Regulatory Alerts2006-03-02 | 124479Procedure for Applying Special Classification of Loans Meeting Certain Criteria
The National Bank of the Kyrgyz Republic mandates a special classification framework for loans meeting specific criteria, including a maximum principal of 500,000 som, a term not exceeding 24 months, and regular monthly repayments. Financial institutions must apply tiered provisioning rates ranging from 2% to 100% based on payment delinquency days, enforce cross-default and worst-case classification rules for joint liability groups, and downgrade restructured loans by at least one category after two restructurings. The regulation also grants exemptions from worst-case classification and provisioning downgrades during documented states of emergency or pandemics, while requiring monthly reporting, board-level approval, and strict internal controls over pre-loan assessment and post-loan monitoring.