Resolution of the National Bank of the Kyrgyz Republic No. 2022-P-12/19-4-(NPA) on Additional Temporary Measures Regarding Asset Classification by Financial and Credit Organizations

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

of March 31, 2022 No. 2022-P-12/19-4-(NPA)

On Additional Temporary Measures of the National Bank of the Kyrgyz Republic Regarding Asset Classification by Financial and Credit Organizations

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of September 28, 2022 No. 2022-P-12/60-2)

In order to maintain stability in the country's banking system and in accordance with Articles 20, 68, and 87 of the Law of the Kyrgyz Republic "On the National Bank of the Kyrgyz Republic, Banks, and Banking Activity," the Board of the National Bank of the Kyrgyz Republic resolves:

1. Make changes to the following resolutions of the Board of the National Bank of the Kyrgyz Republic (attached):

• (paragraph lost force in accordance with the Resolution of the Board of the National Bank of the Kyrgyz Republic of September 28, 2022 No. 2022-P-12/60-2)

• "On Approval of the Regulation 'On Asset Classification and Corresponding Provisions to the Reserve for Covering Potential Losses and Damages' dated July 21, 2004 No. 18/3.

2. Banks and non-bank financial-credit organizations registered in the Kyrgyz Republic shall not accrue or charge commissions and other payments for the review of credit contract terms due to changes in cash flows and the financial position of borrowers due to the influence of the current geopolitical situation and negative consequences of the external economic shock.

3. This Resolution enters into force from the day of its official publication and remains in force until the adoption of a corresponding decision by the Board of the National Bank.

4. 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.

5. The Department of Supervision Methodology and Banking Licensing shall bring this Resolution to the attention of the Non-Commercial Organization "Union of Banks of Kyrgyzstan," commercial banks, all structural subdivisions, regional departments, and the representation of the National Bank in the Batken region.

6. The Department of Supervision of Non-Bank Financial-Credit Organizations shall bring this Resolution to the attention of the Non-Commercial Organization "Association of Microfinance Organizations," microfinance companies attracting term deposits, JSC "Financial Company of Credit Unions," and JSC "Guarantee Fund."

7. Control over the implementation of this Resolution shall be entrusted to the Member of the Board of the National Bank of the Kyrgyz Republic overseeing the Department of Supervision Methodology and Banking Licensing.

Chairman	K. Bokonbaev

Changes

to certain regulatory legal acts of the National Bank of the Kyrgyz Republic

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of September 28, 2022 No. 2022-P-12/60-2)

1. (Lost force in accordance with the Resolution of the Board of the National Bank of the Kyrgyz Republic of September 28, 2022 No. 2022-P-12/60-2)

2. Make the following change to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation 'On Asset Classification and Corresponding Provisions to the Reserve for Covering Potential Losses and Damages' dated July 21, 2004 No. 18/3:

in the Regulation "On Asset Classification and Corresponding Provisions to the Reserve for Covering Potential Losses and Damages," approved by the aforementioned resolution:

• rephrase the seventeenth paragraph of sub-item 4.1.1 as follows:

"Banks may classify newly issued loans in US dollars as 'normal assets' if they meet the requirements specified in item 4.2 of this Regulation, with the formation of a Provision for Potential Losses and Damages (PPLD) in the amount of 0 to 2 percent, regardless of the income structure, in accordance with the internal policy of the bank. At the same time, these requirements apply to preferential loans issued under the cooperation of the Cabinet of Ministers of the Kyrgyz Republic with the Government of the Russian Federation (Russian-Kyrgyz Development Fund – hereinafter the Development Fund), including loans for funds attracted and guaranteed by the Development Fund from other foreign financial institutions, including previously issued loans, the repayment of which will be carried out through financing from the Development Fund's resources and involves a change in the initial terms of the credit contract.".