RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of August 7, 2024 No. 2024-P-17/34-2-(NPA)

About introduction of amendments to the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Licensing of Activities of Banks" of June 8, 2017 No. 2017-P-12/23-1-(NPA)

According to Articles 5, "About National Bank of the Kyrgyz Republic" the Board of National Bank of the Kyrgyz Republic decides 9 and 64 constitutional Laws of the Kyrgyz Republic:

1. Make changes to the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Licensing of Activities of Banks" of June 8, 2017 No. 2017-P-12/23-1-(NPA)" (are applied).

2. This resolution becomes effective after 15 (fifteen) days from the date of official publication.

3. To legal management:

- from the date of receipt of the relevant documents within 3 (three) working days to publish this resolution on the official website of National Bank of the Kyrgyz Republic;

- after official publication to send this resolution to the Ministry of Justice of the Kyrgyz Republic for entering into the State register of regulatory legal acts of the Kyrgyz Republic.

4. To management of licensing after official publication within 3 (three) working days to bring this resolution to the attention of commercial banks and OYuL "Union of Banks of Kyrgyzstan".

5. To department "Secretariat of Board" within 3 (three) working days to bring this resolution to the attention of legal management, management of banking supervision, management of methodology of supervision, regional managements and Representative office of National Bank of the Kyrgyz Republic in Batken Province.

6. To impose control of execution of this resolution on the vice-chairman of the National Bank of the Kyrgyz Republic supervising management of licensing.

Appendix

to the Resolution of Board of National Bank of the Kyrgyz Republic of August 7, 2024 No. 2024-P-17/34-2-(NPA)

Changes in the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Licensing of Activities of Banks" of June 8, 2017 No. 2017-P-12/23-1-(NPA)

Bring in the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Licensing of Activities of Banks" of June 8, 2017 No. 2017-P-12/23-1-(NPA)" the following changes:

in the Provision "About Licensing of Activities of Banks" approved by the above-stated resolution:

- add Item 14 with subitems 9, of 10, 11 and 12 following contents:

"9) activities of payment institutes and operators of payment system;

10) activities of the legal entities performing separate banking activities;

11) the investing activities connected with banking, financial and/or payment activity;

12) activities for management of public finances.";

- add Item 20 with the subitem 8 of the following content:

"8) Officials of bank - the chairman and board members of bank, the chairman of Committee on audit, the chairman of the Management committee risks, the chairman of the board, board members of bank, managing directors, the chairman and members of sharia council, the head of the structural unit responsible for credit activities of bank, the head of the structural unit responsible for asset-liability management of bank (or person equated to it on the functional obligations), the chief accountant, the head of the structural unit responsible for financing for the Islamic principles of banking and financing, the head of "Islamic window", the head of service of internal audit, the head of service risk management, the head of service of komplayens-control, the corporate secretary, persons equated on the functional obligations to above-mentioned officials including deputies of persons stated above, the directors and chief accountants of branches, and also persons which are determining, who are creating policy of bank and having powers to participate in the main transactions of bank irrespective of, these persons on a grant basis work or earn reward.";

- add Item 29 with the subitem of 21 following contents:

"21) the approved internal documents (politicians) regulating activities for banking activities in foreign currency, providing assessment, control and monitoring it is risk.";

- declare Item 30 invalid;

- add Item 37 with the subitem 23 following of content:

"23) the approved internal documents (politicians) regulating activities for banking activities in foreign currency, providing assessment, control and monitoring it is risk.";

- declare Item 38 invalid;

- in the second paragraph of Item 59 to exclude the words "including the means received by it within the loan agreement or means equated to it";

- add Item 61 with the paragraph of the following content:

"In subsequent in case of change of the size of the authorized capital which is not influencing threshold equity participation of bank state bodies, representatives on implementation of powers of the shareholder on behalf of the Cabinet of Ministers of the Kyrgyz Republic are limited to submission of the document confirming payment of shares on the amount of the acquired share within 10 (ten) working days from the date of transition of the property right to shares.";

- state Item 62 in the following edition:

"62. Legal put all founders (shareholders) of bank and the copy of source documents on forming of the authorized capital under organization of bank, further - in case of change of the size of the authorized capital (including copies of payment documents, the decisions concerning change of the size of the authorized capital and other documents), the number of shares and shareholding structure of bank, shall be kept by bank in the separate folder with assignment of separate nomenclature number by it and have permanent storage duration. The bank shall determine person responsible for ensuring proper forming and storage of these folders (legal cases).

Legal cases of founders (shareholders) shall contain all information provided by this Provision on acquisition of threshold equity participation of bank, and on shareholders (founders) owning less than ten percent of shares of bank information and documents according to Items 125-1 and 125-2 of this provision.";

- add Item 63 with the subitem 13 of the following content:

"13) to provide technical equipment of bank, including requirements to the equipment which shall be adequate to expected circle of the carried-out transactions.";

- the paragraph one of Item 82 to state in the following edition:

"82. The bank in the presence of transactions with precious metals in the list of the permitted banking activities to the license of bank for the right of carrying out banking activities can perform operations in cash and/or non-cash form:";

- in Item 83:

the paragraph one to state in the following edition:

"For implementation of transactions with precious metals in the form of the affined measuring ingots emitted (issued) by National Bank, banks shall fulfill the following requirements of the moment of submission of documents:";

state subitem 1 in the following edition:

"1) the sizes authorized and own (regulating) the capitals shall conform to the requirements established by the bank law of the Kyrgyz Republic;";

add with subitem 5 in the following edition:

"5) activities of bank shall be profitable.";

- add Item 113 with the subitem 8 of the following content:

"8) to the state body authorized on implementation of powers of the shareholder on behalf of the Cabinet of Ministers of the Kyrgyz Republic:

- the relevant decision of authorized body about acquisition of threshold equity participation of bank;

- data according to the questionnaire on appendix form 16 to this Provision;

- the document confirming payment of shares on the amount of the acquired share within 10 (ten) working days from the date of transition of property to shares.";

- add Item 120 with the paragraph of the following content:

"In subsequent in case of acquisition by the shareholder owning threshold equity participation of bank of the bank shares which are not reaching the following threshold, the shareholder represents to National Bank only data on sources of origin of money on acquired share and the copy of the purchase and sale agreement of shares or other document based on which passed the property right, and documents confirming the fact of payment for shares.";

- in Item 126:

state subitem 5 in the following edition:

"5) the managing director joining the board of bank, or supervising activities of structural divisions, heads whom are subject to obligatory approval;";

- add Item 126 with the subitem of the following content:

"14) corporate secretary.";

- in Item 134:

state subitem 1 in following edition:

"1) to have the diploma about the higher education and years of service (experience) of work at least three years in the field of economic, bank, financial, legal and/or questions of information technologies. At the same time candidates for positions of chairmen of management committees risks and on audit shall have years of service (experience) of work at least a year in the field of bank/financial questions;";

- To state the 7th paragraph of Item 134 in the following edition:

"At the same time most of board members, including the chairman of the board of directors, shall have length of service at least two years on executive positions in bank and/or financial systems. When calculating these years of service length of service as the board member to whom it was refused approval is not considered, or reconciliation procedure of which is not complete. If most of board members has length of service less than 2 (two) years on executive positions in bank and/or financial system National Bank of the board members of bank having the right to suspend approval who are not conforming to this requirement before reduction of its structure in compliance with the requirement stated above. At the same time the bank shall bring structure of the board of directors into accord within 1 (one) month from the date of receipt of the letter of National Bank. If at the scheduled time the bank does not create the structure of the board of directors conforming to this requirement, the National Bank makes the decision on refusal in approval of all board members whose reconciliation procedure is not complete due to the lack of necessary length of service on executive positions in bank and/or financial systems.";

- add Item 134 with the ninth paragraph of the following content:

"For ensuring goal achievement, established by the legislation, and also solutions of specifically certain tasks the National Bank has the right to make the decision on approval of one candidate (on quota of the shareholder state) to position of the board member of bank with 50 (fifty) and more percentage share of the state in the capital of the bank having qualification and competence in the directions directly necessary for execution of objectives, and conforming to requirements about availability of the higher education and subitems 2 and 5 of this Item of this provision.";

- in Item 144:

state the first paragraph in the following edition:

"144. Candidates for the positions specified in Item 126 of this provision, except for chairmen and board members, Sharia council and chairmen of Committee on audit of bank and on risk management of the corporate secretary shall conform to the following minimum requirements:";

subitem 2 to state the paragraph in the following edition:

"b) vice-chairmen (the vice-president, the deputy general manager, the deputy manager of branch of foreign bank), other board members, heads of service risk management and services of komplayens-control - at least three years in bank and/or financial system, the board member supervising activities of structural divisions of bank only for the specialized directions (questions of cyber security and information technologies, safety, legal support), shall have work experience at least 3 (three) years in bank and/or financial system and/or at least 3 (three) years in the organizations dealing with the above-stated issues;";

- add with Item 144-1 of the following content:

"144-1. The corporate secretary shall conform to the following requirements:

- availability of the higher education;

- certificate availability in the "corporate management" direction which was received within 5 (five) years preceding date of submission of the petition for approval of candidate in the educational institutions having the corresponding permission / license of authorized state body;

- not fall under conditions of Chapter 20 of this provision.";

- state Item 172 in the following edition:

"172. Foreign banks which shall correspond to one of the following credit ratings can be foreign parent (parent) bank in relation to subsidiary bank in the territory of the Kyrgyz Republic:

- long-term credit score is not lower than category "B", "Standard & Poor" of s ", " Moody "s Investors Service", "Fitch-IBCA" (USA) assigned by rating agencies;

- or equivalent the above the credit score assigned by rating agencies "Capital Intelligence", "Japan Credit Rating Agency (JCR)", "Dominion Bond Rating Service (DBRS)", "to Rating & Investment Information (R&i)";

- or equivalent the above the credit score assigned by national rating agency which obtained accreditation in authorized bodies of the country and which rating is recognized the Central (national) Bank of the country.";

- add Item 181 with the paragraph of the following content:

"Activities of branch cannot be suspended, except the cases provided by regulatory legal acts of National Bank.";

- to state the subitem 6 of Item 183 in the following edition:

"6) the business plan of branch from the point of view of influence of activities of branch for achievement of strategic objectives of bank and the predicted profitability of bank (the list of questions is given in Appendix 7);";

- state Item 186 in the following edition:

"186. After state registration of bank branch in authorized state body the bank shall provide within 5 (five) working days to National Bank the adequate written notice with appendix of the reference (certificate) on the legal entity, branch (representation), the confirmed seal of bank and the copy of the Regulations on branch with the mark about state registration confirmed by seal of bank.";

- state Item 196 in the following edition:

"196. After the state re-registration of bank branch in authorized state body the bank shall provide within 5 (five) working days to National Bank the adequate written notice with appendix of the reference (certificate) on the legal entity, branch (representation), the confirmed seal of bank and the copy of the Regulations on branch with the mark about state registration confirmed by seal of bank.";

- add Item 211 the subitem:

"211. The foreign bank opening branch in the territory of the Kyrgyz Republic shall meet the following requirements:

b) equivalent the above the credit score assigned by national rating agency which obtained accreditation in authorized bodies of the country and which rating is recognized the Central (national) Bank of the country.";

- state Item 226 in the following edition:

"226. After state registration of representative office of bank in authorized state body, the bank shall provide within five working days to National Bank the adequate written notice with appendix of the reference (certificate) on the legal entity, branch (representation), the confirmed seal of bank and the copy of the Regulations on representation with the mark about state registration confirmed by seal of bank.";

- state Item 304 in the following edition:

"304. Within 5 (five) working days from the date of receipt of the certificate on the state re-registration the bank shall provide to National Bank:

1) the copy of the reference (certificate) on the legal entity, branch (representation) certified by seal of bank;

2) the copy of new edition of the charter with mark of authorized state body on registration of legal entities about the state re-registration certified by seal of bank.";

- third the subitem 7 of Item 1.11 of Appendix 15 to state the paragraph in the following edition:

"-measures of authority punishment within the last 3 (three) years, criminal liability (yes/no) ________ are applied";

- in Appendix 17:

the paragraph one of Item 8 to state in the following edition:

"8. List commercial banks of the Kyrgyz Republic with which the applicant has correspondence relations. Specify commercial banks to which bank the applicant provides credit lines of any kinds and the amount of such credit lines.";

the paragraph one of Item 13 to state in the following edition:

"13. Provide surname, name of the head or other authorized person (in the Kyrgyz, Russian, and English languages) supervision body of country of source (registration) of bank of the applicant which can respond to the requests and provide the information concerning bank of the applicant, specify the address of its e-mail:";

to state the third paragraph of the subitem 7 of Item 16 in the following edition:

"-measures of authority punishment, criminal liability (yes/no) _______ are applied".

 

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