Resolution of the Board of the National Bank of the Kyrgyz Republic of 13 September 2023 No. 2023-P-12/58-3-(NPA)

On temporary decisions

of the National Bank of the Kyrgyz Republic on regulating the activities

of OJSC "State Development Bank of the Kyrgyz Republic"

In order to implement the Decree of the President of the Kyrgyz Republic "On the Open Joint-Stock Company "State Development Bank of the Kyrgyz Republic" of 5 September 2023 No. 217 and in accordance with Articles 5, 9 and 64 of the Constitutional Law of the Kyrgyz Republic "On the National Bank of the Kyrgyz Republic", Article 14 of the Law of the Kyrgyz Republic "On Banks and Banking Activities", the Board of the National Bank of the Kyrgyz Republic resolves:

1. Until the adoption of a corresponding decision of the Board of the National Bank of the Kyrgyz Republic, suspend the effect of the following resolutions of the Board of the National Bank of the Kyrgyz Republic in relation to OJSC "State Development Bank of the Kyrgyz Republic":

• 1) "On introducing amendments and additions to certain regulatory legal acts of the National Bank of the Kyrgyz Republic" of 16 November 2012 No. 43/1;

• 2) "On approval of the Regulation "On corporate governance in commercial banks of the Kyrgyz Republic" of 17 May 2017 No. 19/12;

• 3) "On approval of the Regulation "On pre-trial settlement of disputes between the National Bank of the Kyrgyz Republic and commercial banks, organizations carrying out certain types of banking operations, and their founders (participants), legal entities and individuals" of 17 May 2017 No. 19/13;

• 4) "On approval of the Instruction "On requirements for bank operations with affiliated and related persons of the bank" of 31 May 2017 No. 21/5;

• 5) "On approval of the Regulation "On licensing of banking activities" of 8 June 2017 No. 2017-P-12/23-1-(NPA), with the exception of Section IV "Procedure for approval of officials";

• 6) "On approval of the Regulation "On consolidated supervision" of 8 June 2017 No. 2017-P-12/23-6-(NPA);

• 7) "On approval of the Regulation "On the Temporary Administration" of 8 June 2017 No. 2017-P-12/23-8-(NPA);

• 8) "On approval of the Regulation "On minimum requirements for external audit of banks and other financial and credit organizations licensed by the National Bank of the Kyrgyz Republic" of 15 June 2017 No. 2017-P-12/25-2-(NPA);

• 9) "On the Regulation "On measures of influence applied to banks licensed by the National Bank of the Kyrgyz Republic" of 15 June 2017 No. 2017-P-12/25-4-(NPA);

• 10) "On approval of the Regulation "On minimum requirements for risk management in banks of the Kyrgyz Republic" of 15 June 2017 No. 2017-P-12/25-8-(NPA);

• 11) "On approval of the Regulation "On the procedure for conducting certain banking operations by banks of the Kyrgyz Republic in the event of the introduction of a Temporary Administration regime or the commencement of liquidation proceedings" of 15 June 2017 No. 2017-P-12/25-9-(NPA);

• 12) "On approval of the Instruction on the exercise of banking supervision" of 20 June 2018 No. 2018-P-12/24-2-(NPA);

• 13) "On the Regulation "On required reserves" of 13 March 2019 No. 2019-P-07/10-1-(DKP);

• 14) "On approval of the Regulation "On consolidated supervision" and the Regulation "On periodic regulatory consolidated reporting" of 28 June 2019 No. 2019-P-12/34-4-(NPA);

• 15) "On approval of the Regulation "On minimum requirements for the organization of internal control in commercial banks for the purposes of countering the financing of terrorist activities and the legalization (laundering) of criminal proceeds", the Regulation "On the procedure for conducting exchange operations with cash foreign currency in the Kyrgyz Republic" and on introducing amendments and additions to certain regulatory legal acts of the National Bank of the Kyrgyz Republic on issues of countering the financing of terrorist activities and the legalization (laundering) of criminal proceeds" of 14 August 2019 No. 2019-P-12/42-1-(NPA);

• 16) "On approval of the Regulation "On requirements for ensuring information security in commercial banks of the Kyrgyz Republic" of 22 December 2021 No. 2021-P-20/72-8-(NPA);

• 17) "On approval of the Instruction on determining standards of capital sufficiency (adequacy) of commercial banks of the Kyrgyz Republic" of 12 October 2022 No. 2022-P-12/63-1-(NPA);

• 18) "On approval of the Regulation "On economic standards and requirements mandatory for commercial banks of the Kyrgyz Republic" of 14 December 2022 No. 2022-P-12/78-7-(NPA);

• 19) "On approval of the Instruction "On credit restrictions" of 12 April 2023 No. 2023-P-12/23-5-(NPA).

2. In order to ensure sustainable activity, as well as achieve the goal and objectives, and effectively implement the functions of OJSC "State Development Bank of the Kyrgyz Republic" (hereinafter – the Development Bank), provided for by the Law of the Kyrgyz Republic "On the State Development Bank of the Kyrgyz Republic", the Board of Directors of the Development Bank:

• 1) organize an adequate and effective risk management and internal control system of the Development Bank and ensure its proper functioning;

• 2) establish limit levels of risks associated with the operational and investment activities of the Development Bank, as well as internal standards and restrictions on the volumes of operations conducted by the Development Bank;

• 3) strengthen control over minimizing risks associated with the operational and investment activities of the Development Bank and compliance by the Development Bank with the established limit levels of these risks, as well as internal standards and restrictions on the volumes of operations conducted by the Development Bank;

• 4) establish in the Development Bank effective systems of assessment, monitoring and control in order to maintain an appropriate level of capital in accordance with the risks inherent in the activities of the Development Bank;

• 5) periodically assess the current activities of the Development Bank and financial results from the point of view of achieving strategic goals and forecast indicators of the business plans of the Development Bank.

3. The Development Bank shall, on a monthly basis, within 5 (five) working days after the end of the reporting period, provide information on the implementation of paragraph 2 of this resolution to the Banking Supervision Department of the National Bank of the Kyrgyz Republic.

4. This resolution shall enter into force upon the expiry of 7 (seven) working days from the day of its official publication and shall remain in force until the adoption of a corresponding decision by the Board of the National Bank of the Kyrgyz Republic.

5. To the Legal Department:

• from the day of receipt of the relevant documents, within 3 (three) working days, 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 Normative Legal Acts of the Kyrgyz Republic.

6. The Supervision Methodology Department shall, after official publication, within 3 (three) working days, bring this resolution to the attention of OJSC "State Development Bank of the Kyrgyz Republic", structural subdivisions, regional departments and the Representative Office of the National Bank of the Kyrgyz Republic in Batken Oblast.

7. Control over the implementation of this resolution shall be assigned to the member of the Board of the National Bank of the Kyrgyz Republic supervising the Supervision Methodology Department.

Chairman K. Bokontaev