Resolution of the Board of the National Bank of the Kyrgyz Republic No. 58/16 of December 24, 2014 on Amendments and Additions to Certain Resolutions of the Board of the National Bank of the Kyrgyz Republic

LOST ITS FORCE in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic dated June 15, 2017 No. 2017-P-12/25-10-(NFPU)

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

dated December 24, 2014 No. 58/16

On Amendments and Additions to Certain Resolutions of the Board of the National Bank of the Kyrgyz Republic

(In the edition of the resolutions of the Board of the National Bank of the Kyrgyz Republic dated December 9, 2015 No. 76/9, December 23, 2015 No. 78/25)

In accordance with Articles 7 and 43 of the Law "On the National Bank of the Kyrgyz Republic", the Board of the National Bank of the Kyrgyz Republic

RESOLVES:

1. Make the attached amendments and additions to the following resolutions of the Board of the National Bank of the Kyrgyz Republic:

• "On Regulation "On Licensing, Reorganization and Liquidation of the Specialized Financial-Credit Institution JSC "Financial Company of Credit Unions" dated July 25, 2012 No. 30/14;

- (lost its force in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic dated December 23, 2015 No. 78/25)

- (lost its force in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic dated December 9, 2015 No. 76/9)

• "On Regulation "On Licensing, Reorganization and Liquidation of Microfinance Companies in the Territory of the Kyrgyz Republic" dated January 31, 2007 No. 5/1;

• "On Minimum Qualification Requirements Imposed on Officials of the Specialized Financial-Credit Institution - Successor of the Limited Liability Company "FKRPKS" and the Procedure for Their Coordination with the National Bank of the Kyrgyz Republic" dated April 17, 2012 No. 17/1.

2. This Resolution shall enter into force upon the expiration of fifteen days from the date of official publication.

3. The Legal Department:

• publish this Resolution on the official website of the National Bank of the Kyrgyz Republic;

• after official publication, send this Resolution to the Ministry of Justice of the Kyrgyz Republic for inclusion in the State Register of Regulatory Legal Acts of the Kyrgyz Republic.

4. The Department of Supervision and Licensing Methodology shall bring this Resolution to the attention of JSC "Financial Company of Credit Unions", microfinance organizations, and credit unions.

5. Control over the execution of this Resolution shall be entrusted to the Deputy Chairman of the National Bank of the Kyrgyz Republic L.Dj. Orozbayeva.

Chairman	T. Abdygulov

	Appendix 1 to the resolution of the Board of the National Bank of the Kyrgyz Republic No. 58/16 dated "24" December 2014

(In the edition of the resolution of the Board of the National Bank of the Kyrgyz Republic dated December 9, 2015 No. 76/9)

1. (Lost its force in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic dated December 9, 2015 No. 76/9)

2. Make the following amendments and additions to the resolution of the Board of the National Bank of the Kyrgyz Republic "On Regulation "On Licensing, Reorganization and Liquidation of Microfinance Companies in the Territory of the Kyrgyz Republic" dated January 31, 2007 No. 5/1;

in the Regulation "On Licensing, Reorganization and Liquidation of Microfinance Companies in the Territory of the Kyrgyz Republic" approved by the aforementioned resolution:

1) sub-item 11 of item 4.2. be worded as follows:

"11) information allowing determination of the sources of origin of funds contributed by founders/participants (shareholders) to the authorized capital of an MFC in an amount exceeding 1% of the minimum size of the authorized capital established by the National Bank for a newly created MFC not carrying out operations for accepting term deposits from individuals and legal entities:

a) legal entities submit:

• copies of the balance sheet and income statement for the last financial year, confirmed by authorized bodies of the Kyrgyz Republic or;

• copies of financial statements for the last financial year, declarations or other documents on financial condition;

• a copy of the audit report (if this requirement is established by legislation);

• other documents confirming the sources of origin of funds contributed to the authorized capital, not prohibited by legislative acts of the Kyrgyz Republic;

b) individuals submit:

• certificates, income declarations, sales/gift contracts, right to inheritance of sums, property, etc.

• other documents confirming the sources of origin of funds contributed to the authorized capital, not prohibited by legislative acts of the Kyrgyz Republic.

Copies of submitted documents must be notarized.

Upon request of the National Bank, the MFC must provide information (documents) confirming the sources of origin of funds contributed to the authorized capital regardless of the conditions established in the first paragraph of this sub-item.".

2) Paragraph 7 of item 9.7.2 be worded as follows:

"- a document confirming the deposit of funds in full amount to increase the authorized capital to an account in a commercial bank on the date of application submission (statements from the bank's current account);

If the capital increase is carried out:

• from additional capital contributed by founders/participants (shareholders) - a contract/agreement on the contribution of funds as additional capital and statements from the bank's current account on the contribution of said funds are submitted;

• from undistributed profit - a decision of the general meeting of founders/participants (shareholders) on profit distribution is submitted.".

3) Item 9.7.2 be supplemented with paragraph 8 of the following content:

"- information allowing determination of the sources of origin of funds, according to the list of documents established in sub-item 11 of item 4.2.";

4) Item 9.9.1 be worded as follows:

"9.9.1. Change of location (postal address) of an MFC may be accompanied by changes in the name of the settlement, name of the street, house number, relocation of the MFC to another settlement. Change of location of an MFC within one settlement does not entail replacement of its license and does not require making corresponding changes to the constituent documents. Upon change of location, including change of actual address, the MFC submits to the DMSL the following documents:

1) notification of change of location, including change of actual address, of the MFC.";

2) a copy of the lease agreement or a document confirming the MFC's right of ownership to the corresponding premises.".

3. Make the following amendments and additions to the resolution of the Board of the National Bank of the Kyrgyz Republic "On Minimum Qualification Requirements Imposed on Officials of the Specialized Financial-Credit Institution - Successor of the Limited Liability Company "FKRPKS" and the Procedure for Their Coordination with the National Bank of the Kyrgyz Republic" dated April 17, 2012 No. 17/1;

in the "Minimum Qualification Requirements Imposed on Officials of the Specialized Financial-Credit Institution - Successor of the Limited Liability Company "FKRPKS" and the Procedure for Their Coordination with the National Bank of the Kyrgyz Republic", approved by the aforementioned resolution:

1) The Title be worded as follows:

"Procedure for Coordination of Officials of the Specialized Financial-Credit Institution JSC "Financial Company of Credit Unions".;

2) Throughout the text of the document, the abbreviation "LLC FKPRKS" be replaced with "JSC "FK KS";

3) Throughout the text of the document, the abbreviation "NBKR" be replaced with "National Bank" in the appropriate cases;

4) item 2 be worded as follows:

"2. A candidate for the position of a member of the Board, Chief Accountant, Head of a Structural Subdivision of an SFCU who determines policy, has the authority to participate or actually participates in the main operations of the SFCU forming the policy of the SFCU (on credits, on finances, etc.) must meet the following requirements:

1) have higher education;

2) have the following work experience:

• for a candidate for the position of Chairman of the Board - not less than three years in the financial-credit system, including in managerial positions - not less than one year;

A candidate for the position of Chairman of the Board must also possess:

a) skills in analyzing the activities of JSC "FKKS" and the credit union system as a whole;

b) knowledge on issues of credit union activities, confirmed by a certificate/certificate of completion of training. and the presence of at least two recommendations from persons working or having worked in the financial-banking sphere (except for recommendations from NBKR employees, from close relatives of the candidate, from managers and employees of JSC "FK KS" itself);

c) must not be a participant or official of a credit union during the last 3 years at the time of his appointment as Chairman of the Board of JSC "FKKS".

• for a candidate for the position of a member of the Board - not less than two years in the financial-credit system;

• for a candidate for the position of Chief Accountant, Head of a Structural Subdivision - at least one year in the financial-credit system;

3) have knowledge in the field of legislation regulating the activities of financial-credit institutions, risk management and corporate governance;

4) know the business plan of the SFCU;

5) absence of a court decision prohibiting the candidate from working in the financial-credit system;

6) regarding the candidate, there is no guilty verdict of a court for committing crimes in the economic sphere and for official crimes;

7) regarding the candidate, there are no acts of authorized bodies recognizing his involvement in actions (inaction), as a result of which the bank/financial-credit institution had its license revoked.".

5) Paragraph 5 of item 4 be worded as follows

"The Deputy Chairman of the National Bank, overseeing the DMSL, makes a decision on compliance/non-compliance with the requirements of the National Bank of candidates for positions of members of the Board of Directors, members of the Board, members of the Audit Commission and heads of structural subdivisions.";

4. Make the following amendments and additions to the resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation "On Licensing, Reorganization and Liquidation of the Specialized Financial-Credit Institution JSC "Financial Company of Credit Unions", dated July 25, 2012 No. 30/14, the following amendments and additions:

in the Regulation "On Licensing, Reorganization and Liquidation of the Specialized Financial-Credit Institution JSC "Financial Company of Credit Unions", approved by the aforementioned resolution:

1) Throughout the text of the Regulation, the words "Minimum Qualification Requirements Imposed on Officials of the Specialized Financial-Credit Institution - Successor of the Limited Liability Company "FKRPKS" and the Procedure for Their Coordination with the National Bank of the Kyrgyz Republic" be replaced with the words "Procedure for Coordination of Officials of the Specialized Financial-Credit Institution JSC "Financial Company of Credit Unions" in the appropriate cases;

2) Item 1 of Appendix 5 be worded as follows:

"1. This license permits the following separate banking operations:

1) granting loans to credit unions;

2) granting loans to participants of credit unions, upon request and with mandatory participation of the credit union (as a third party);

3) attracting funds from financial-credit institutions;

4) purchase and sale of debt obligations (factoring) of credit unions;

5) acceptance of deposits (deposits) from credit unions;

6) opening and maintaining accounts for credit unions;

7) carrying out settlements on behalf of credit unions and their cash servicing;

8) carrying out money transfer operations as a system operator for credit unions;

9) carrying out other operations taking into account the restrictions established by the National Bank.".

5. (Lost its force in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic dated December 23, 2015 No. 78/25)