INSTRUCTION OF CENTRAL BANK OF THE RUSSIAN FEDERATION

of June 17, 2014 No. 154-I

About evaluation procedure of wages system in credit institution and procedure for the direction in credit institution of the instruction about elimination of violation in its wages system

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, the Art. 2311, the Art. 2317) (further - the Federal Law "About the Central Bank Russian Federation (Bank of Russia)") and the Federal Law "About Banks and Banking Activity" (in edition of the Federal Law of February 3, 1996 No. 17-FZ) (Sheets of the Congress of People's Deputies of RSFSR and the Supreme Council of RSFSR, 1990, No. 27, Art. 357; Russian Federation Code, 1996, No. 6, Art. 492; 1998, No. 31, Art. 3829; 1999, No. 28, Art. 3459, Art. 3469; 2001, No. 26, Art. 2586; No. 33, Art. 3424; 2002, No. 12, Art. 1093; 2003, No. 27, Art. 2700; No. 50, Art. 4855; No. 52, Art. 5033, Art. 5037; 2004, No. 27, Art. 2711; No. 31, Art. 3233; 2005, No. 1, Art. 18, Art. 45; No. 30, Art. 3117; 2006, No. 6, Art. 636; No. 19, Art. 2061; No. 31, Art. 3439; No. 52, Art. 5497; 2007, No. 1, Art. 9; No. 22, Art. 2563; No. 31, Art. 4011; No. 41, Art. 4845; No. 45, Art. 5425; No. 50, Art. 6238; 2008, No. 10, Art. 895; 2009, No. 1, Art. 23; No. 9, Art. 1043; No. 18, Art. 2153; No. 23, Art. 2776; No. 30, Art. 3739; No. 48, Art. 5731; No. 52, Art. 6428; 2010, No. 8, Art. 775; No. 27, Art. 3432; No. 30, Art. 4012; No. 31, Art. 4193; No. 47, Art. 6028; 2011, No. 7, Art. 905; No. 27, Art. 3873, Art. 3880; No. 29, Art. 4291; No. 48, Art. 6728, Art. 6730; No. 49, Art. 7069; No. 50, Art. 7351; 2012, No. 27, Art. 3588; No. 31, Art. 4333; No. 50, Art. 6954; No. 53, Art. 7605, Art. 7607; 2013, No. 11, Art. 1076; No. 19, Art. 2317, Art. 2329; No. 26, Art. 3207; No. 27, Art. 3438, Art. 3477; No. 30, Art. 4048; No. 40, Art. 5036; No. 49, Art. 6336; No. 51, Art. 6683, Art. 6699; 2014, No. 6, Art. 563; No. 19, of the Art. 2311, of the Art. 2317) (further - the Federal Law "About Banks and Banking Activity") establishes evaluation procedure the Bank of Russia of wages system of credit institution, and also procedure for the direction in credit institution of the instruction of the Bank of Russia about elimination of violations in wages system.

Chapter 1. General provisions

1.1. The purposes of assessment of wages system of credit institution are:

ensuring financial stability of credit institution;

ensuring compliance of wages system of credit institution to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks.

1.2. Assessment of wages system of credit institution is carried out by the structural division of the Bank of Russia exercising supervision of activities of credit institution (further - authorized structural division of the Bank of Russia), in the part connected with result of risk management as in general, and regarding compensation of persons specified in article 57.3 of the Federal law "About the Central Bank Russian Federation (Bank of Russia)".

1.3. The authorized structural division of the Bank of Russia recognizes wages system of credit institution corresponding to nature and scale of the transactions made by it, results of its activities, level and combination of the accepted risks in case of accomplishment by credit institution of the conditions specified in Chapter 2 of this Instruction taking into account the features determined by Chapter 3 of this Instruction.

Chapter 2. Conditions of compliance of wages system of credit institution to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks

2.1. The board of directors (supervisory board) of credit institution considers questions of the organization, monitoring and control of wages system, assessment of its compliance of strategy of credit institution, to nature and scale of the made transactions, results of its activities, level and combination of the accepted risks, including:

claims (approves) the documents establishing procedure for determination of the sizes of salaries (official pay rates), the compensatory, stimulating and social payments which are not connected with results of activities (further - the fixed part of compensation) sole executive body and members of collegiate executive body (further - members of executive bodies), procedure for determination of the size, forms and charge to members of executive bodies and other heads (workers) making decisions on implementation by credit institution of transactions and other transactions which results can influence observance of obligatory standard rates by credit institution or emergence of other situations menacing to interests of investors and creditors including the bases for implementation of measures for the prevention of insolvency (bankruptcy) of credit institution (further - other workers accepting risks) and also employees of the divisions exercising internal control and the divisions performing at the level of separate portfolios, activities and on credit institution in general identification and risks assessment, limiting establishment of values of risks, determination of capital need on their covering, and also control of observance of the specified restrictions (further - the divisions exercising risk management), the compensatory and stimulating payments connected with results of their activities (further - unstable part of compensation);

at least once in calendar year makes decisions on preserving or review of the documents specified in the paragraph the second this Item, depending on change of conditions of activities of credit institution, including in connection with changes of strategy of credit institution, nature and scales of the made transactions, results of its activities, level and combination of the accepted risks;

approves the size of the salary fund of credit institution;

at least once in calendar year considers offers of the divisions exercising internal control and the divisions exercising risk management concerning enhancement of wages system (in the presence of such offers) and reports of division (divisions) on which, (which) powers on monitoring of wages system are assigned;

considers independent estimates of wages system (for example, within the annual conclusion of the external auditor) and information of management committee risks (in case of its availability);

exercises control of payments of the large remunerations recognized by those according to the internal documents installing wages system, according to the procedure, established by the board of directors (supervisory board) of credit institution.

2.2. As a part of the board of directors (supervisory board) of credit institution the special body to which duties preparation of solutions of the board of directors (supervisory board) of credit institution on questions, stipulated in Item 2.1 these Instructions belongs is available and functions (for example, committee on remunerations).

2.2.1. The board members (supervisory board) of credit institution entering into the special body specified in paragraph one of this Item are not members of executive bodies of credit institution.

2.2.2. Most of the board members (supervisory board) of credit institution entering into the special body specified in paragraph one of this Item have the sufficient experience or qualification allowing them to make decisions on questions, stipulated in Item 2.1 these Instructions (in particular, have the higher legal or economic education and (or) work experience in the field of management of bank risks and the organizations of wages system).

2.3. The credit institution provides completeness of contents of its internal documents installing wages system namely:

internal documents of credit institution contain provisions according to which the size of unstable part of compensation, general on credit institution, is determined taking into account the quantitative and qualitative indexes allowing to consider all risks, significant for credit institution, and also profitability of activities of credit institution (examples of quantitative and qualitative indexes for adjustment of remunerations are given in appendix 1 to this Instruction);

internal documents of credit institution regulate all payment methods of work and payment types provided by wages system used in credit institution and also payments which in accordance with the legislation of the Russian Federation and (or) internal documents of credit institution formally do not belong to wages system are non-standard which size according to the agreements signed with employees of credit institution is not adjusted taking into account the risks accepted by credit institution (for example, compensation for expenses on housing to workers, compensation for expenses on insurance, pension assignments, other similar payments, and also the payments performed to employees of credit institution by other legal entities connected with credit institution);

internal documents of credit institution determine evaluation procedure of efficiency of the organization and functioning of wages system, and also division (divisions) on which, (which) powers on monitoring of wages system are assigned;

in internal documents of credit institution the list of the workers who are accepting risks (in addition to members of executive bodies of credit institution), including including the employees of credit institution specified in appendix 2 to this Instruction is determined.

2.4. In case of determination of the amount of compensation of employees of credit institution levels of risks to which is exposed are considered the credit institution as a result of their actions (underwent), including:

for the divisions of credit institution performing transactions (transaction) bearing risks (on activities), calculation of unstable part of compensation is made taking into account the quantitative indices characterizing the risks accepted by credit institution within activities of these divisions and the planned profitability of these transactions (transactions), sizes of own means necessary for covering of the accepted risks, amount and cost of the borrowed and other raised funds necessary for covering of unexpected liquidity deficit;

for members of the executive bodies and other workers accepting risks when calculating target indicators of remunerations (before adjustments) for the planned period at least 40 percent of the general amount of remunerations are constituted by unstable part of compensation which is determined depending on post and level of responsibility;

by internal documents of credit institution it is provided and applied to the members of executive bodies and other workers accepting risks, delay (payment by installments) and the subsequent adjustment at least 40 percent of unstable part of compensation proceeding from dates of receipt of financial results of their activities (for the term of at least 3 years, except for transactions which final financial results are determined earlier specified term), including possibility of reducing or cancellation of unstable part of compensation in case of receipt of negative financial result in general on credit institution or on the corresponding activity (including by determination of the amount of payments within unstable part of compensation and their charge after the periods sufficient for determination of results of activities);

by internal documents of credit institution it is provided and applied to the members of executive bodies and other workers accepting risks, combination of the cash and non-cash payment method of work sensitive to results of activities and level of the risks accepted by credit institution (in case of lack of the corresponding non-cash payment method of work contracts with workers provide adjustment of the delayed (spread) part of remunerations taking into account change in value of shares (financial instruments, derivative of them) of credit institution for the dates provided by wages system);

the condition of the paragraph of the fifth this Item is not applied to the credit institution created in the form of limited liability company and also if the current (fair) share value (financial instruments, derivative of them) of credit institution cannot be determined proceeding from market quotations or indication prices (quotations) provided by brokers and (or) the price services having the corresponding qualification and experience in determination of the prices (quotations) of financial instruments.

2.5. Activities specified in subitems 2.2.1 - 2.2.3 Items 2.2 of the Provision of the Bank of Russia of December 16, 2003 No. 242-P "About the organization of internal control in credit institutions and banking groups", No. registered by the Ministry of Justice of the Russian Federation on January 27, 2004 5489, on December 22, 2004 No. 6222, on March 20, 2009 No. 13547, of June 30, 2014 No. 32913 ("the Bulletin of the Bank of Russia" of February 4, 2004 No. 7, of December 31, 2004 No. 74, of April 1, 2009 No. 21, of July 9, 2014 No. 63), the divisions exercising internal control and the divisions exercising risk management (in the absence of separate structural division - activities of the employees of credit institution having the corresponding functions on risk management), are organized properly, including:

the divisions exercising internal control, and the divisions exercising risk management develop within the competence offers and (or) recommendations about the indicators used for delay (payment by installments) and adjustment of payments within unstable part of compensation and also about enhancement of the documents of credit institution installing wages system depending on results of activities of credit institution taking into account the level of the risks accepted by credit institution, its divisions and workers and also changes of strategy of credit institution, nature and scale of its activities;

independence of the size of the salary fund of the divisions exercising internal control, and the divisions exercising risk management, from financial result of structural divisions (bodies) making decisions on making of banking activities and other transactions is provided;

in wages system quality of accomplishment by employees of the divisions exercising internal control and the divisions exercising risk management, tasks, assigned to them by regulations (similar internal documents) on the relevant divisions of credit institution is considered;

in total amount of the remunerations paid to employees of the divisions exercising internal control and the divisions exercising risk management, the fixed part of compensation constitutes at least 50 percent.

2.6. The credit institution brings to the attention all employees of credit institution under the signature the documents of credit institution installing wages system and also strictness of observance of their provisions is provided.

2.7. The bank with the basic license, non-bank credit institution in accordance with the established procedure provides disclosure of information provided by subitem 10.3 of Item 10 of appendix to the Instruction of the Bank of Russia of December 6, 2017 No. 4638-U "About forms, procedure and terms of disclosure by credit institutions of information on the activities", to No. 49423 registered by the Ministry of Justice of the Russian Federation on December 25, 2017.

The bank with the universal license provides disclosure of information on wages system according to the Section XII of appendix to the Instruction of the Bank of Russia of August 7, 2017 to No. 4482-U "About form and procedure for disclosure by credit institution (parent credit institution of banking group) of information on the accepted risks, procedures of their assessment, risk management and the capital", to No. registered by the Ministry of Justice of the Russian Federation on November 1, 2017 48769, on June 29, 2018 No. 51480.

Chapter 3. Features of assessment of conformity of wages system of credit institution to nature and scale of the transactions made by it, results of its activities, level and combination of the accepted risks for separate credit institutions

3.1. In case of assessment of conformity of wages system of credit institution to nature and scale of the transactions made by it, results of its activities, level and combination of the accepted risks the authorized structural division of the Bank of Russia considers the features specified in Items 3.2 and 3.3 of this Instruction.

3.2. Concerning credit institution which size of assets did not exceed 50 billion rubles and (or) the size of the funds raised from physical persons based on bank deposit agreements and bank account agreements did not exceed 10 billion rubles, in case of decision making about compliance of wages system to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks the authorized structural division of the Bank of Russia is guided by the following.

3.2.1. The condition of Item 2.2 of this Instruction is considered executed if functions on preparation of solutions of the board of directors (supervisory board) of credit institution on questions, stipulated in Item 2.1 these Instructions, are assigned to the specific board member (supervisory board) of credit institution which is not the member of executive bodies of credit institution or to the special body created as a part of the board of directors (supervisory board) of credit institution, specified in paragraph one of Item 2.2 of this Instruction.

3.2.2. Conditions of paragraph two of Item 2.3 and paragraph two of Item 2.4 of this Instruction are considered executed if the credit institution for adjustments of unstable part of compensation at the level of credit institution in general, at the level of divisions (activities) and at the level of certain employees uses the quantitative and (or) qualitative indexes characterizing profitability and the accepted risks.

3.2.3. The condition established by the paragraph the fifth Item 2.4 of this Instruction is not applied.

3.3. Assessment of wages system of credit institution which size of assets exceeded 50 billion rubles and (or) the size of the funds raised from physical persons based on bank deposit agreements and bank account agreements exceeded 10 billion rubles, it is performed according to Chapter 2 of this Instruction after six months from the date of such exceeding.

Chapter 4. Procedure for acceptance by authorized structural division of the Bank of Russia of the decision on compliance of wages system of credit institution to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks and applications of corrective actions

4.1. The authorized structural division of the Bank of Russia estimates wages system of credit institution as of October 1 of the current calendar year.

4.2. Authorized structural divisions of the Bank of Russia perform monitoring of wages systems of credit institutions. If within monitoring of wages system of credit institution discrepancy of wages system of credit institution to nature and scale of the transactions made by it comes to light, to results of its activities, level and combination of the accepted risks, that authorized structural division of the Bank of Russia makes the actions specified in Items 4.4 and 4.5 of this Instruction no later than 5 calendar days from the moment of emergence of the corresponding bases.

4.3. In case of assessment of wages system of credit institution the authorized structural division of the Bank of Russia considers the documents determining policy and wages system of credit institution:

charter of credit institution and regulations on the board of directors (supervisory board) of credit institution;

the internal documents determining policy of credit institution in the field of compensation, approved by the board of directors (supervisory board) of credit institution according to Item 3 of article 11.1-1 of the Federal law "About Banks and Banking Activity";

the collective agreement (or the local regulation determining wages system of credit institution);

the employment contracts signed with persons specified in the paragraph the second Item 2.1 of this Instruction; the agreements with employees of credit institution providing receipt of material benefit by them (agreements of pension insurance, credit agreements, agreements on compensation for expenses on housing, on training and other similar agreements);

the agreements providing obtaining by persons specified in the paragraph the second Item 2.1 of this Instruction, remunerations from other members of banking group;

regulations on (supervisory board) of credit institution created as a part of the board of directors committee on remunerations (in the presence of such committee);

regulations on service of internal audit, service of internal control, service of risk management;

protocols of meetings of governing bodies of credit institution concerning payments of remunerations;

the internal documents of credit institution establishing procedure and criteria of determination of other workers accepting risks, either groups of such workers, or the list of such workers;

orders on payment of remunerations;

annual statement of credit institution;

report of the issuer of securities;

other documents necessary for assessment of wages system of credit institution.

The credit institution shall provide at the request of authorized structural division of the Bank of Russia of the copy of the specified documents (in case of their absence) within 10 working days from the date of receipt of such request by credit institution.

The inquiry is sent by the head (deputy manager) of authorized structural division of the Bank of Russia or persons replacing them.

The inquiry is not sent if the documents specified in this Item were submitted to authorized structural division of the Bank of Russia current calendar year and there is written confirmation of credit institution that changes were not made to them.

The Bank of Russia provides confidentiality of information on their wages systems which arrived from credit institutions according to requirements of the Federal Laws.

4.4. The authorized structural division of the Bank of Russia sends to credit institution information on discrepancy of its wages system to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks within assessment of economic situation and financial condition of credit institutions.

The credit institution in case of disagreement with discrepancy of wages system of credit institution to nature and scale of the transactions made by it, to results of its activities, level and combination of the accepted risks has the right to provide to authorized structural division of the Bank of Russia motivated objection within 10 working days from the date of receipt by credit institution of information on assessment of wages system.

The authorized structural division of the Bank of Russia shall consider motivated objection of credit institution no more than 10 working days from the date of its obtaining in time.

4.5. If the credit institution did not send to authorized structural division of the Bank of Russia motivated objection in time, stipulated in Item 4.4 these Instructions, or by results of consideration of the motivated objection by authorized structural division of the Bank of Russia directed by credit institution assessment of wages system of credit institution about discrepancy of wages system of credit institution to nature and scale of the transactions made by it is not changed, to results of its activities, level and combination of the accepted risks, including absence in policy of credit institution regarding compensation of conditions about delay (payment by installments) and about the subsequent adjustment of the sizes of unstable part of compensation to the members of executive bodies and other workers accepting risks proceeding from terms of realization of results of their activities, including possibilities of reducing or cancellation of payments in case of negative financial result in general on credit institution or in the corresponding direction it activities, the authorized structural division of the Bank of Russia no later than 30 working days from the date of the direction in credit institution of information on discrepancy of its wages system to nature and scale of the transactions made by it, sends to results of its activities, level and combination of the accepted risks to credit institution the instruction about elimination of the corresponding violation.

4.6. In case of non-execution in the time of the instruction of the Bank of Russia established by authorized structural division of the Bank of Russia about elimination of the violations revealed in wages system of credit institution, the Bank of Russia has the right to apply to such credit institution of measure, the stipulated in Clause 74 Federal Laws "About the Central Bank Russian Federation (Bank of Russia)".

Chapter 5. Final provisions

5.1. This Instruction is subject to official publication in "the Bulletin of the Bank of Russia" 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 No. 17) become effective of 29.05.2014 since January 1, 2015.

Appendix 1

to the Instruction of the Bank of Russia of June 17, 2014 No. 154-I "About evaluation procedure of wages system in credit institution and procedure for the direction in credit institution of the instruction about elimination of violation in its wages system"

Examples of quantitative and qualitative indexes for adjustment of remunerations

Indicators	Quantitative		High-quality
Level	Risks	Profitability	Risks	Profitability
1	2	3	4	5
Credit institution in general	Aggregative risks assessment (the capital on their covering) with use of internal techniques of credit institution; Negative yield of investments in the share of credit institution for accounting year.	The planned profitability of the capital; The planned return on assets.	Independent estimates of financial stability of credit institution; Change of competitive line item of credit institution in the market.	Stability of the income in general on credit institution, including: in comparison with the previous accounting periods; share of the income from one-time transactions <1> in the total value of the income of credit institution.
Divisions (activity), employees	Risks assessment (the capital on their covering) with use of internal methods of credit institution of banking activities or other transactions, committed division or the employee; Amount of the possible losses caused by instability of the sources of financing attracted with division or the employee (short terms of their attraction, possibility of their early withdrawal by creditors, excess of cost of attraction of financial resources over market indicators on similar sources of financing).	The planned profitability of the banking activities or other transactions made by division or the employee.	Violation of the law of the Russian Federation and requirements of regulations of the Bank of Russia, internal procedures of credit institution; Violations of procedure for conducting financial accounting or provision of unreliable information about activities of division; Adjustments on error of evaluation methods of the risks applied on banking activities or other transactions, committed division or the employee; Growth (decrease) of number of claims and customer complaints on banking activities or other transactions, committed division or the employee.	Stability of the income on banking activities or other transactions, committed division or the employee.

--------------------------------

<1> The other incomes connected with transactions on ensuring activities of credit institution (result on symbols of 29401 - 29407 forms of the reporting 0409102 "The report on financial results of the credit institution" filled according to the Instruction of the Bank of Russia of April 10, 2023 No. 6406-U "About forms, terms, procedure for creation and submission of the reporting of credit institutions (banking groups) to the Central bank of the Russian Federation, and also of the list of information on activities of credit institutions (banking groups)" (it is registered by the Ministry of Justice of the Russian Federation on August 16, 2023, registration No. 74823) (further - form 0409102), and also penalties (penalties, penalty fee) on other banking activities and transactions (symbol 28402 forms 0409102) and other income from disposal (realization) of property, fixed assets, intangible assets, other property (symbols of 29101 - 29103 forms 0409102).

Appendix 2

to the Instruction of the Bank of Russia of June 17, 2014 No. 154-I "About evaluation procedure of wages system in credit institution and procedure for the direction in credit institution of the instruction about elimination of violation in its wages system"

The list of the employees of credit institution accepting risks

№ of payment order	The operations and transactions performed by credit institution	Workers
	1	2
1.	Placement of money on its own behalf and at own expense, placement of precious metals, acquisition of right of the requirement from the third parties of obligation fulfillment in cash, issue of bank guarantees, guarantees for the third parties providing obligation fulfillment in cash.	The heads and other employees of divisions (activities) making independent decisions (including as a part of collegiate organs) about essential conditions of the operations performed by credit institution and other transactions.
2.	Attraction of money of physical persons and legal entities in currency of the Russian Federation, in foreign currency, attraction in deposits of precious metals.	Division managers (activities).
3.	Purchase and sale of foreign currency in non-cash form.	The division manager (activities) and other employees of division (activity) making independent decisions (including as a part of collegiate organs) about essential conditions of the operations performed by credit institution and other transactions.
4.	Purchase and sale of foreign currency in cash form.	Division manager (activities).
5.	Trust management of money and other property under the contract with physical persons and legal entities.	Division manager (activities).
6.	Broker activities.	Division manager (activities).
7.	Dealer activities.	The head and other employees of division (activity) making independent decisions (including as a part of collegiate organs) about essential conditions of the operations performed by credit institution and other transactions.

 

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