RESOLUTION OF BOARD OF THE NATIONAL BANK OF UKRAINE

of December 21, 2020 No. 160

About approval of Rules of work of banks of Ukraine in connection with establishment of quarantine and introduction of rationing anti-epidemic arrangements for the purpose of prevention of spread of koronavirusny disease of COVID-19 and modification of some regulatory legal acts of the National Bank of Ukraine

According to Articles 7, 15, 56 Laws of Ukraine "About the National Bank of Ukraine", to Articles 44, 49, 66 Laws of Ukraine "About banks and banking activity", for the purpose of prevention of distribution in the territory of Ukraine sharp respiratory disease of COVID-19, of SARS-CoV-2, caused by coronavirus in connection with establishment by the resolution of the Cabinet of Ministers of Ukraine of December 9, 2020 No. 1236 "About establishment of quarantine and introduction of rationing anti-epidemic arrangements for the purpose of prevention of distribution in the territory of Ukraine sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" quarantine by prolongation of action of the quarantine established by resolutions of the Cabinet of Ministers of Ukraine of March 11, 2020 No. 211 "About prevention of distribution in the territory of Ukraine of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes), of May 20, 2020 No. 392 "About establishment of quarantine for the purpose of prevention of distribution in the territory of Ukraine of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes) and of July 22, 2020 No. 641 "About establishment of quarantine and introduction of the strengthened anti-epidemic measures in the territory with considerable spread of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes), for minimization of negative impact of quarantine restrictions for bank system, financial stability and economy of Ukraine the Board of the National Bank of Ukraine DECIDES:

1. Approve Rules of work of banks of Ukraine in connection with establishment of quarantine and introduction of rationing anti-epidemic arrangements for the purpose of prevention of spread of koronavirusny disease of COVID-19 (further - Rules) which are applied.

2. In paragraph three of the subitem 1 of Item 1 of the resolution of Board of the National Bank of Ukraine of August 18, 2020 "About features of accomplishment of some requirements of regulatory legal acts of National Bank concerning assessment of credit risk" figures and the word "February 28" to replace No. 118 with figures and the word "April 30".

3. Recognize invalid:

1) the resolution of Board of the National Bank of Ukraine of March 26, 2020 No. 39 "About features of application of requirements of the Regulations on determination by banks of Ukraine of the extent of credit risk for active banking activities in connection with introduction of restrictive actions";

2) the resolution of Board of the National Bank of Ukraine of April 3, 2020 No. 46 "About features of application of requirements of separate regulatory legal acts and modification of some regulatory legal acts of the National Bank of Ukraine in connection with establishment of quarantine and introduction of restrictive actions";

3) the resolution of Board of the National Bank of Ukraine of July 24, 2020 No. 105 "About introduction of amendments to the resolution of Board of the National Bank of Ukraine of March 26, 2020 No. 39";

4) the resolution of Board of the National Bank of Ukraine of September 2, 2020 No. 128 "About introduction of amendments to the resolution of Board of the National Bank of Ukraine of April 3, 2020 No. 46";

5) the resolution of Board of the National Bank of Ukraine of November 19, 2020 No. 147 "About introduction of amendments to the resolution of Board of the National Bank of Ukraine of April 3, 2020 No. 46";

6) the resolution of Board of the National Bank of Ukraine of November 30, 2020 No. 152 "About introduction of amendments to the resolution of Board of the National Bank of Ukraine of April 03, 2020 No. 46".

4. To department of methodology of regulation of activities of banks (Natalya Ivanenko) after official publication to inform banks of Ukraine information on adoption of this resolution.

5. The resolution becomes effective from the date of, its official publication following behind day.

Approved by the Resolution of Board of the National Bank of Ukraine of December 21, 2020 No. 160

Rules of work of banks of Ukraine in connection with establishment of quarantine and introduction of rationing anti-epidemic arrangements for the purpose of prevention of spread of koronavirusny disease of COVID-19

1. These Rules establish features of application by banks of Ukraine (further - banks) requirements of separate regulatory legal acts of the National Bank of Ukraine in the conditions of the quarantine established by the resolution of the Cabinet of Ministers of Ukraine of December 9, 2020 No. 1236 "About establishment of quarantine and introduction of rationing anti-epidemic arrangements for the purpose of prevention of distribution in the territory of Ukraine of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" which extended action of the quarantine established by resolutions of the Cabinet of Ministers of Ukraine of March 11, 2020 No. 211 "About prevention of distribution in the territory of Ukraine of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes), of May 20, 2020 No. 392 "About establishment of quarantine for the purpose of prevention of distribution in the territory of Ukraine sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes) and of July 22, 2020 No. 641 "About establishment of quarantine and introduction of the strengthened anti-epidemic measures in the territory with considerable spread of sharp respiratory disease of COVID-19, of SARS-CoV-2 caused by coronavirus" (with changes) (further - quarantine restrictions).

2. Banks during application of requirements of the Regulations on determination by banks of Ukraine of the extent of the credit risk for active banking activities approved by the resolution of Board of the National Bank of Ukraine of June 30, 2016 No. 351 (with changes) (further - No. Provision 351):

1) till April 29, 2021 during determination of class of debtors/partners is not applied by requirements:

Item 6 of the Section I of the Provision No. 351 regarding use of information which is available in the Credit register of the National Bank of Ukraine;

subitem 7 of Item 22 of the Section II, subitem 6 of Item 59 of the Section IV, subitem 5 of Item 67-3 of the Section IV-1, of the subitem 5 of Item 79 of the Section V, subitem 4 of Item 96 of the Section VII, subitem 4 of Item 106 of the Section IX, subitem 4 of Item 132 of the Section XI, subitem 6 of Item 156 of the Section XVI of the Provision No. 351;

2) till March 30, 2021 stop counting of time for determination of frequency of implementation by bank determined in subitems 2 and 4 of Item 107 of the Section X of the Provision No. 351 of revaluation and verification of presence and fortune of the property which is come into in pledge/providing based on the right of confidential property / asset transferred by bank to financial leasing (lease) which is considered as pledge. The bank continues counting of the terms specified in subitems 2 and 4 of Item 107 of the Section X of the Provision No. 351 since March 31, 2021 taking into account time which passed till March 12, 2020;

3) till July 1, 2022 apply measure value "short-term and long-term obligations [ф. 1 (page 1510 + page 1515 + page 1600 + page 1610 - page 1165 гр. 4) or t. the 1st (1-ts) (page 1595 + page 1600 + page 1610 - page 1165 гр. 4)] in operating profit (loss) to depreciation deduction [ф. 2 (page 2190 - page 2195 + page 2515 гр. 3)] / operating profit (loss) from sales of products (goods, works, services) [ф. the 2nd (2 ms) (page 2000 - page 2050 гр. 3)] for the end of the last accounting period", Item 162 of the Section XVII of the Provision No. established in the subitem 4 351, - more than 7;

4) is not applied by the signs determined in subitems 2, of the 10 and 18 Item 165, subitems 1 - 4 Items 166 of the Section XVIII of the Provision No. 351, during determination of class of debtors/partners (except debtors/partners whose class taking into account requirements of Items 24 - the 26th Section II of Provisions No. 351 is determined by bank as of December 1, 2020 on 10, 2 and 5) with conditions of the agreements signed with debtors/partners to whom the changes connected with debt restructuring in case of simultaneous observance of the following conditions are made:

the necessity of debt restructuring is caused by financial difficulties of the debtor/partner owing to introduction of quarantine restrictions;

debt restructuring of debtors/partners is performed by bank during the period since March 12, 2020 to:

On April 30, 2021 (inclusive) - concerning debtors - physical persons;

On May 31, 2021 (inclusive) - concerning debtors/partners - legal entities;

the bank based on judgment proved feasibility of implementation of long-term debt restructuring, based on assessment of capability of the debtor/partner to overcome financial difficulties, to recover debt servicing and its repayment (in the temporary horizon determined by restructuring conditions);

the changes connected with debt restructuring do not lead to reduction of the amount of the net present value of the expected cash flows on asset calculated according to regulatory legal acts of the National Bank of Ukraine concerning financial accounting:

it is more than for 10% in comparison with the amount determined under the terms of the agreement existing as of March 28, 2020 - on the restructurings which are carried out about day of entry into force of these rules;

more than for 1% in comparison with the amount determined under the terms of the agreement existing on the date of entry into force of these rules - on the restructurings which are carried out from the date of entry into force of these rules;

5) No. 66 is excluded according to the Resolution of Board of the National Bank of Ukraine of 11.05.2023

6) till January 4, 2023 during application of Item 94 of the Section VII of the Provision No. 351 determine the debtor's class - budgetary institution without the characteristic of the actual accomplishment of revenues of the budget from planned during 2020 and 2021.

3. No. 66 is excluded according to the Resolution of Board of the National Bank of Ukraine of 11.05.2023

4. No. 66 is excluded according to the Resolution of Board of the National Bank of Ukraine of 11.05.2023

5. Banks and other persons who file documents to the National Bank of Ukraine during action of quarantine have the right not to submit documents on papers on condition of submission of these documents or their electronic copies means of e-mail of the National Bank of Ukraine with imposing on them the qualified digital signature.

6. Banks during application of requirements of the Regulations on the organization of the process of management of troubled assets in banks of Ukraine approved by the resolution of Board of the National Bank of Ukraine of July 18, 2019 No. 97 (with changes) (further - No. Provision 97), during action of quarantine:

1) is considered by regulations of Item 2 of these rules;

2) are applied to debtors/partners who correspond to the criteria and conditions established to vpodpunkta 4 Items 2 of these rules, instruments of long-term restructuring without transfer of debt of debtors/partners to divisions on work with dormant assets;

3) have the right to determine and establish in the strategy of management of troubled assets the target objective of the idle credits for 2021 (which determination is provided in Item 36 of the Section IV of Provisions No. 97) taking into account the expected economic effects of quarantine restrictions in the short-term period.

7. It is recommended to banks during implementation of restructuring of the credits:

1) to carry out restructuring of the credits only to those borrowers who incurred financial difficulties because of quarantine restrictions and are not capable to service the credits in time;

To receive 2) from clients - legal entities confirmation of the facts of essential temporary decrease in the income or termination of work;

3) to determine conditions and term of restructuring of the credits taking into account financial condition of borrowers, economic aspects of their activities, including vulnerability of their financial condition as a result of deterioration in economic situation;

4) to determine restructuring conditions which shall not: worsen conditions for the borrower;

lead to increase in effective interest rate;

5) to avoid establishment of the explicit or hidden commissions for carrying out restructuring which necessity is caused by introduction of quarantine restrictions;

6) to provide the weighed approach in case of determination of conditions of restructuring which shall mitigate, on the one hand, influence of effects of introduction of quarantine restrictions for financial condition of the borrower, and with another - not to create risks of loss by bank of the capital;

7) to inform clients on possibility of restructuring of the credits any convenient for bank and the borrower by method with indication of restructuring conditions;

8) to provide, whenever possible, provision/document creation for carrying out restructuring, giving preference to use of remote communication channels;

9) to carry out restructuring of the credits to medium and large business using individual approach and taking into account the last financial reporting of borrowers, their current financial status, vulnerability to deterioration in economic situation, and also realness of perspectives of recovery of their capability timely and in full to service the re-structured credits.

8. Banks during application of requirements of the Regulations on plans of the renewal of activities of banks and banking groups approved by the resolution of Board of the National Bank of Ukraine of July 18, 2019 No. 95 (further - No. Provision 95):

1) no later than March 01, 2021 is represented to the National Bank of Ukraine in the test mode by the plans of recovery of activities developed in 2020 taking into account the carried-out stress testing according to requirements of the Section V of the Provision No. 95 using only one stress scenario which assumes long negative economic effect of distribution in the territory of Ukraine of sharp respiratory disease of COVID-19, but without the list of critical functions which determination is provided in the subitem 2 of Item 25 of the Section IV of Provisions No. 95;

2) is given to the National Bank of Ukraine by plans of the recovery of activities in electronic form signed by the qualified electronic signature(s) of corresponding authorized person (persons);

3) in case of obtaining from the National Bank of Ukraine of the letter with indication of the list of the shortcomings revealed by results of consideration of the plans of recovery of activities provided according to the subitem 1 of Item 8 of these rules measures for non-admission of such shortcomings in case of plan development of recovery of activities in 2021 are taken;

4) no later than December 31, 2021 is represented to the National Bank of Ukraine by the plans of recovery of activities developed in 2021 taking into account the carried-out stress testing according to requirements of the Section V of the Provision No. 95 using:

for banks which received the status systemically of important bank, - two stress scenarios: combined (most tough) stress scenario and stress scenario, determined by the National Bank of Ukraine;

for banks which did not acquire the status systemically important bank, - combined (most tough) stress scenario;

5) in case of obtaining from the National Bank of Ukraine of the letter with indication of the list of the shortcomings revealed by results of consideration of the plans of recovery of activities provided according to the subitem 4 of Item 8 of these rules measures for non-admission of such shortcomings in case of plan development of recovery of activities in 2022 are taken.

 

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