RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of May 4, 2005 No. 14/2

About Regulations of activities of credit unions in the Kyrgyz Republic

Having considered the draft of Regulations of activities of credit unions in the Kyrgyz Republic 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 regulation of activities of credit unions, the Board of National Bank of the Kyrgyz Republic decides:

1. Approve Regulations of activities of credit unions in the Kyrgyz Republic 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 and to inform the Ministry of Justice of the Kyrgyz Republic on publication source (the name of the edition, its number and date).

3. This resolution becomes effective from the moment of publication in official publications of National Bank of the Kyrgyz Republic 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. 16/4 of 27.05.2003. "About new edition of Regulations of activities of credit unions in the Kyrgyz Republic".

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. 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 No. 14/2 of May 4, 2005

Regulations of activities of credit unions in the Kyrgyz Republic

I. General provisions

1.1. Ceased to be valid according to the Resolution of Board of National Bank of the Kyrgyz Republic of 15.06.2017 No. 2017-P-12/25-12

1.2. The National Bank of the Kyrgyz Republic (further - National Bank) according to the laws of the Kyrgyz Republic "About National Bank of the Kyrgyz Republic, banks and banking activity", "About credit unions" and other regulatory legal acts of the Kyrgyz Republic establishes the economic standard rates, requirements and restrictions obligatory for accomplishment by all credit unions, for the purpose of preserving stable financial system and protection of interests of members of credit union.

1.3. The National Bank establishes the following economic standard rates, requirements and restrictions for decrease in risks in activities of credit unions:

- by the minimum size of the capital of credit union and procedure for its forming;

- by the minimum size of savings share of the member of credit union;

- under the terms of loan granting to members of credit union;

- on borrowings of means from external sources;

- on investment of money of credit union;

- on the reserves created by credit unions;

- on nature, amount, the list of forms and terms of provision of the reporting.

1.3.-1. In the presence of the license of National Bank for implementation of foreign currency transactions with members of credit union, for the credit unions having the license for attraction of deposits limits are set:

- net foreign exchange position on each foreign currency;

- total foreign exchange position.

The procedure of payments of limits of foreign exchange position is determined by National Bank.

1.3.-2. Credit unions can perform transactions (transaction) on exchange of foreign currency with physical persons and legal entities in the presence of the corresponding license of National Bank. At the same time transactions (transaction) on exchange of foreign currency shall be performed according to requirements of the legislation on counteraction to financing of terrorist activities and legalization (washing) of the criminal income, and also requirements of other regulatory legal acts of the Kyrgyz Republic.

1.4. Credit unions can establish higher economic standard rates and restrictions for the purpose of additional decrease in risks, without breaking at the same time the values of standard rates and restrictions set by these rules and other regulations of National Bank.

II. Terms and determinations

The total capital is the amount of the institutional and equity capitals of credit union.

The institutional capital is total part of the capital which consists of reserves of future requirements, unallotted profit / losses of last years less losses of the current year.

The equity capital - includes 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. The term of withdrawal of such shares comes after the termination of financial year on condition of filing of application by the participant at least for half a year before the termination of financial year (till July 1 of the current year).

The paragraph the fourth is excluded according to the Resolution of Board of National Bank of the Kyrgyz Republic of 15.06.2022 No. 2022-P-33/37-2-(NFKU)

The paragraph the fifth is excluded according to the Resolution of Board of National Bank of the Kyrgyz Republic of 15.06.2022 No. 2022-P-33/37-2-(NFKU)

III. Observance of economic standard rates and restrictions

3.1. Credit unions shall observe economic standard rates, the requirements and restrictions set by National Bank:

3.1.1. The requirements and restrictions shown to credit unions:

- the minimum size of savings share of the participant under organization of credit union;

- the most admissible size of savings share of the member of credit union;

- minimum size of the capital of credit union;

- maximum size of deposit base.

3.1.2. The economic standard rates regulating activities of credit unions:

- standard rate of the maximum amount of external borrowings (H 1);

- the standard rate of the maximum extent of risk on one borrower (N 2);

- standard rate of the maximum amount of investments into the capital of financial credit institutions (N 3);

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