Resolution of the Board of the National Bank of the Kyrgyz Republic No. 9/4 of March 19, 2014 on Amendments to the Regulation on Credit Auctions

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

of March 19, 2014 No. 9/4

On Amendments and Additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation "On the Procedure for Conducting Credit Auctions by the National Bank of the Kyrgyz Republic for Refinancing and Liquidity Support" dated November 27, 2013 No. 45/13

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

RESOLVES:

1. Make amendments and additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation "On the Procedure for Conducting Credit Auctions by the National Bank of the Kyrgyz Republic for Refinancing and Liquidity Support" dated November 27, 2013 No. 45/13 (attached).

2. 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.

3. This resolution enters into force after 15 days from the date of its official publication.

4. The Monetary Operations Department shall bring this resolution to the attention of commercial banks and the relevant structural subdivisions of the National Bank of the Kyrgyz Republic.

5. Control over the implementation of this resolution is entrusted to the Deputy Chairman of the National Bank of the Kyrgyz Republic B.Zh. Zheenbaeva.

For the Chairman Deputy Chairman	Z.L. Chokoev

	Appendix to the Resolution of the Board of the National Bank of the Kyrgyz Republic dated March 19, 2014 No. 9/4

Amendments and Additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation "On the Procedure for Conducting Credit Auctions by the National Bank of the Kyrgyz Republic for Refinancing and Liquidity Support" dated November 27, 2013 No. 45/13

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 the Procedure for Conducting Credit Auctions by the National Bank of the Kyrgyz Republic for Refinancing and Liquidity Support" dated November 27, 2013 No. 45/13:

in the Regulation "On the Procedure for Conducting Credit Auctions by the National Bank of the Kyrgyz Republic for Refinancing and Liquidity Support" approved by the aforementioned Resolution:

1) in paragraph 16, after the words "for lending", add the words "in national currency";

2) rephrase paragraph 17 as follows:

"17. Banks must use credit resources obtained from the National Bank within the framework of credit auctions for lending to projects in accordance with the conditions and directions specified in paragraph 16 of the Regulation. In this case, credit resources must be provided to the Bank's borrower by executing the corresponding credit agreement, which must specify the specific terms of the loan issuance: amount, loan term, interest rate, terms for repayment of the principal and interest on the loan, etc. The terms of the credit agreement must comply with all requirements of the Regulation and the General Agreement.";

3) in the first paragraph of paragraph 20:

• in the first sentence, replace the words "established within the framework of special programs of the Government of the Kyrgyz Republic on subsidization" with the words "defined by the Central Bank in the auction parameters";
• exclude the second sentence;

4) in paragraph 26:

• rephrase the third paragraph as follows:

"The Bank's margin when providing credit resources to non-financial corporate users must not exceed the size established by the Central Bank, which is brought to the attention of Banks.";

• after the words "by directions" in the fifth paragraph, add the words "and conditions";

5) in paragraph 30, after the words "credit resources", add the words "the maximum nominal interest rate for the Bank's final borrowers,";

6) in the seventh paragraph of paragraph 31, after the words "applications", add the words "(in case of establishment by the Central Bank)";

7) in sub-item 2 of paragraph 41, exclude the words "and notes of the National Bank";

8) in the second sentence of the third paragraph of paragraph 52, after the words "on a proportional basis", add the words "with rounding to the thousandth place";

9) in Appendix 1 to the Regulation:

• in paragraph 2.6, after the words "exclusively", add the words "on terms and";
• in the first paragraph of paragraph 2.7:
• in the first sentence, replace the words "established within the framework of special programs of the Government of the Kyrgyz Republic on subsidization" with the words "defined by the Central Bank in the auction parameters";
• exclude the second sentence;
• rephrase paragraph 2.8 as follows:

"2.8. Banks must use credit resources obtained from the National Bank within the framework of credit auctions for lending to projects in accordance with the conditions and directions specified in paragraph 16 of the Regulation. In this case, credit resources must be provided to the Bank's borrower by crediting funds to the Bank's borrower's accounts, by executing the corresponding credit agreement, which must specify the specific terms of the loan issuance: amount, loan term, interest rate, terms for repayment of the principal and interest on the loan, etc. The terms of the credit agreement must comply with all requirements of the Regulation and this General Agreement.";

• rephrase paragraph 2.9 as follows:

"2.9. Banks are not entitled to direct credit resources obtained within the framework of credit auctions for financing loans classified and under observation status in accordance with the Regulation on asset classification and corresponding provisions for potential losses and losses approved by the Resolution of the Board of the National Bank, as well as loans issued previously from existing credit resources obtained within the framework of credit auctions of the National Bank.";

• rephrase paragraph 2.12 as follows:

"2.12. The Bank's margin when providing credit resources to non-financial corporate users must not exceed the size established by the Central Bank.";

• in the second sentence of paragraph 2.14, add the words "and in national currency";

10) consider three appendices 5 of Appendix 1 to the Regulation as respectively appendices 5, 6, and 7 of Appendix 1 to the Regulation;

11) in Appendix 5 (Agreement on Pledge of Government Securities) of Appendix 1 to the Regulation:

• in the first sentence of paragraph 3.2, replace the words "issuers of which are the Government of the KR or the NBKR" with the words "issuer of which is the Government of the Kyrgyz Republic";

12) in Appendix 6 (Agreement on Pledge of Funds) of Appendix 1 to the Regulation:

• recognize paragraph 1.4 as losing force;
• recognize paragraph 3.2 as losing force;
• in paragraph 5.2, replace the digits "1.4." with the digits "1.3.";

13) in Appendix 7 (Agreement on Pledge of Rights under Credit Agreements) of Appendix 1 to the Regulation:

• in paragraph 1.3, replace the words "Agreed by the Parties total" with the word "Pledged";
• rephrase paragraph 3.2.3 as follows:

"3.2.3. Inform the Pledgee in writing of actions that led to a decrease, alteration, termination, or loss of the Subject of Pledge no later than 5 working days from the date of carrying out the aforementioned actions.";

• rephrase paragraph 3.2.12 as follows:

"3.2.12. When making amendments and additions to Credit Agreements that are the Subject of Pledge under this Agreement, and to pledge agreements that secure the performance of Credit Agreements, inform the Pledgee in writing of the amendments and additions no later than 5 working days from the date of making amendments and additions to the respective agreements.";