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The document ceased to be valid since  September 30, 2018 according to the Item 2 Resolution of Board of National Bank of the Republic of Kazakhstan of July 30, 2018 No. 167

RESOLUTION OF BOARD OF NATIONAL BANK OF THE REPUBLIC OF KAZAKHSTAN

of January 28, 2016 No. 21

About approval of Rules of carrying out by National Bank of the Republic of Kazakhstan of auctions within monetary policy realization

For the purpose of implementation of the Law of the Republic of Kazakhstan of November 24, 2015, 2015 "About modification and amendments in some legal acts of the Republic of Kazakhstan concerning the idle credits and assets of banks of the second level, rendering financial services and activities of the financial organizations and National Bank of the Republic of Kazakhstan" the Board of National Bank of the Republic of Kazakhstan DECIDES:

1. Approve the enclosed Rules of carrying out by National Bank of the Republic of Kazakhstan of auctions within monetary policy realization.

2. Recognize invalid regulatory legal acts of the Republic of Kazakhstan according to the list according to appendix to this resolution.

3. To department of monetary transactions and asset managements (Moldabekova A. M.) in the procedure established by the legislation of the Republic of Kazakhstan to provide:

1) together with Legal support department (Sarsenov N. V.) state registration of this resolution in the Ministry of Justice of the Republic of Kazakhstan;

2) the direction of this resolution in the republican state company on the right of economic maintaining "The republican center of legal information of the Ministry of Justice of the Republic of Kazakhstan":

on official publication in information system of law of Ad_let within ten calendar days after its state registration in the Ministry of Justice of the Republic of Kazakhstan;

for inclusion in the State register of regulatory legal acts of the Republic of Kazakhstan, Reference control bank of regulatory legal acts of the Republic of Kazakhstan within ten calendar days from the date of its obtaining by National Bank of the Republic of Kazakhstan after state registration in the Ministry of Justice of the Republic of Kazakhstan;

3) placement of this resolution on official Internet resource of National Bank of the Republic of Kazakhstan after its official publication.

4. To department of the international relations and public relations (Kazybayev A. K.) provide the direction of this resolution on official publication in periodic printing editions within ten calendar days after its state registration in the Ministry of Justice of the Republic of Kazakhstan.

5. To impose control of execution of this resolution on the vice-chairman of National Bank of the Republic of Kazakhstan Pirmatov G. O.

6. This resolution becomes effective after ten calendar days after day of its first official publication and extends to the relations which arose since February 1, 2016.

Chairman of National Bank

D. Akishev

Approved by the Resolution of Board of National Bank of the Republic of Kazakhstan of January 28, 2016 No. 21

Rules of carrying out by National Bank of the Republic of Kazakhstan of auctions within monetary policy realization

1. General provisions

1. These rules of carrying out by National Bank of the Republic of Kazakhstan of auctions within monetary policy realization (further – Rules) are developed according to the Law of the Republic of Kazakhstan of March 30, 1995 "About National Bank of the Republic of Kazakhstan" (further – the Law on National Bank) and determine procedure for carrying out by National Bank of the Republic of Kazakhstan (further – National Bank) auctions within realization of the state monetary policy of the Republic of Kazakhstan (further – monetary policy).

2. According to the monetary policy purposes for provision and withdrawal of liquidity the National Bank carries out the following types of auctions:

1) auction for security purchase with the return sale;

2) auction for security sale with repurchasing;

3) auction of short-term notes of National Bank;

4) deposit auction.

3. In Rules the concepts provided by the Civil code of the Republic of Kazakhstan (Special part) of July 1, 1999 and also the following concepts are used:

1) the participant of auction – the bank of the second level which is the bidder in the form of auction (further – auction) on security purchase with the return sale and auction for security sale with repurchasing, being the depositor of the central depositary;

2) day of execution of the transaction of security sale – day when the National Bank sells to the participant of auction securities;

3) day of execution of the transaction of security purchase – day when the National Bank buys securities from the participant of auction;

4) primary agent bank of the second level, the single accumulation pension fund, the national operator of mail service of the Republic of Kazakhstan, the organization, performing obligatory guaranteeing deposits, the state Social Insurance Fund, the organization specializing in improvement of quality of credit portfolios of banks of the second level and the organization performing the actions directed to construction of the building of the Reserve Center of National Bank;

5) the request with the competitive offer – the request of the participant of auction with indication of the price;

6) the request with the non-competitive offer – the request of the participant of auction without specifying of the price;

7) deposit interest rate – the interest paid by National Bank to the counterpartner who placed bank deposit in National Bank;

8) electronic system of data transmission – the financial automated system of transport of information (FASTI) or the international interbank system of information transfer and making payments – SWIFT;

9) the discounted price – the price is lower than nominal value taking into account discount rate;

10) discount rate – the interest rate used for calculation of the price and amount of security at the auction held by National Bank;

11) the investor – the client of primary agent;

12) stop-out price – the price on which the satisfaction of requests of primary agents comes to an end;

13) cutting off rate – minimum (for auction for security purchase with the return sale) or maximum (for auction for security sale with repurchasing) interest rate on which the satisfaction of requests comes to an end;

14) return rate – the parameter of the concluded bargains of purchase/sale and return sale / purchase used for calculation of the price of the return sale / purchase (the price of the second transaction) and the amount of transaction of the return sale / purchase;

15) the counterpartner – bank of the second level, being the participant of deposit auction;

16) the lombard list – the list of securities with indication of the national identification numbers permitted to purchase/sale by National Bank at auction for security purchase with the return sale and auction for security sale with repurchasing. The securities included in the lombard list conform to the following requirements:

release is allowed to the address at the biddings of stock exchange of the Republic of Kazakhstan;

from the date of the return sale / purchase of securities by National Bank before repayment of release there were at least 7 (seven) working days;

ownership limitation owing to existence of legal relationship between the owner of these securities and the third party is not imposed on securities.

The lombard list affirms according to the order of the Chairman of National Bank based on recommendations of advisory advisory body of National Bank – Technical committee on monetary policy of National Bank;

17) the weighted discounted average price – the average discounted price weighed to the total amount of short-term notes of National Bank which developed at auction for stop-out price;

18) weighted average rate – the average interest rate weighed to the total amount of the satisfied / partially satisfied requests of participants of auction / primary agents / counterpartners which developed at auction for cutting off rate;

19) interest rate – the amount expressed in percentage expression, paid to the participant of auction;

20) authorized division – the division of National Bank responsible for holding auctions;

21) early repayment of short-term notes of National Bank – the complete or partial conclusion National Bank from the address of short-term notes of National Bank before the repayment expiration in the secondary security market which is previously approved with primary date, quantity and redemption price agent;

22) the redemption of short-term notes of National Bank – the purchase of short-term notes of National Bank by National Bank in the secondary security market with possibility of their further address before the repayment expiration which is previously approved with primary date, quantity agent and the price of the redemption of short-term notes of National Bank;

23) the request for additional placement of short-term notes of National Bank – stage of issue of short-term notes of National Bank at auction at which there is additional placement to earlier issued to the addressing short-term notes of National Bank;

24) conditions of carrying out additional placement of short-term notes of National Bank – the conditions of additional placement of short-term notes of National Bank determined and announced by National Bank according to the purposes of monetary policy and including date of additional placement, circulation period, repayment date, amount of additional placement, condition of satisfaction of requests, payment date, additional placement form;

25) conditions of release and placement of short-term notes of National Bank – the conditions of release and placement of short-term notes of National Bank determined and announced by National Bank according to the purposes of monetary policy and including date of placement, circulation period, repayment date, amount of placement, condition of satisfaction of requests, payment date, placement form;

26) systems of Bloomberg, Thomson Reuters – complexes of specialized software and oborudovaniye by means of which communication between their users for the purposes of the conclusion of transactions is performed.

2. Procedure for holding the auction on security purchase with the return sale

4. The participant of auction signs with National Bank the agreement on procedure for the conclusion of transactions on purchase/security sale with the return sale / purchase by results of auction (further – the Agreement) in form according to appendix 1 to Rules. By agreement of the parties the Agreement joins the additional terms which are not contradicting Rules.

5. For agreement signature the potential participant of auction sends the written request (in any form) to National Bank for intention of the conclusion of transactions on purchase/security sale with the return sale / purchase with National Bank (further – the written request).

6. The National Bank reviews the written request and no more than 14 (fourteen) working days from the date of submission to National Bank make on it the decision in time. The decision on satisfaction of the written request of the participant of auction and the conclusion of the Agreement with it is accepted by the head of authorized division or in case of its absence person fulfilling its duties.

7. The participant of auction conforming to the following requirements is allowed to participation in auction for security purchase with the return sale:

1) lack of unexecuted obligations to National Bank according to the minimum reserve requirements two and more times during three consecutive calendar months on the date of submission to National Bank of information on accomplishment of standard rates of the minimum reserve requirements. This restriction is effective to payment date of the administrative penalty imposed for administrative offense according to the resolution on the case of administrative offense;

2) availability of the license for implementation of broker and/or dealer activities in the security market;

3) lack of violations of prudential standard rates on the date of participation in auction for security purchase with the return sale;

4) availability in the agreement(s) of the correspondent account opened in National Bank, the condition providing the right of National Bank to money withdrawal without acceptance from correspondent account of the participant of auction in case of non-execution of obligations by it on transactions with National Bank;

5) availability of the Agreement signed with National Bank;

6) availability of personal account in the central depositary.

8. Following the results of auction for security purchase with the return sale between National Bank and the participant of auction pair bargains are concluded:

1) on purchase of securities by National Bank (the first transaction, the transaction of purchase);

2) on the return sale of the same securities by National Bank in certain time after the transaction of purchase (the second transaction, the transaction of the return sale).

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