RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of May 4, 2005 No. 14/3

About the Provision "About Licensing of Credit Unions"

Having considered the project of new edition of the Provision "About Licensing of Credit Unions" developed based on the Law of the Kyrgyz Republic "About credit unions", the Law of the Kyrgyz Republic "About National Bank of the Kyrgyz Republic" and the Credit agreement between the Kyrgyz Republic and Asian Development Bank No. 1529 KGZ (SF) the Rural Financial Institutions Project and also for the purpose of enhancement of activities of the Board of National Bank credit unions of the Kyrgyz Republic decides:

1. Approve the Provision "About Licensing of Credit Unions" it (is applied).

2. To management of methodology of supervision and licensing together with Legal department in accordance with the established procedure to carry out state registration of this resolution in the Ministry of Justice of the Kyrgyz Republic.

3. This resolution becomes effective from the moment of publication in mass media after state registration in the Ministry of Justice of the Kyrgyz Republic.

4. From the moment of enforcement of this resolution to declare invalid:

- The resolution of Board of National Bank of the Kyrgyz Republic No. 8/1 of 13.02.2002. "About new edition of the Provision "About Licensing of Credit Unions";

- The resolution of Board of National Bank of the Kyrgyz Republic "About modification and amendments in No. 21/3 Provision "About Licensing of Credit Unions" of 09.07.2003;

- The resolution of Board of National Bank of the Kyrgyz Republic No. 6/6 of 27.03.2004.

5. To department of supervision of non-bank organizations to bring this resolution to the attention of OSOO "Finance Company on Support and Development of Credit Unions in the Kyrgyz Republic", regional managements and Representative office of National Bank of the Kyrgyz Republic in Batken Province.

6. OSOO "Finance Company on Support and Development of Credit Unions in the Kyrgyz Republic" bring this resolution to the attention of credit unions.

7. After publication of this resolution to inform the Ministry of Justice of the Kyrgyz Republic on publication source (the name of the edition, its number and date).

8. To impose control of execution of this resolution on Omurzakova G. M., the vice-chairman of National Bank of the Kyrgyz Republic.

Approved by the Resolution of Board of National Bank of the Kyrgyz Republic of May 4, 2005 No. 14/3

Regulations on licensing of credit unions

1. General provisions

1.1. This Provision determines procedure for issue by National Bank of the Kyrgyz Republic (further by the text of NBKR) licenses to credit unions.

1.2. The credit union is the financial credit institution created in the form of cooperative for the purpose of assistance to the participants (members) by merge of personal savings of members of credit union and their use for mutual lending, and also rendering other financial services including according to the Islamic principles of banking and financing.

1.3. For the purpose of this provision, in case of assessment of observance of economic standard rates, restrictions and requirements of NBKR, the capital of credit union includes: unallotted profit / loss of the last years, losses of the current year, reserves of future requirements, the amount of the savings shares brought by members of credit union for a period of 1 year and more and having the special term of withdrawal.

1.4. The credit union performs the activities based on the following licenses NBKR:

1) the license to start implementation of the activities for the following transactions:

- attraction of money from the participants by acquisition of savings share by them;

- provision to members of credit union of the credits on the terms of urgency, recoverability and the paid nature;

- rendering financial services according to the Islamic principles of banking and financing according to the Provision "About the Transactions Performed by the Microfinancial Organizations and Credit Unions according to the Islamic Principles of Banking and Financing" approved by the resolution of Board of National Bank of 26.10.2011 No. 60/8.

2) additional license for implementation of the following financial services (transactions):

- attraction of deposits (deposits) from members of credit union in national and foreign currency

In the presence of the license for attraction of deposits (deposits) from members of credit union in national and foreign currency the Credit union also has the right to obtain the following additional licenses on:

- implementation of retail banking services according to the agency agreement with bank - without opening of accounts to clients in credit union;

- implementation of calculations at the request of members of credit union for the contract with bank or other authorized financial credit institute without opening of the account in credit union;

- provision to members of credit union of the credits on the terms of urgency, recoverability and the paid nature in foreign currency;

- implementation of purchase and sale of foreign currency on its own behalf, according to regulatory legal acts of National Bank.

1.5. Before receipt of the license NBKR to credit union occupation by any activities as the legal entity, except for is forbidden to the organizational activities connected with organization of credit union.

1.6. The credit union has the right to render the financial services specified in the license.

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