establishment at bank of the negative size of equity.

2. The share price of bank in case of the forced redemption is determined by authorized body proceeding from the size of asset cost of bank less the amount of its obligations on acceptance date it decisions on forced share repurchase of bank.

3. Implementation of the redeemed bank shares is made by authorized body without delay at the acquisition price on the conditions guaranteeing increase in equity of bank (daleerekapitalization) and its normal functioning taking into account the obligations undertaken by the investor.

Chapter 2. Procedure for carrying out the forced redemption and sale of shares of bank

4. After establishment of the circumstances stated in Item 1 of these rules and in case of intention to perform forced share repurchase of bank for the purpose of their immediate sale the authorized body performs actions for search of the investor, intended to acquire bank shares.

5. Person interested in share purchase of bank shall meet requirements imposed by the bank law of the Republic of Kazakhstan to shareholders of bank.

6. The decision on forced share repurchase of bank and their sale is accepted by Board of authorized body based on the petition confirming intention and possibility of the investor to acquire bank shares, including the statement of the investor for sale of bank shares to it, the actions plan on recapitalization of bank (improvement of financial position) and specifying on the amount of money necessary for recapitalization of bank which the investor is ready to bring for the bank account of authorized body in National Bank of the Republic of Kazakhstan (further - National Bank).

7. In cases when two or more persons who wished to become investors of one bank file petition for share acquisition of bank, they need to provide the agreement signed among themselves determining the number of the bank shares acquired by each of them and amount of money which are subject to entering into payment for the redeemed shares, and also accomplishment of other requirements provided by these rules.

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