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The document ceased to be valid since January 3, 2017 according to Item 7 of the Resolution of Board of the National Bank of Ukraine of June 30, 2016 No. 351

It is registered

Ministry of Justice of Ukraine

February 15, 2012

No. 231/20544

RESOLUTION OF BOARD OF THE NATIONAL BANK OF UKRAINE

of January 25, 2012 No. 23

About approval of the Regulations on procedure for forming and use by banks of Ukraine of reserves for compensation of possible losses on active banking activities

(as amended on 28-01-2016)

According to articles 7 and 59 of the Law of Ukraine "About the National Bank of Ukraine", articles 36 and 66 of the Law of Ukraine "About banks and banking activity", taking into account basic provisions of international accounting standards and the principles and recommendations of Basel Committee on Banking Supervision, for the purpose of enhancement of procedure for forming of reserves on active banking activities the Board of the National Bank of Ukraine DECIDES:

1. Approve Regulations on procedure for forming and use by banks of Ukraine of reserves for compensation of possible losses on active banking activities (further - Regulations on forming and use of reserves) which is applied.

2. To banks of Ukraine:

till 20.11.2012 and 20.12.2012 respectively to inform General department of banking supervision of the National Bank of Ukraine in the form established by the National Bank of Ukraine of results of the calculation of reserves perfromed in the test mode between01.11.2012 and at. 2012, according to requirements of the Regulations on forming and use of reserves;

as of 01.01.2013 to perfrom calculation and to create in full reserves for compensation of possible losses on active banking activities according to requirements of the Regulations on forming and use of reserves.

3. Requirements of paragraph two of Item 2.6 of Chapter 2 and paragraph two of Item 3.5 of Chapter 3 of the Section ІІ Regulations on forming and use of reserves do not extend to the credit operations performed based on the agreements signed till 28.12.2008.

4. Requirements of the paragraph of the sixth Item 2.6 of Chapter 2 and the paragraph of the sixth Item 3.5 of Chapter 3 of the Section ІІ Regulations on forming and use of reserves do not extend to the credit operations performed based on the agreements signed before entry into force of this resolution and to which after this date changes concerning increase in the amounts were not made.

5. Recommend to banks of Ukraine to perfrom during 2012 calculation of reserves according to requirements of the Regulations on forming and use of reserves in the test mode.

6. Recognize invalid regulatory legal acts of the National Bank of Ukraine according to the list which is attached.

7. (Novikov V. V.) to submit to department of normative and methodological ensuring bank regulation and supervision (Ivanenko N. V.), Legal department this resolution on state registration to the Ministry of Justice of Ukraine.

8. To department of normative and methodological ensuring bank regulation and supervision (Ivanenko N. V.) after state registration in the Ministry of Justice of Ukraine to bring contents of this resolution to permission of structural divisions of central office, territorial administrations of the National Bank of Ukraine and banks of Ukraine for management and use in work.

9. To accounting department (Lukasiewicz B. V.) within five months from the effective date of this resolution to make corresponding changes to regulatory legal acts of the National Bank of Ukraine on financial accounting concerning calculation of this cost of future cash flows for assets.

10. The resolution becomes effective from the date of its official publication, except Item 6, which becomes effective since 31.12.2012.

11. To impose control over the implementation of this resolution on the vice-chairman of the National Bank of Ukraine Sorkin I. V.

Chairman

S. G. Arbuzov

Appendix

to the Resolution of Board of the National Bank of Ukraine of January 25, 2012 No. 23

List of regulatory legal acts of the National Bank of Ukraine, invalid

2. The resolution of Board of the National Bank of Ukraine of 24.10.2000 No. 418 "About modification of separate regulatory legal acts of the National Bank of Ukraine", registered in the Ministry of Justice of Ukraine 09.11.2000 for No. 793/5014.

3. The resolution of Board of the National Bank of Ukraine of 05.04.2001 No. 151 "About modification of some provisions of regulatory legal acts of the National Bank of Ukraine", registered in the Ministry of Justice of Ukraine 18.04.2001 for No. 354/5545.

4. The resolution of Board of the National Bank of Ukraine of 07.12.2001 No. 502 "About approval of Changes to some regulatory legal acts of the National Bank of Ukraine", registered in the Ministry of Justice of Ukraine 26.12.2001 for No. 1077/6268.

5. The resolution of Board of the National Bank of Ukraine of 13.12.2002 No. 505 "About approval of the Regulations on procedure for forming and use of reserve by banks for compensation of possible losses from receivables", registered in the Ministry of Justice of Ukraine 02.01.2003 for No. 1/7322.

6. The resolution of Board of the National Bank of Ukraine of 19.03.2003 No. 119 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 03.04.2003 for No. 256/7577.

7. The resolution of Board of the National Bank of Ukraine of 15.08.2003 No. 339 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 29.08.2003 for No. 751/8072.

8. The resolution of Board of the National Bank of Ukraine of 27.08.2004 No. 411 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 07.09.2004 for No. 1105/9704.

9. The resolution of Board of the National Bank of Ukraine of 17.01.2005 No. 10 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 01.02.2005 for No. 122/10402.

10. The resolution of Board of the National Bank of Ukraine of 10.06.2005 No. 210 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 16.06.2005 for No. 666/10946.

11. The resolution of Board of the National Bank of Ukraine of 11.11.2005 No. 425 "About approval of Changes to Regulations on procedure for forming and use of reserve by banks for compensation of possible losses from receivables", registered in the Ministry of Justice of Ukraine 28.11.2005 for No. 1430/11710.

13. The resolution of Board of the National Bank of Ukraine of 19.03.2007 No. 83 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 30.03.2007 for No. 301/13568.

14. The resolution of Board of the National Bank of Ukraine of 06.07.2007 No. 248 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 20.07.2007 for No. 841/14108.

15. Items 1 and 3 of the resolution of Board of the National Bank of Ukraine of 23.07.2008 No. 211 "About modification of some regulatory legal acts of the National Bank of Ukraine", registered in the Ministry of Justice of Ukraine 14.08.2008 for No. 751/15442 (with changes).

16. The resolution of Board of the National Bank of Ukraine of 01.12.2008 No. 406 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 17.12.2008 for No. 1206/15897.

17. Subitem 1.7 of Item 1 of the resolution of Board of the National Bank of Ukraine of 08.10.2010 No. 457 "About modification of some regulatory legal acts of the National Bank of Ukraine", registered in the Ministry of Justice of Ukraine 13.12.2010 for No. 1249/18544 (with changes).

18. The resolution of Board of the National Bank of Ukraine of 31.12.2010 No. 593 "About modification of the Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 19.01.2011 for No. 79/18817.

19. The resolution of Board of the National Bank of Ukraine of 13.04.2011 No. 114 "About modification of some regulatory legal acts", registered in the Ministry of Justice of Ukraine 17.06.2011 for No. 724/19462.

20. The resolution of Board of the National Bank of Ukraine of 31.05.2011 No. 170 "About modification of the Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 06.06.2011 for No. 677/19415.

21. The resolution of Board of the National Bank of Ukraine of 14.07.2011 No. 235 "About introduction of amendments to the resolution of Board of the National Bank of Ukraine of 13.04.2011 No. 114", registered in the Ministry of Justice of Ukraine 20.07.2011 for No. 895/19633.

22. The resolution of Board of the National Bank of Ukraine of 28.12.2011 No. 486 "About approval of Changes to Regulations on procedure for forming and use of reserve for compensation of possible losses on credit operations of banks", registered in the Ministry of Justice of Ukraine 24.01.2012 for No. 99/20412.

Director of the department of normative methodological ensuring bank regulation and supervision

N. V. Ivanenko

The Resolution of Board of the National Bank of Ukraine of January 25, 2012 is approved No. 23

Regulations on procedure for forming and use by banks of Ukraine of reserves for compensation of possible losses on active banking activities

Section I. General provisions

Chapter 1. Basic provisions

1.1. This Provision is developed based on the Laws of Ukraine "About banks and banking activity", "About the National Bank of Ukraine", regulatory legal acts of the National Bank of Ukraine, taking into account the main requirements of international accounting standards, recommendations of Basel Committee on Banking Supervision, for the purpose of ensuring reliability and banking system stability, depositor protection and creditors of banks.

1.2. This Provision determines procedure (technique) for forming and use by banks of Ukraine of reserves for compensation of possible losses by active banking activities (further - reserves).

1.3. The bank for the purpose of determination of possible losses (losses) of failure to carry out by the debtor/partner of obligations performs risk assessment of failure to carry out of such obligations by it (that is risk that accomplishment by the debtor of the obligation will be carried out with excess of the terms provided by terms of the contract or in amounts it is, less, than it is provided by the agreement, or it will not be performed at all) on all to active banking activities and the financial liabilities provided by bank.

1.4. The reserves determined in this Provision are subdivided on:

reserves on assets (on financial assets and on receivables on economic activity of bank);

reserves according to the provided financial liabilities.

1.5. Reserves on assets are the special (estimative) reserves reducing book value of assets and which necessity of forming is caused by reduction of usefulness of such assets.

Reserves according to the provided financial liabilities are ensuring their accomplishment in the future that is recognized balance of bank as the obligation and demonstrates possible losses as a result of the disposal of resources connected with accomplishment of such financial liabilities by bank.

1.6. The bank estimates risk of failure to carry out by the debtor/partner of obligations and creates reserve in full irrespective of the size of its income as of the first day of every month following for reporting, prior to the due date of provision of the statistical reporting under the form No. 10 (monthly) "Oborotnosaldovy balance of bank" approved by the corresponding regulatory legal act of the National Bank of Ukraine.

If in the next periods after forming of reserve on asset (except shares and other securities with unfixed profit which are considered by bank in portfolio for sale) or according to the provided financial liabilities the amount of reserve decreases, then the bank reduces (adjusts) earlier created reserve on this asset.

1.7. The bank develops and approves by the decision of authorized body intra bank provisions concerning risks assessment, forming and uses of reserves by each type of financial assets, group of financial assets, receivables, on economic activity of bank and the provided financial liabilities.

Intra bank provisions are developed by bank taking into account the legislation of Ukraine, including regulatory legal acts of the National Bank of Ukraine, shall contain the techniques and procedures determined in appendix 1 to this Provision which are obligatory and minimum necessary for risks assessment.

1.8. The bank on each credit of the debtor creates the credit documentation (case) of the debtor according to the requirements determined by this Provision.

The credit documentation (case) of the debtor shall contain minimum necessary data which list it is given in appendix 2 to this Provision. Depending on type of credit operation the bank can expand the list of data on the debtor, previously having specified them in intra bank provisions.

Summarized information on credit operation is created since the conclusion of the agreement and updated throughout its action in part which underwent changes, within five working days from day of obtaining by bank of information which is the basis for introduction of such changes (change of conditions of carrying out/implementation of credit operation, constituent and registration data of the debtor, its financial condition and so forth).

1.9. Absence or not giving of intra bank provisions or the credit documentation (case) for acquaintance to authorized employees of the National Bank of Ukraine is the basis for the negative conclusions concerning efficiency and/or adequacy of risk management system in bank, and also applications to bank of corrective actions, according to the procedure, established by regulatory legal acts of the National Bank of Ukraine.

1.10. In this Provision terms are used in such values:

active banking activity - transaction on placement of resources of bank which is considered according to active balance sheet accounts of bank or according to active accounts of off-balance accounting. All types of credit operations, transactions on investment of funds on correspondent accounts in other banks, transaction on acquisition of securities, other active banking activities, including the income added on all these transactions belong to such transactions (further - asset);

the debtor's debt - the debt on asset including the amount of the main debt to bank and/or imputed incomes;

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