Regulation on the Liquidation of Banks

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Date of creation: 2025-11-27

Appendix to the Resolution of the Board of the National Bank of the Kyrgyz Republic of June 8, 2017 No. 2017-P-12/23-5-(NPA)

REGULATION

on the liquidation of banks

(As amended by the Resolutions of the Board of the National Bank of the Kyrgyz Republic of April 10, 2019 No. 2019-P-12/19-1, April 24, 2019 No. 2019-P-12/22-4, July 14, 2021 No. 2021-P-12/38-3, December 28, 2022 No. 2022-P-12/83-6, May 15, 2024 No. 2024-P-12/22-1, October 8, 2025 No. 2025-P-12/50-4-(NPA), November 12, 2025 No. 2025-P-12/60-4-(NPA))

Chapter 1. General Provisions

1. This Regulation establishes qualification and other requirements for liquidators, as well as the specifics of implementing measures for the liquidation of banks in accordance with the Law of the Kyrgyz Republic "On Banks and Banking Activity" (hereinafter - the Law) and other normative legal acts of the Kyrgyz Republic.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

2. The action of this Regulation extends to all banks, microfinance companies attracting deposits, credit unions having a license to attract deposits from their participants, and branches of foreign banks (hereinafter - bank/banks).

Chapter 2. Bank Liquidators

3. A liquidator of a bank may be a person who meets the qualification and other requirements established for a bank liquidator.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of July 14, 2021 No. 2021-P-12/38-3)

4. The following persons cannot act as a liquidator of a bank:

• who is an interested party in relation to the debtor, creditors, officials and/or shareholders of the bank;
• having an unexpunged (unsuspended) criminal record;
• against whom procedures applied in bankruptcy cases have been introduced;
• against whom there is a restriction/prohibition on carrying out activities related to the management of affairs and/or property of other persons;
• against whom there is a legally effective court decision/other document in accordance with the legislation of the Kyrgyz Republic prohibiting holding the position of liquidator for a certain period.

5. A bank liquidator must meet the following qualification requirements:

• higher education;

• experience in participating in the liquidation of at least two legal entities;

• knowledge of the legislation of the Kyrgyz Republic on bankruptcy, including the bankruptcy of banks;

• (paragraph lost force in accordance with the Resolution of the Board of the National Bank of the Kyrgyz Republic of April 24, 2019 No. 2019-P-12/22-4)

• if the liquidator is a legal entity/individual entrepreneur, such person must not have been in the process of bankruptcy for five years prior to their appointment.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of April 24, 2019 No. 2019-P-12/22-4)

6. Depending on the size of the bank subject to liquidation and the features of its activity, the National Bank of the Kyrgyz Republic (hereinafter - the National Bank) may, upon revocation of the license, establish additional requirements for the bank liquidator.

7. The decision on the selection of a bank liquidator is made by the Board of the National Bank when considering the issue of revoking the license, based on a list of persons prepared by the responsible structural unit of the National Bank who meet the requirements of this Regulation and have agreed in writing to perform the functions of liquidator. In the event of receiving a petition for revocation of the license and the commencement of the procedure for voluntary liquidation of the bank, the candidate for liquidator is submitted together with the petition of the bank's shareholders. In the event that the National Bank does not approve the candidate for liquidator proposed by the bank, the National Bank has the right to appoint another liquidator.

8. When making a decision on the selection of a bank liquidator, the liquidator's work experience, business reputation, and other circumstances indicating/characterizing the candidate's ability to properly perform the obligations imposed on them and ensure the protection of creditors' interests are taken into account.

9. Remuneration for the liquidator is established by the court upon the proposal of the National Bank or by the shareholders' meeting (in the case of voluntary liquidation) in agreement with the National Bank, proportionate to the complexity of the bank being liquidated, but may not exceed the official salary of the Chairman of the Board of the liquidated bank, calculated for the last year preceding the introduction of the Temporary Administration or the revocation of the license, or the size of the remuneration of the Temporary Administrator acting in the bank on the date of the decision on the liquidation of the bank.

The liquidator establishes remuneration for hired employees at a size not exceeding the official salaries of the corresponding employees of the bank that were in effect before the introduction of the Temporary Administration or the revocation of the license.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of April 10, 2019 No. 2019-P-12/19-1)

9-1. In cases where the bank lacks liquid funds to cover administrative expenses during the procedure for the compulsory liquidation of the bank, such expenses may be incurred at the expense of the National Bank's own funds upon a reasoned request from the bank's liquidator. The liquidator attaches to the reasoned request the types of administrative expenses that will be incurred at the expense of the National Bank's funds.

The National Bank considers the liquidator's request within 30 working days from the date of receipt of the request.

When providing funds to the liquidator for administrative expenses, the National Bank establishes the types of administrative expenses that may be incurred at the expense of the National Bank's funds and the amount of funds allocated for each type of administrative expense.

The decision to provide funds to the liquidator for administrative expenses is made by the Board of the National Bank.

The National Bank provides funds to cover administrative expenses based on a contract concluded with the bank's liquidator.

The National Bank transfers funds for the liquidation procedure of the bank to a special account opened by the liquidator, in accordance with Article 115 of the Law.

Funds provided by the National Bank to the bank's liquidator for administrative expenses do not form part of the liquidation mass and are classified as administrative expenses of the liquidator in accordance with Articles 116 and 121 of the Law, and must be repaid by the liquidator outside the order of repayment of creditors' claims established by the Law.

(As amended by the Resolutions of the Board of the National Bank of the Kyrgyz Republic of April 10, 2019 No. 2019-P-12/19-1, December 28, 2022 No. 2022-P-12/83-6)

10. Three percent of the proceeds from the sale of assets and directed to satisfy creditors' claims (excluding amounts obtained from the sale of highly liquid assets not encumbered with liabilities, and collateral property) is directed by the liquidator to a reserve fund. Before the court approves the liquidator's final report, the National Bank has the right to recommend to the court to make a decision on the payment of remuneration to the liquidator upon completion of the liquidation procedure at the expense of the reserve fund, as well as, at the liquidator's decision - to employees according to concluded contracts. In the absence of such a recommendation from the National Bank, the payment of remuneration at the expense of the reserve fund is prohibited, and the reserve fund funds are directed to satisfy creditors' claims. The National Bank makes a decision on providing/not providing a recommendation to the court for the payment of remuneration to the liquidator upon completion of the liquidation procedure at the expense of the reserve fund, taking into account the degree of satisfaction of creditors' claims and the liquidator's compliance with the requirements of the legislation of the Kyrgyz Republic.

The decision to provide/not provide a recommendation must be reasoned and is made by the Board of the National Bank upon approval of the liquidator's final report.

11. The National Bank constantly monitors persons entitled to conduct the liquidation of banks to promptly present candidates for consideration by the Board of the National Bank for subsequent presentation to the court for appointment. Persons intending to carry out activities related to the liquidation of banks must mandatory provide information to the National Bank allowing verification of their compliance with qualification and other requirements, updating information no less than once a year.

12. The liquidator's interest in relation to the debtor, creditor, official, and/or shareholder of the bank is established by the National Bank, based on the information provided by the liquidator, taking into account the personal and business connections of the liquidator (Appendix 9).

A liquidator is considered an interested party if they are a close relative, spouse/spouse of debtors, creditors, officials, and/or shareholders of the bank, or have business relations with the aforementioned persons expressed in joint entrepreneurial activity, participation in the activities of legal entities, the existence of contractual relations, including loan/credit agreements and the existence of powers of attorney for representation of interests of the aforementioned persons, as well as business interests of close relatives of the liquidator with the debtor, creditor, official, and/or shareholder of the bank. At the same time, persons who were employees/connected with the bank persons/shareholders/affiliated persons of the liquidated bank during the five years preceding the liquidation of the bank cannot be liquidators, regardless of the actual time worked.

13. The bank liquidator is responsible for violating the legislation of the Kyrgyz Republic during the implementation of the bank's liquidation.

14. The bank liquidator is obliged to strictly follow the legislation of the Kyrgyz Republic in their activities and not allow situations leading to preferential treatment of one of the creditors.

15. Replacement of the liquidator is carried out in cases provided for by the Law of the Kyrgyz Republic "On Banks and Banking Activity".

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

16. After their appointment, the liquidator must immediately take measures to prevent uncontrolled access to assets by bank employees and shareholders and carry out the following actions:

1. exercise physical control over the bank building;
2. take keys from all employees;
3. seal the doors of all bank premises;
4. restrict bank employees' access to the bank vault;
5. notify correspondent banks, payment system operators, and payment organizations about the commencement of the bank's liquidation;
6. immediately, based on the corresponding order of the liquidator, within a period of five to ten days, carry out the acceptance and transfer of the bank's accounting and other documentation, seals and stamps, material and other valuables;
7. ensure that information about the bank's liquidation is reflected in documents related to the bank;
8. conduct an inventory of assets, accounts, and documents and take measures to ensure the safety of the bank's assets;
9. conduct an inventory of collateral property and ensure their proper storage. In the event that loss or damage to collateral property is revealed due to the fault of the former management of the bank, the liquidator takes measures in accordance with the legislation of the Kyrgyz Republic;
10. notify bank employees of the upcoming dismissal, in accordance with the Labor Code.

17. From the moment of their appointment, the bank liquidator is obliged to take control of the management of the bank's assets, as well as all title documents for these assets.

For these purposes, the bank liquidator is obliged:

1. take material assets into custody for their subsequent sale;
2. take into possession assets that are not under the bank's control, but for which the bank has ownership rights;
3. ensure the safety of assets;
4. inform third parties who currently lawfully possess assets and which will later come under the bank's control, about the commencement of the bank's liquidation and the rights of the liquidated bank to these assets;
5. collect intangible assets (rights) belonging to the bank, including future ones;
6. inform all known counterparties of the bank that such persons must pay only the bank's liquidator;
7. establish whether creditors' claims regarding the bank's property (claims on mortgages, lease agreements, contracts, etc.) are justified and lawful and whether enforcement of such claims is lawful;
8. carry out other measures aimed at conducting the liquidation of the bank in the best interests of its creditors.

18. One person may be appointed as a liquidator of a bank no more than:

1. a legal entity - four banks simultaneously;
2. a natural person (including an individual entrepreneur) - one bank.

Chapter 3. Liquidation Period

19. The period for conducting the liquidation of a bank may not exceed 24 (twenty-four) months. If necessary, this period may be extended by the court upon the petition of the liquidator with the written consent of the National Bank in the case of compulsory liquidation.

In the case of voluntary liquidation, the period may be extended upon the petition of the liquidator with the written consent of the National Bank.

In this case, the bank liquidator, 2 (two) months before the expiration of the liquidation period of the bank, sends a petition to the National Bank for extending the liquidation period of the bank, attaching reports of the liquidated bank for the past period as of the last reporting date, indicating the grounds and reasons justifying the need to extend the liquidation period. The National Bank considers the information specified in the petition regarding the need to extend the liquidation period within 30 (thirty) calendar days from the moment of receipt of the petition from the bank liquidator. The grounds for extending the liquidation period must be circumstances that significantly hinder the completion of the liquidation procedure within the established timeframes and affect the interests of the bank's creditors. As a result of considering the liquidator's petition to extend the liquidation period of the bank, the Board of the National Bank may make one of the following reasoned decisions:

1. agree with the liquidator's petition to extend the liquidation period of the bank;
2. agree with the liquidator's petition, but with an extension of the liquidation procedure for a different period;
3. not agree with the liquidator's petition to extend the liquidation period of the bank.

After receiving the written consent of the National Bank to extend the period of compulsory liquidation, the liquidator sends the corresponding application for approval to the court.

In the event of the National Bank's refusal to extend the liquidation periods, the bank liquidator must eliminate the remarks that served as the grounds for refusing to agree to the extension of the liquidation period, and submit a repeated petition, or apply to the court (in the case of compulsory liquidation), or to the National Bank (in the case of voluntary liquidation) in the manner established by this Regulation, with an application to complete the liquidation of the bank.

Extension of the liquidation period is not allowed without consideration and approval by the court of the liquidator's report for the previous period in the case of compulsory liquidation, and in the case of voluntary liquidation - by the National Bank.

(As amended by the Resolutions of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6, May 15, 2024 No. 2024-P-12/22-1)

19-1. During the period of conducting the liquidation of the bank, upon a reasoned application from the liquidator with the consent of the National Bank, the court may suspend the liquidation procedure for a period of no more than 6 (six) months.

In this case, the bank liquidator, no less than 3 (three) months before the expiration of the liquidation period of the bank, sends a petition to the National Bank to suspend the liquidation procedure of the bank, attaching reports of the liquidated bank for the past period as of the last reporting date, indicating the grounds and reasons justifying the need to suspend the liquidation procedure of the bank. Also, information on expenses necessary for continued functioning, as well as measures proposed by the liquidator to eliminate the grounds for suspending the liquidation procedure of the bank, must be attached to the petition.

The National Bank considers the information specified in the petition regarding the need to suspend the liquidation procedure of the bank within 30 (thirty) calendar days from the moment of receipt of the petition from the bank liquidator.

The grounds for suspending the liquidation procedure of the bank must be objective reasons, the existence of which does not allow continuing the implementation of necessary measures for the liquidation of the bank at the present time.

As a result of considering the liquidator's petition to suspend the liquidation procedure of the bank, the Board of the National Bank may make one of the following reasoned decisions:

1. agree with the liquidator's petition to suspend the liquidation procedure of the bank;
2. satisfy the liquidator's petition, but with a suspension of the liquidation procedure for a different period;
3. not agree with the liquidator's petition to suspend the liquidation procedure of the bank.

After receiving the written consent of the National Bank to suspend the procedure for compulsory liquidation, the liquidator sends the corresponding application for approval to the court.

In the event of the National Bank's refusal to suspend the liquidation procedure, the bank liquidator must eliminate the remarks that served as the grounds for refusing to agree to the suspension of the liquidation procedure, and submit a repeated petition to the National Bank or apply to the court with an application to complete the liquidation of the bank.

In the event of the court's decision to suspend the liquidation procedure, the period for conducting the liquidation of the bank is extended by the court proportionally to the period of suspension of the liquidation procedure.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

Chapter 4. Reporting of the Liquidator and the Liquidated Bank

20. Banks undergoing liquidation provide accounting, statistical reporting, and other reports of the liquidated bank to the National Bank in the manner and volume provided for by this Regulation, according to the liquidation form.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

21. The liquidator submits preliminary, current, and final reports to the court, the National Bank, and in the case of voluntary liquidation, to the general meeting of shareholders.

The National Bank has the right to request information from the liquidator regarding the liquidator's activities, including planned and actual administrative expenses for conducting the bank's liquidation procedure and the reasons for their deviations.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

22. The preliminary report is submitted by the liquidator no later than thirty calendar days from the date of commencement of the bank's liquidation procedure. The liquidator's preliminary report must contain:

• a report on the financial condition of the bank, including the bank's claims regarding the unpaid portion of the bank's share capital, agreements on the issuance of loans and provision of guarantees, sales agreements, as well as data on the book value and preliminary forecasted liquidation value of assets;
• a preliminary list of the bank's creditors' claims broken down by priority as provided for by the Law of the Kyrgyz Republic "On Banks and Banking Activity";
• a list of contracts according to which the bank's property is under the control of other parties, including lease, lease, and pledge agreements;
• a list of contracts for services provided to the bank;
• a list of all major transactions concluded by the bank within thirty days immediately preceding the date of decisions on the revocation of the license;
• obligations of the bank;
• transactions with affiliated and related parties of the bank.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

23. In the report on the state of the bank's assets at the beginning of the liquidation procedure, assets are classified based on security in the breakdown "fully secured", "partially secured", and "unsecured by collateral", as well as "by other types of security".

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

24. In the explanatory note to the report on the financial condition of the bank at the beginning of liquidation, the liquidator reflects the following information:

• justification of the realizable value for each item of assets;
• disclosure of information on secured, partially secured, and unsecured by collateral, as well as other types of security assets and liabilities;
• information on the cost of assets accounted for off-system;
• information on payments on deposits subject to protection in accordance with legislation on the protection of bank deposits.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 28, 2022 No. 2022-P-12/83-6)

25. The current report on the progress of the liquidation is submitted by the liquidator on a quarterly basis (as of the first day of the month following the reporting quarter) no later than the 5th day of the month following the reporting quarter. The current report on the progress of the liquidation must contain:

1. report by form (Appendix 1);
2. report on cash receipts and payments (Appendix 2);
3. explanatory note to the information on the financial position of the bank;
4. deposit base of banks undergoing liquidation by form (Appendix 3);
5. report on deposits broken down by amounts by form (Appendix 4);
6. report on the state of the credit portfolio separately by currencies by form (Appendix 5);
7. report on investments and financial participation by form (Appendix 6);
8. report on fixed assets by form (Appendix 7);
9. information on the degree of satisfaction of claims of all creditors of the liquidated bank, indicating the percentage ratio of satisfied and unsatisfied claims and breakdown by priority of satisfaction of creditors' claims in accordance with the legislation of the Kyrgyz Republic;
10. report on work done on the sale and plans for the sale of major assets or groups of other assets of the bank;
11. report on judicial and extrajudicial actions aimed at satisfying the bank's claims, including judicial actions to annul fraudulent agreements and transfers, as well as rights/obligations arising from such agreements and transfers;
12. report on illegal actions of bank officials and actions aimed at obtaining compensation for the benefit of the bank;
13. report on the continuation or termination of the validity of current contracts, such as insurance agreements, labor agreements, agreements on services and maintenance of the bank, including a detailed analysis of the financial support of bank employees;
14. report on changes in property capital (Appendix 8);
15. report on the implementation of the bank's liquidation plan.

Current reports of the liquidator on the progress of the liquidation are heard by the Supervisory Committee of the National Bank.

The Supervisory Committee of the National Bank may, if necessary, recommend raising separate issues for consideration by the Board of the National Bank.

(As amended by the Resolutions of the Board of the National Bank of the Kyrgyz Republic of October 8, 2025 No. 2025-P-12/50-4-(NPA), November 12, 2025 No. 2025-P-12/60-4-(NPA))

26. In the bank's reports during liquidation, the following information must be clearly highlighted and, if necessary, repeated:

• name of the bank;
• reporting date or period for which the report is submitted;
• reporting currency;
• units of measurement and degree of rounding used in compiling the reports.

27. Classification of sections in reporting forms must be preserved from period to period during the liquidation of the bank.

28. For each numerical indicator of reporting forms during liquidation, indicators at the beginning of the liquidation process must be provided.

29. The reliability of information is confirmed by the signature of the liquidator and the chief accountant of the bank.

30. In case of necessity, the bank liquidator may in