INSTRUCTION OF CENTRAL BANK OF THE RUSSIAN FEDERATION

of June 28, 2016 No. 4054-U

About procedure for forming by the microfinancial organizations of reserves on possible losses on loans

This Instruction based on the Federal Law of July 10, 2002 No. 86-FZ "About the Central bank the Russian Federation (Bank of Russia)" (The Russian Federation Code, 2002, No. 28, Art. 2790; 2003, No. 2, Art. 157; No. 52, Art. 5032; 2004, No. 27, Art. 2711; No. 31, Art. 3233; 2005, No. 25, Art. 2426; No. 30, Art. 3101; 2006, No. 19, Art. 2061; No. 25, Art. 2648; 2007, No. 1, Art. 9, Art. 10; No. 10, Art. 1151; No. 18, Art. 2117; 2008, No. 42, Art. 4696, Art. 4699; No. 44, Art. 4982; No. 52, Art. 6229, Art. 6231; 2009, No. 1, Art. 25; No. 29, Art. 3629; No. 48, Art. 5731; 2010, No. 45, Art. 5756; 2011, No. 7, Art. 907; No. 27, Art. 3873; No. 43, Art. 5973; No. 48, Art. 6728; 2012, No. 50, Art. 6954; No. 53, Art. 7591, Art. 7607; 2013, No. 11, Art. 1076; No. 14, Art. 1649; No. 19, Art. 2329; No. 27, Art. 3438, Art. 3476, Art. 3477; No. 30, Art. 4084; No. 49, Art. 6336; No. 51, Art. 6695, Art. 6699; No. 52, Art. 6975; 2014, No. 19, Art. 2311, Art. 2317; No. 27, Art. 3634; No. 30, Art. 4219; No. 40, Art. 5318; No. 45, Art. 6154; No. 52, Art. 7543; 2015, No. 1, Art. 4, Art. 37; No. 27, Art. 3958, Art. 4001; No. 29, Art. 4348, Art. 4357; No. 41, Art. 5639; No. 48, Art. 6699; 2016, No. 1, the Art. 23, the Art. 46, the Art. 50), Item 5 of part 4 of article 14 of the Federal Law of July 2, 2010 No. 151-FZ "About microfinancial activities and the microfinancial organizations" (The Russian Federation Code, 2010, No. 27, Art. 3435; 2011, No. 27, Art. 3880; No. 49, Art. 7040; 2013, No. 26, Art. 3207; No. 30, Art. 4084; No. 51, Art. 6683, Art. 6695; 2014, No. 26, Art. 3395; 2015, No. 27, Art. 4001; No. 29, Art. 4357; 2016, No. 1, the Art. 27) and according to the solution of the Board of directors of the Bank of Russia (the minutes of the Board of directors of the Bank of Russia of May 26, 2016 No. 14) establish procedure for forming, including creation, use, the size and frequency of calculation by the microfinancial organizations of reserves on possible losses on loans.

1. Reserves on possible losses on loans are created on the rights to claim of the microfinancial organization which arose from the date of entering of information about her into the state register of the microfinancial organizations, following from agreements of microloan and contracts of assignment of rights to claim under the agreements of microloan signed between borrowers and the microfinancial organizations.

2. Reserves on possible losses on loans are created by microfinance company monthly, the microcredit company quarterly as of the last date for microfinance company (quarter for the microcredit company) in the presence of not performed (completely or partially) obligations to the microfinancial organization concerning debt on microloans and on the investments in rights to claim of the microfinancial organization following from contracts of assignment of rights to claim under the agreements of microloan signed between borrowers and the microfinancial organizations (further - the acquired rights to claim under agreements of microloan), and also concerning the obligations on the re-structured microloans established by results of inventory count of debt as of the last date for microfinance company (quarter for the microcredit company). Inventory count of debt for the purpose of this Instruction the check performed by the microfinancial organization registered as of the last date for microfinance company (quarter for the microcredit company) is recognized to debt on the issued microloans and the acquired rights to claim on agreements of microloan for the purpose of identification and determination of duration of overdue payments.

3. Reserves on possible losses on loans are created:

on the amount of principal debt on microloans in which do not join: payments in the form of interest for using microloan, the commission fees, penalties, other payments for benefit of the microfinancial organization following from the agreement of microloan;

on the amount of requirements for the added interest incomes on microloans which join interest for using microloan, and also any predefined the agreement of microloan the income on microloan;

on the amount of investments of the acquired rights to claim under agreements of microloan;

on the amount of requirements for the added interest incomes on investments in the acquired rights to claim under agreements of microloan which join interest for using microloan, and also any predefined the agreement of microloan the income on microloan added by the microfinancial organization from the moment of acquisition of rights to claim by it under agreements of microloan.

4. When forming reserve on possible losses on loans regarding principal debt on microloan and regarding investments in the acquired rights to claim under agreements of microloan the microfinancial organizations create reserves on possible losses on loans in the following procedure.

4.1. The rights to claim granted by the microfinancial organization microloans and acquired under agreements of microloan are grouped in types of borrowers and unite in the following groups:

debt of the physical persons who are not individual entrepreneurs on the agreement of microloan signed for a period of up to 30 days inclusive in the amount to 30 thousand rubles inclusive (further - debt of the physical persons who are not individual entrepreneurs on short-term microloans);

other debt of the physical persons who are not individual entrepreneurs;

debt of the individual entrepreneurs and legal entities who are subjects of small and medium business;

debt of the individual entrepreneurs who are not subjects of small and medium business;

debt of the legal entities who are not subjects of small and medium business.

4.2. Restructured debt of the physical persons who are not individual entrepreneurs on short-term microloans and other restructured debt unite in separate groups. For the purposes of this Instruction the debt is recognized re-structured if the microfinancial organization, including the microfinancial organization from which passed rights to claim under agreements of microloan signed with the borrower the supplementary agreement changing essential conditions of the initial agreement of microloan based on which the borrower acquires the right to fulfill obligations on microloan in more favorable mode (for example, change of repayment period of microloan, the size of interest rate, procedure for its calculation). At the same time for reference of debt to restructured debt of the physical persons who are not individual entrepreneurs on short-term microloans or to other restructured debt initial terms of the contract of microloan regarding the amount of microloan and term for which the initial agreement of microloan, the debt on which is subject to restructuring, is signed are considered.

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