RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of February 25, 1997 No. 5/7

About approval of the Temporary procedure for revocation of license on banking operations of banks in the Kyrgyz Republic and liquidation of banks

Having considered the provided Temporary procedure for revocation of license on banking operations of banks in the Kyrgyz Republic and liquidation of banks, the Board of National Bank decides:

1. Approve the Temporary procedure for revocation of license on banking operations of banks in the Kyrgyz Republic and liquidation of banks it (is applied).

2. Enact this Temporary procedure from the moment of decision making.

3. To general department to bring this Temporary procedure to the attention of all commercial banks of the republic and structural divisions of National Bank.

4. To impose control over the implementation of this resolution on the head of department of banking supervision of Mr. Abdybala tegin Page.

Approved by the Resolution of Board of National Bank of the Kyrgyz Republic of February 25, 1997, No. 5/7

Temporary procedure for revocation of license on banking operations of banks in the Kyrgyz Republic and liquidation of banks

1. Revocation of license on banking operations of the banks located in the territory of the Kyrgyz Republic is made by National Bank of the Kyrgyz Republic according to the Laws "About Banks and Banking Activity in the Kyrgyz Republic", "About National Bank of the Kyrgyz Republic", "About Bankruptcy", the Instruction on features of application of the Law of the Kyrgyz Republic "About bankruptcy" for banks, this Procedure and instructions of National Bank of the Kyrgyz Republic.

2. Revocation of license on banking operations is exclusive corrective action which, as a rule, precede other measures of precautionary nature provided by the Law "About National Bank of the Kyrgyz Republic" and regulations NBKR.

3. The license for banking operations can be revoked in cases:

1) detection of false information based on which the license is granted;

2) delays of the beginning of activities of bank more than for one year from the moment of its registration;

3) implementation of the transactions forbidden by the current legislation;

4) implementation of the transactions which are not provided by the license of bank;

5) recognitions of bank by the bankrupt according to the current legislation of the Kyrgyz Republic and only at the initiative of National Bank of Kyrgyzstan;

6) closings of foreign head bank with foreign banking supervisor authority at branch, subsidiary bank or representative office of this foreign bank in the republic;

7) violations of requirements of the antitrust law by bank;

8) failures to meet requirements of the bank law;

9) failure to provide or provision of the doubtful reporting and information;

10) emergence of situation which threatens interests of creditors and bank depositors, based on the Law "About Bankruptcy" (*).

(*) the note - in view of the fact that the provision of insolvent bank constitutes serious danger to investors and financial system, the direction before revocation of license of preliminary instructions about elimination of illegal actions is not required;

11) violations of the economic standard rates provided by the Law "About National Bank of the Kyrgyz Republic";

12) detection of the facts of forming of the minimum authorized capital with violations of the current legislation of the Kyrgyz Republic;

13) discrepancies of the foundation agreement and the charter of bank to the legislation existing in the republic;

14) discrepancies of the officials of bank to criteria of professional suitability provided by the current legislation;

15) intentional provision in seal of the untrue data on activities of bank;

16) violations of the conditions and terms of salary payment, pensions, benefits and other social payments provided by the Law "About Ensuring Timeliness of Salary Payment, Pensions, Benefits and Other Social Payments", based on article 6 of the called Law;

17) participations or contributions in criminal activities.

4. Activities of banks can be stopped based on the Law "About Bankruptcy", Article 50.

The bank can stop the activities based on article 6 of the Law "About Bankruptcy", article 75 of the Law "About Economic Partnerships and Societies" and to hand over the license for making of banking activities only with the prior notice NBKR and on condition of satisfaction of requirements of all creditors. At the same time the bank shall at least in 2 months prior to delivery of the license notify on the intention investors and creditors by publication of the relevant information in official seal.

5. The decision of National Bank of the Kyrgyz Republic on revocation of license on banking operations is made by Board of National Bank of the Kyrgyz Republic (further in the text - the Decision).

The decision on revocation of license on banking operations means prohibition of this organization to make any banking activities.

6. The general department of National Bank of the Kyrgyz Republic (*) from the moment of decision making sends it to two-day time to all regional managements of National Bank of the Kyrgyz Republic, NBKR organizations performing settlement cash transactions, to all commercial banks of the Kyrgyz Republic, the State tax authorities of the Kyrgyz Republic, the State customs inspection under the Government of the Kyrgyz Republic, to the Ministry of Justice of the Kyrgyz Republic and National Statistical Committee of the Kyrgyz Republic.

(*) - hereinafter the working days mean.

7. Regional managements of National Bank of the Kyrgyz Republic in two-day time in official procedure bring contents of the Decision to the attention of all banks located in the subordinated territory.

8. In day of receipt of the Decision the chief of UBN (replacement his face) gives him to bank from which the license for banking operations is revoked. The decision on revocation of license is handed to the Chairman of the board or Bank boards.

After delivery of the Decision of National Bank of the Kyrgyz Republic on response at bank of the license for banking operations, the inspector of UBN of National Bank of the Kyrgyz Republic withdraws authentic copy of the license from bank.

9. NBKR appoints the Interim manager of bank according to the Instruction about features of application of the Law of the Kyrgyz Republic "About bankruptcy" for banks.

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