Decision on Supervision over Implementation of Law on Conversion of Swiss Franc Loans to Euro

Pursuant to Article 44 paragraph 2 point 3 of the Central Bank of Montenegro Law (OGM 40/10, 46/10, 06/13) and Article 5 paragraph 2 of the Law on the Conversion of Swiss Franc (CHF) – Denominated Loans into Euro (EUR) – Denominated Loans (OGM 46/15), the Council of the Central Bank of Montenegro, at its meeting held on 26 August 2015, passed the following DECISION on the supervision over the implementation of the Law on the Conversion of Swiss Franc (CHF) – Denominated Loans into Euro (EUR) – Denominated Loans Article 1 This Decision shall govern the supervision over the implementation of the Law on the Conversion of Swiss Franc (CHF) – Denominated Loans into Euro (EUR) – Denominated Loans OGM 46/15) – (hereinafter: the Law) performed by the Central Bank of Montenegro (hereinafter: the Central Bank). Article 2 The Central Bank shall supervise the implementation of the Law as follows:

1. Analyse the documentation, information and other data submitted by banks upon the Central Bank’s request,

1. On-site review of the business books, agreements made in accordance with Article 4 of the Law, accounting and other documentation in the bank. Article 3 During the supervision over implementation of the Law, the Central Bank shall control whether the banks comply with Articles 1 through 4 of the Law, and in particular, whether the banks:

1. comply with deadlines set forth in Articles 2 and 4 of the Law;
2. for the purposes of the preparation of agreements referred to in Article 4 of the Law, convert loans in Swiss franc as at the conclusion of the loan agreement and apply middle exchange rate of euro, using the exchange rate published by the Central Bank;
3. report, in the proposals of the agreements referred to in Article 4 of the Law, obligations of the loan beneficiaries in euros;
4. present, together with the proposals of the agreements referred to in Article 4 of the Law, new repayment plan drawn up based on the new calculation of loan with calculated nominal interest rate that does not exceed 8.2% at annual level;
5. report in their business books, in accordance with the Law, the converted amount of obligations only for loan beneficiaries with whom they signed the agreements referred to in Article 4 of the Law. Article 4 The Central Bank shall supervise the implementation of the Law and take measures against banks for removing irregularities disclosed in executing the obligations under the Law in accordance with the provisions of the law governing the banking supervision.

Article 5 The Central Bank shall, within 60 days upon the expiry of the deadline referred to in Article 4 of the Law, submit to the Parliament of Montenegro the report on the supervision over the implementation of the Law containing the following:

1. information on the realisation of the obligation of banks and the Central Bank referred to in the Law;
2. data on potential measures taken against banks to remove regularities disclosed in the implementation of the Law;
3. effects of the implementation of the Law (data on offered and signed agreements, the volume of converted receivables, effects of the implementation of the Law on loan beneficiaries and banks, and the like),
4. other data and information with regard to the realisation of obligations under the Law. Article 6 This Decision shall enter into force on the eighth day following that of its publication in the Official Gazette of Montenegro. THE COUNCIL OF THE CENTRAL BANK OF MONTENEGRO CHAIRMAN G O V E R N O R, Decision no. 0101-4014/75-2 Podgorica, 26 August 2015 Milojica Dakić, m.p.