Appendix  to Resolution No. 2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

REGULATION 

on Provisional Administration 

Chapter 1. General Provisions 

1. This Regulation shall determine the grounds, order, procedures for the introduction and implementation of the Provisional Administration and implementation of the restructuring of commercial banks, microfinance organizations that attract deposits, the State Development Bank, the “Financial Company of Credit Unions” OJSC, credit unions that attract deposits, including those carrying out operations in accordance with the Principles of Islamic Banking and Finance or having an “Islamic window”, taking into account a special terminology used by them while conducting banking operations (hereinafter referred to as the banks) during the Provisional Administration. At the same time, restructuring procedures shall not be applied to credit unions. 

This provision shall apply to the credit unions, taking into account the specifics of their activities in accordance with the legislation of the Kyrgyz Republic. 

2. This Regulation uses the definitions set forth in the Law of the Kyrgyz Republic “On the National Bank of the Kyrgyz Republic, Banks and Banking Activities” (hereinafter referred to as the Law), as well as the following concepts: 

Provisional administration is a special bank’s management and activity regime introduced by the National Bank of the Kyrgyz Republic (hereinafter referred to as the National Bank) as an enforcement action to establish control over the bank to ensure the security of assets, documents and information, protect the rights and legitimate interests of depositors and other bank creditors, to ensure stability and security of the banking system of the Kyrgyz Republic, as well as to establish the actual state of affairs in the bank, and to determine its future activities; 

Provisional Administrator is a person appointed by the National Bank to the position of a Provisional Administrator or a head of a Provisional Administration in order to implement the regime of the Provisional Administration in the bank; 

Counteraction to the Provisional Administration - act or failure to act of the management bodies and/or certain officials and employees of the bank (branch/subsidiary) and other bank-related parties that impede or make it impossible for the Provisional Administrator or the head/members of the Provisional Administration to perform the functions specified in the Law and the present Regulation; 

Act on Countering the Implementation of the Provisional Administration is a document that is drawn up for each fact of counteraction of the management bodies and/or certain officials and/or employees of the bank (branch/subsidiary) and other bank-related parties to the implementation of the Provisional Administration; 

Supervisory authority is the structural units of the National Bank, the Supervisory Committee of the National Bank provided for by the organizational structure of the National Bank; 

Bank restructuring is a set of measures taken with respect to the bank in order to protect the interests of depositors and other creditors, maintaining the continuity of the functions of the bank systemically important for the banking or payment system, as well as ensuring the stability of the banking and financial system. 

Chapter 2. Introduction of the Provisional Administration 

3. The Provisional Administration shall be introduced to the bank if there are grounds specified in the Law. 

4. The decision on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration shall be made by the Board/Supervisory Committee (hereinafter referred to as the Board) of the National Bank upon the petition of the supervisory authority. The decision of the National Bank Board on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration shall be formalized by a decision of the National Bank Board, and shall enter into force from the moment it is adopted unless otherwise provided for in the resolution itself. 

5. The decision on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration may be taken by the National Bank Board upon the application of the Management, the Board of Directors, creditors and shareholders of the bank, as well as on the application of law enforcement, judicial and other authorized state bodies, which shall specify the grounds for the appointment of the Provisional Administration. 

6. If the persons specified in Clause 5 of these Regulations initiate the introduction of the Provisional Administration, they shall submit the following documents to the National Bank together with the application/appeal: 

- an application for the bank’s non-payment of accounts payable within the next five working days after the due date, or about other grounds for the introduction of the Provisional Administration in accordance with the legislation of the Kyrgyz Republic; 

- justification of the need to introduce the Provisional Administration in the bank with reference to the relevant regulatory legal acts and the appendix of supporting documents. 

The supervisory authority shall review these documents within 20 working days and, in case of justification and necessity to introduce the Provisional Administration based on the submitted documents, shall submit an application for consideration to the National Bank Board for decision-making. 

7. The application for the introduction of the Provisional Administration in a bank shall contain: 

- information on the bank, branches, savings banks, subsidiaries and affiliates, the structure of the banking group (if applicable); 

- justification of the appointment of the Provisional Administration; 

- information on the financial condition of the bank (including the results of the latest comprehensive and targeted inspections); 

- proposal on the term of the Provisional Administration, but not more than six months; 

- proposal on the composition of the Provisional Administration (candidatures of the Provisional Administrator, members of the Provisional Administration) indicating information on the compliance of candidates with the requirements set by the National Bank; 

- proposals (if any/where applicable) for the introduction of restrictions in the activities of the bank with an indication of the rationale; 

- list of correspondents of the bank; 

- other information. 

8. The resolutions of the National Bank Board on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration shall indicate: 

- firm (full official) and abbreviated name of the bank in respect of which a decision is made to introduce the Provisional Administration; 

- grounds for the introduction of the Provisional Administration (including references to regulatory legal acts); 

- date and time to establish the regime of the Provisional Administration; 

- the term of the Provisional Administration regime; 

- the mode of operation of the bank, including the procedure for making settlements and payments by the bank (if necessary); 

- list of restrictions of activities imposed on the bank (if necessary); 

- information on the Provisional Administrator and the persons involved, as well as the employees of the National Bank included in the Provisional Administration, indicating the surname, name, patronymic and positions they will occupy, and the right to sign on the documents; 

- commission or instructions that are binding upon the Provisional Administration (if necessary); 

- the timing of the receipt of documents, assets and valuables of the Bank by the Provisional Administration; 

- a requirement to notify correspondent banks of the appointment of the Provisional Administration; 

- the terms and procedure for providing estimates of expenses and reporting by the Provisional Administration to the National Bank. 

The decision of the National Bank Board on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration may contain other provisions that are necessary to fulfill the tasks and functions entrusted to the Provisional Administration. 

9. The Provisional Administrator shall determine the allocation of responsibilities between the persons involved in the Provisional Administration. 

10. The Resolution of the National Bank Board on the introduction of the Provisional Administration and the appointment of the Provisional Administrator/Head of the Provisional Administration shall be communicated to the management bodies of the Bank by the supervisory authority within one working day from the moment of adoption of the decision on the introduction of the Provisional Administration, unless otherwise specified in the resolution itself. 

A copy of the resolution of the National Bank Board shall be given to any member of the Board of Directors or to the head of the bank against receipt, indicating the date and time of delivery on the second original of the copy kept by the Provisional Administrator until termination of his/her authorities. The Provisional Administrator shall provide a copy of the second original of the Resolution with the signature on the receipt by the bank to the supervisory authority. 

11. While making a decision on the introduction of the Provisional Administration, the supervisory authority shall send a notification letter to the organizations providing services on interbank payment and settlement systems to all commercial banks, the Agency for the Protection of Deposits of the Kyrgyz Republic (hereinafter referred to as the Agency for the Protection of Deposits) within one working day from the date, on which the decision is made on the introduction of the Provisional Administration, unless otherwise specified in the resolution itself.  

The notification letter should contain the following: 

- the name of the bank, in which the Provisional Administration was introduced; 

- a message on the beginning of the Provisional Administration indicating the number and date of adoption of the relevant resolution of the National Bank Board; 

- the date and time of the beginning of the Provisional Administration; 

- the timing of the introduction of the Provisional Administration; 

- full name of the Provisional Administrator; 

- a sample of the signature of the Provisional Administrator. 

12. The Provisional Administration shall be introduced for a period of up to 6 months. The Provisional Administration may be extended only once by the National Bank Board for a period of not more than 6 months. 

13. The announcement of the beginning of the Provisional Administration shall be published in the mass media and on the website of the National Bank. 

Chapter 3. Composition of the Provisional Administration 

14. The composition of the Provisional Administration shall be determined depending on the nature and scope of the work to be undertaken. 

The Provisional Administration may include, in addition to the Provisional Administrator, persons involved by the Provisional Administrator and/or employees of the National Bank. 

15. The Provisional Administrator may be a person who meets the qualification requirements established by this Regulation. Employees of the National Bank cannot be a Provisional Administrator. 

16. The Provisional Administrator shall act based on a contract concluded with the National Bank, which specifies the duties, responsibilities, working conditions and remuneration of the Provisional Administrator. 

17. Members of the Provisional Administration who are employees of the National Bank shall be appointed by the National Bank Board to participate in the work of the Provisional Administration and exercise functions and powers in accordance with the distribution of duties established by the Provisional Administrator. 

18. Officials and affiliates of the bank cannot be appointed in the composition of the Provisional Administration, in which the Provisional Administration is appointed, as well as the persons who have a conflict of interest. These requirements shall apply, among other things, to the employees of the National Bank. At the same time, the performance of certain powers may be assigned to the officials of the bank at the discretion of the Provisional Administrator. Such assignment should be formalized by the appropriate order/instruction of the Provisional Administrator. 

19. The composition of the Provisional Administration may include its employees on the issues of determining the compliance of information on deposits with certain requirements, the volume and structure of the bank’s liabilities to depositors, payment of contributions to the Deposit Protection Fund, established by the legislation of the Kyrgyz Republic in agreement with the Deposit Protection Agency. 

20. Civil liability of the Provisional Administrator shall be subject to compulsory insurance. 

21. The National Bank Board may appoint another Provisional Administrator in case of: 

- the absence of the Provisional Administrator for sickness or other reasons jeopardizing the Provisional Administration; 

- violation of the terms of the contract concluded with the National Bank by the Provisional Administrator; 

- untimely and/or incorrect presentation of the report by the Provisional Administrator; 

- inability to act, perform the functions and duties assigned to the Provisional Administrator by the Law and this Regulation; 

- violation of the requirements of the legislation of the Kyrgyz Republic; 

- the deliberate act or inaction of the Provisional Administrator, which prevents to achieve the goals of the Provisional Administration, as established by the Law and this Regulation. 

Chapter 4. Qualification Requirements for the Provisional Administrator 

22. The candidate for the position of a Provisional Administrator shall meet the following minimum requirements: 

1) have a diploma of higher education; 

2) work experience of at least five years in the financial and banking system, including at senior positions - at least two years; 

3) to have knowledge in the field of legislation of the Kyrgyz Republic regulating banking activities in the field of bank risk management, as well as regulatory legal acts of the National Bank; 

4) to have an impeccable business reputation; 

5) absence of a conflict of interest with the bank-related parties, creditors and borrowers of the bank, which the Provisional Administration is introduced to. 

23. The combination of the work of the Provisional Administrator with the positions in banks or other legal entities supervised by the National Bank, as well as in other organizations, including part-time (excluding teaching, research and creative activities) shall not be allowed. 

24. In order to prevent a conflict of interests, candidates for the positions of the Provisional Administrator and members of the Provisional Administration shall provide information on their personal data and business interests in accordance with Annex 6 to this Regulation. 

25. Candidates for the positions of the Provisional Administrator and members of the Provisional Administration shall submit completed questionnaires in accordance with Appendix 7 to this Regulation. The questionnaires are included in the list of materials for the National Bank Board when deciding on the appointment of the Provisional Administration. 

26. The information on personal data and business interests shall be provided when the Provisional Administration is appointed/extended and when changes in the information provided are made. This information should be included in the list of materials for the National Bank Board when deciding on the appointment of the Provisional Administration. 

Chapter 5. Implementation of the Provisional Administration 

27. Since the introduction of the Provisional Administration: 

1) the powers of the management bodies of the bank and officials shall be suspended and transferred to the Provisional Administration. After that, all decisions of the management bodies shall be considered unauthorized, if the Provisional Administration does not approve them. The Provisional Administration shall exercise all the powers of the management bodies of the bank in accordance with the charter of the bank and the legislation of the Kyrgyz Republic, with the exception of the authority to take a decision on voluntary liquidation; 

2) only Provisional Administration can act as a legal entity on behalf of the bank. Any actions taken by someone on behalf of the bank shall be considered predeterminedly insignificant; 

3) the execution of judicial acts on recovery of debts from the bank shall be suspended, with the exception of the bank’s trust property; 

4) accrual of interest, penalties and other financial sanctions on all debt obligations of the bank, including payment of mandatory payments to the budget shall be suspended; 

5) distribution of profits, payment of dividends, fulfillment of any financial obligations to shareholders, as well as payment of any remuneration (premium, bonuses and other incentive payments, except for fixed wages) to officials and employees of the bank shall be suspended; 

6) all banking operations, transactions and other activities shall be suspended, unless otherwise specified by the National Bank; 

7) the proceedings on civil and economic cases, on which the bank is a party, shall be suspended; 

8) the execution of any compulsory acts of the authorized state bodies taken with respect to the bank shall be suspended. 

28. The Provisional Administrator, the specialists and/or the employees of the National Bank involved by him/her and appointed by the National Bank to the composition of the Provisional Administration, shall not be liable to any person for any losses in the course of lawful performance of their official duties or legal assignment. Complaints and claims in connection with their unlawful activities can only be brought against the National Bank. The National Bank has the right to bring claims in recourse. 

29. The procedure for conducting banking operations and payments, as well as other activities shall be determined by a Resolution of the National Bank Board based on proposals from the supervisory authority and/or the Provisional Administrator. 

30. With the consent of the National Bank, the rules of finality of settlements in payment systems and security settlement systems may be applied. The rules of finality of settlements in payment systems and security settlement systems shall be regulated by the Law and Regulation “On the Procedure for Conducting Certain Banking Operations by the Banks of the Kyrgyz Republic in the Event of the Introduction of the Regime of Provisional Administration or the Liquidation Procedure” approved by the Resolution of the National Bank Board. 

Chapter 6. Organization and Work Order of the Provisional Administration 

31. Since the introduction of the Provisional Administration, bank officials shall be required to provide the Provisional Administration with full and unhindered access to the premises, the assets and documentation of the bank. 

32. The management of the bank (members of the Management Board), upon the introduction of the Provisional Administration, shall be obliged to provide the Provisional Administration with a separate premises in the bank, in which there are no audio/video devices taking audio/video recording, to prevent any attempts to install audio/video equipment by third parties in the premises provided to the Provisional Administration, to ensure security of the storage of bank documents, the Provisional Administration, and provide the Provisional Administration with the equipment and machinery necessary to carry out the activities.  

33. During its activity, the Provisional Administration shall use office premises, communication facilities, motor vehicles and other technical equipment belonging to the bank in the manner and under the conditions established for the bank’s executive body, if the security interests of the Provisional Administration and/or protection of official information, or other circumstances do not require the establishment of special working conditions and the technical equipment of the Provisional Administration. 

34. The Provisional Administrator may delegate those powers that he/she deems necessary to the bank’s managers and employees, unless otherwise specified by the National Bank Board in order to implement the Provisional Administration. In addition, the Provisional Administrator has the right to recruit specialists for the implementation of the Provisional Administration. The information to that effect should be reflected in the report of the Provisional Administrator provided to the National Bank. 

35. The Provisional Administrator shall immediately after his/her appointment: 

- notify the branches, subsidiaries and representative offices of the bank, a banking group, a foreign bank (a branch of which is the bank, to which the Provisional Administration is introduced) on the introduction of the Provisional Administration and shall send a notification letter containing a sample of the signature of the Provisional Administrator; 

- issue orders for the establishment of a commission for taking inventory, the introduction of a special access mode for the persons who have the right to access the premises of the bank (branches/subsidiaries) and other necessary orders and instructions at the discretion of the Provisional Administrator in order to implement the Provisional Administration. 

36. The Provisional Administrator shall inform the correspondent banks about the introduction of the Provisional Administration regime (through the SWIFT system, by fax, other accessible and acceptable means of communication) immediately after his/her appointment and shall send a notification letter that contains the following: 

- a message on the beginning of the Provisional Administration indicating the number and date of adoption of the relevant resolution of the National Bank Board; 

- the time and date of the beginning of the Provisional Administration; 

- the period for which the Provisional Administration has been introduced; 

- information about the Provisional Administrator (his/her surname, name, patronymic), contact information; 

- other information that the Provisional Administrator deems necessary to communicate in the interests of the implementation of the Provisional Administration. 

37. The Provisional Administrator shall carry out other activities during the Provisional Administration in accordance with the legislation of the Kyrgyz Republic. 

Chapter 7. Rights and Responsibilities of the Provisional Administration 

38. The main responsibility of the Provisional Administration is to conduct the Provisional Administration regime of the bank under the Law. 

39. The responsibilities of the Provisional Administration are as follows: 

- taking measures to prevent deterioration of the bank’s financial condition; 

- ensuring the safety of records, documents and assets of the bank; 

- reconciliation of financial statements with the actual situation in the bank; 

- minimizing, if possible, the costs of the bank; 

- coordination with the National Bank of actions on the relationship with law enforcement agencies, if necessary; 

- taking the necessary measures to restore the solvency of the bank if there are real opportunities and intentions of the bank’s participants to improve the financial condition of the bank; 

- preparation of recommendations on further activities of the bank; 

- carrying out measures to restructure the bank in the case of an appropriate decision of the National Bank; 

- adoption of other measures for the purposes of the Provisional Administration. 

40. The Provisional Administrator shall report on the performance of his/her duties and the exercise of his/her powers to the National Bank Board. The Provisional Administrator shall coordinate his/her actions with the National Bank. 

41. The Provisional Administrator shall submit a monthly report - up to the 10th (tenth) day of the month following the reporting one to the National Bank (addressed to the Chairman of the National Bank) on the work done in accordance with Appendix 2 to this Regulation, with an explanatory note. 

42. The supervisory authority has the right to demand from the Provisional Administration the submission of additional information on the issues falling within the competence of the Provisional Administration. 

The National Bank Board is entitled, if necessary, to establish other deadlines for the submission of reports on the work for the Provisional Administration. 

43. During the Provisional Administration, the bank’s reports, including branches and subsidiaries (daily, monthly, quarterly, annual and other reports and information) shall be signed by the Provisional Administrator (representative of the Provisional Administration in the branch/subsidiary) and the chief accountant in accordance with the requirements of the National Bank. 

In the period of the Provisional Administration, the bank shall submit reports to state bodies (tax authorities, statistical agencies and others). 

44. The Provisional Administrator shall have the right to: 

- appoint or involve specialists for appointment by the representatives of the Provisional Administration to the branches of the bank, as well as to the management bodies of its subsidiaries; 

- convene a meeting of shareholders in accordance with the procedure established by the legislation of the Kyrgyz Republic; 

- seal, if necessary, the premises of the bank; 

- close branches, subsidiaries, representative offices, savings banks and other structural units of the bank; 

- sign any documents and contracts on behalf of the bank; 

- file complaints and claims on behalf of the bank; 

- conclude an agreement for an independent audit of the bank; 

- sign orders and instructions binding upon the representatives of the Provisional Administration and employees of the bank; 

- issue (with mandatory observance of labor legislation) orders/instructions for hiring, appointing to positions, dismissal, demotion or temporary suspension, assignment of responsibilities among bank employees; 

- revise the staff schedule of the bank (head office, branches, divisions, etc.) in accordance with the labor legislation; 

- raise the issue of bringing to responsibility (including through appealing to the appropriate law enforcement and judicial bodies) managers and participants of the bank and other bank-related parties for actions that led to the introduction of the Provisional Administration and/or caused problems in the bank, followed by notification of the supervisory authority; 

- be a representative in all courts on behalf of the bank in which the Provisional Administration is implemented, as a plaintiff or defendant in the period of the Provisional Administration of the bank; 

- perform other functions in accordance with the legislation of the Kyrgyz Republic. 

45. With the permission of the National Bank Board, the Provisional Administrator can pay out the deposit amounts of the parties not related to the bank partially or in full based on the information provided by the Provisional Administrator with an appropriate justification for payments and information on the impact of payments on the bank’s financial condition and liquidity figures. 

46. ​​The Provisional Administration shall be obliged to stop any payments to depositors if it concludes that bank restructuring is impossible and it is subject to liquidation. 

47. Within a period of not later than 15 calendar days from the date of introduction of the Provisional Administration to the bank, the Provisional Administrator shall be obliged to prepare and submit a report on the current financial status and evaluation of the bank’s activities to the National Bank Board. The report can be compiled with the help of an external auditor whose cost of services is included in the costs of the Provisional Administration. The report of the Provisional Administrator shall include an assessment of the value of assets that can be realized in the liquidation of a bank, a full definition of the volume of liabilities and remaining capital resources, as well as one of the following recommendations with the appropriate justification: 

- on the resumption of the independent activity of the bank in connection with the problem resolution; 

- on revocation of the license and commencement of compulsory liquidation of the bank; 

- on support of a proposal to restructure the bank. 

48. The National Bank Board having considered the report and recommendations of the Provisional Administrator shall take one of the following decisions: 

- on the resumption of the independent activities of the bank in connection with the problem resolution; 

- on revocation of the license and commencement of compulsory liquidation in accordance with the legislation; 

- on support of a proposal to start restructuring. 

Based on the decision taken by the National Bank Board, the Provisional Administrator shall prepare a plan for the future activities of the bank, which is submitted for consideration to the National Bank Board during the period set by the National Bank. 

Chapter 8. Bank Restructuring 

49. Bank restructuring shall be carried out by applying the following measures independently or among: 

1) bank recapitalization; 

2) transfer or sale of assets and liabilities of the bank; 

3) creation of a “transition bank”. 

While carrying out any measures on the bank restructuring, they shall not deteriorate the condition of the bank’s creditors as compared to those they would have upon the compulsory liquidation of the bank. The National Bank at any time has the right to make a decision on the beginning of the compulsory liquidation procedure of the bank under restructuring in accordance with the banking legislation of the Kyrgyz Republic. 

50. Application of measures on the bank restructuring shall be preceded by the evaluation of assets and liabilities of the bank. The assets and liabilities of the bank shall be evaluated in the order provided for by the legislation of the Kyrgyz Republic for the bank’s account. 

51. The measures on the bank restructuring shall be carried out by the Provisional Administrator within the regime of the Provisional Administrator with the consent of the National Bank. 

52. The National Bank shall have the plan of actions in the event of the accomplishment of measures on bank restructuring, including the one agreed with the Government of the Kyrgyz Republic and other concerned authorities. 

Chapter 9. Initiation of Measures on Bank Restructuring 

53. If a recommendation of the Provisional Administrator on the measures for bank restructuring submitted to the National Bank is approved by it, the Provisional Administrator shall conduct necessary measures according to this Regulation in order to determine specific measures for bank restructuring and address to the National Bank with the application within 20 calendar days.  

54. For the purposes of the evaluation of assets and liabilities of the bank, the Provisional Administrator shall have the right to involve appraisers and other specialists with the payment of their services for the bank’s account. 

55. After the results of evaluation of the assets and liabilities are obtained, the Provisional Administrator shall send a request for the measures on bank restructuring to the National Bank, specified in Clause 49 of the present Regulation. The request of the Provisional Administrator shall contain a conclusion on the financial situation of the bank, information on depositors and creditors of the bank, and the necessity to protect their rights and interests, including the evaluation of the results of the proposed measures on bank restructuring. 

56. The Provisional Administrator shall attach the following documents to the request for bank restructuring without fail: 

- report on the evaluation of assets and liabilities of the bank; 

- plan of actions for bank restructuring. 

57. The plan of actions shall indicate one or several measures for bank restructuring, which the Provisional Administrator proposes to conduct with the indication of specific actions, which are to be carried out and the terms of their carrying out. 

58. The National Bank shall consider the attached documents within 15 working days from the date, on which the request of the Provisional Administrator was received, and shall make one of the decisions provided for by Clause 60 hereof. 

59. Where required, the National Bank shall have the right to require additional information necessary for decision-making. 

60. The National Bank shall make one of the following decisions within 15 working days upon receipt of the request for the measures on bank restructuring from the Provisional Administrator of the bank: 

- to grant the request of the Provisional Administrator and begin a bank restructuring procedure; 

- to refuse in granting the request of the Provisional Administrator and begin a bank liquidation procedure; 

- to refuse in granting the request of the bank and send it for follow-up revision with the compulsory justification of the refusal; 

- to grant the request of the Provisional Administrator with the introduction of amendments in the proposed plan of actions on bank restructuring; 

- to refuse in granting the request of the Provisional Administrator concerning the application of one measure on restructuring and to make a proposal on consideration of other measures on bank restructuring. 

61. In the event the National Bank refuses to grant the request, the Provisional Administrator shall submit the request with the new/elaborated measures on bank restructuring to the National Bank, or make a proposal on bank liquidation within 5 working days. 

62. A decision on granting or refusal to grant the request of the Provisional Administrator shall be made by the National Bank Board with the account of the current situation in the bank, the interests of depositors and creditors of the bank, maintenance of continuity of the functions of the bank systematically important for the banking or payment system, as well as ensuring stability of a banking and financial system. 

Chapter 10. Bank Recapitalization 

63. When carrying out the measures on bank recapitalization, the consent of shareholders and creditors of the bank is not required unless otherwise provided for in this Regulation or by a decision of the National Bank Board. 

64. Bank recapitalization shall be carried out: 

1) by covering losses for account of shares and other capital accounts of shareholders (reserves, retained earnings, capital over nominal, etc.). In this case, shares are canceled; 

2) by covering losses for account of the bank’s liabilities to its shareholders and bank-related parties or converting such liabilities into the bank’s capital. At the same time, such obligations are terminated; 

3) by issuing new shares and selling them; 

4) by attracting a subordinated loan; 

5) through the application of other measures. 

When implementing these measures to recapitalize the bank, the Provisional Administrator shall be obliged to comply with the requirements of the legislation of the Kyrgyz Republic. 

When choosing a method for recapitalizing a bank, the Provisional Administrator should conduct a thorough analysis of the current state of the bank and the expected results that should be obtained as a result of applying a measure for bank recapitalization. 

65. Transformation of bank’s liabilities into equity shall not be allowed with respect to its following obligations: 

1) on deposits subject to protection under the law on the protection of bank deposits; 

2) on claims of creditors secured by a collateral in the amount not exceeding the value of the collateral; 

3) to customers that are recognized separately from the bank’s funds; 

4) on wages, severance pay, as well as liabilities arising from damage to the life and health of a bank employee; 

5) on mandatory payments to the budget and other extra-budgetary funds. 

66. The decision to participate in the recapitalization of a system bank shall be taken by the Government of the Kyrgyz Republic on the recommendation of the National Bank. Recapitalization of a system bank with the attraction of funds allocated by the Government of the Kyrgyz Republic shall be carried out after the measures specified in Sub-Clauses 1 and 2 of Clause 64 hereof. The procedure for taking a decision on the participation of the Government of the Kyrgyz Republic in the recapitalization of a system bank shall be adopted in accordance with the joint regulatory legal act of the Government of the Kyrgyz Republic and the National Bank on the issue of recapitalization of the system bank. 

67. Implementation of recapitalization at the expense of funds or guarantees of the National Bank shall be prohibited. 

68. Other persons may participate in the recapitalization of the system bank with the consent of the National Bank. Persons involved in the bank recapitalization shall comply with the requirements established by the banking legislation. 

69. The Provisional Administrator may send a written proposal for the improvement of the financial condition of the bank to the bank’s participants (shareholders). 

Participants and creditors of the bank can make proposals to the Provisional Administrator on the capitalization of the necessary amount of money to restore the solvency of the bank. At the same time, the Provisional Administrator in consultation with the National Bank shall determine the necessary amount and term of its deposition. 

70. In the event that participants or creditors of the bank provide a plan of measures to improve the financial condition of the bank, the Provisional Administrator shall submit a conclusion to the National Bank Board on this plan of actions. 

71. If the request of the Provisional Administrator for recapitalization measures is granted, the Provisional Administrator shall be obliged to submit a weekly report to the National Bank on the activities carried out, indicating the actions taken/uncompleted and the possible risks. 

Chapter 11. Transfer and Sale of Assets and Liabilities of the Bank 

72. The transfer or sale of the bank’s assets and liabilities is carried out if, according to the National Bank’s assessment: 

1) there is a real threat of bankruptcy recognition and failure to take such a decision can worsen the situation of depositors and other creditors not related to the bank; 

2) such a decision is the best way to ensure the protection of depositors and other creditors not related to the bank, as well as the safety of the deposit base; 

3) this measure is necessary to maintain the stability and security of the financial and banking system and to prevent undermining public confidence in banks. 

The above assessment shall be carried out by the National Bank based on the information provided by the Provisional Administrator. After the assessment, if the grounds specified in Sub-clauses 1 to 3 of this Clause are revealed, the supervisory authority shall submit the matter to the National Bank Board for consideration. 

73. When transferring or selling the assets and liabilities of a bank, all or part of the bank’s assets and liabilities may be transferred or sold in any amount and in any ratio subject to the requirements of the Law. 

74. The list of assets and liabilities that can be transferred or sold shall be prepared by the Provisional Administrator, and shall be submitted with a request to the National Bank. 

The message on the transfer or sale of assets and liabilities of the bank shall be published by the National Bank in the mass media and on the website of the National Bank. 

75. The transfer or sale of assets and liabilities of the bank shall be carried out on the market terms. The proceeds from the sale of bank assets shall be directed to a restructured bank. 

76. In case of transfer or sale of bank assets and liabilities, a person who accepts or buys them shall have appropriate licenses and/or permits. 

77. The transfer or sale of assets and liabilities of the bank does not require the consent of the creditors and shareholders of the bank, as well as any other concerned persons. 

78. Transfer or sale of bank assets and liabilities does not violate the rights of depositors and other creditors. 

79. The bank’s obligations for deposits subject to protection according to the law on the protection of bank deposits are subject to transfer as a matter of priority. 

80. The creditors, shareholders of the bank and other persons whose property, liabilities and rights are not transferred or sold, shall not be entitled to pretend or claim their rights for assets, liabilities and rights transferred or sold to others for any reasons. 

81. In the course of implementing measures to transfer or sell assets and liabilities of the bank, the funds of the Deposit Protection Fund may be used in the amount and on the terms agreed between the authorized deposit protection authority and the National Bank.  

82. The funds of the Deposit Protection Fund are used when transferring liabilities for deposits to another bank only with respect to deposits subject to protection according to the law on the protection of bank deposits. 

The Provisional Administrator shall send full information on the transfer of liabilities to the authorized body for the protection of deposits within one working day from the date, on which the National Bank granted a request for transfer of liabilities for the deposits to another bank. 

Chapter 12. Establishment of a “Transition” Bank 

83. The Provisional Administrator shall be entitled to establish a “transition” bank based on the assets and liabilities of the restructured bank with the consent of the National Bank. 

84. State registration of a “transition” bank as a legal entity and issuance of a license of the National Bank shall be made within seventy-two hours from the date of application to the authorized state body. 

85. The procedure for issuing a license of a “transition” bank shall be established by the regulatory legal acts of the National Bank on licensing of banks. 

86. The official publication on the establishment of a “transition” bank shall be made no later than the next day after the issuance of the license of the National Bank. 

87. The Provisional Administrator shall be obliged to sell the shares of the “transition” bank by any available means as soon as possible, but not later than one year from the date of its establishment. According to the decision of the National Bank, the period for the sale of shares of the “transition” bank can be extended only once for up to one year. In the event that the shares of the “transition” bank are not sold within the prescribed period, then it is subject to liquidation. All information related to the sale of shares of the “transition” bank should be open and transparent; the implementation shall be carried out on market conditions, without giving preferences to individual buyers. 

88. The proceeds from the sale of shares of the “transition” bank shall be sent to the restructured bank. 

89. The consequences of the introduction of the Provisional Administration provided for by the Law and this Regulation do not apply to the “transition” bank. 

90. From the date of establishment, the “transition” bank shall acquire the status of a participant in the deposit protection system without an entry fee. 

91. The “transition” bank as a legal entity is not the legal successor of a restructured bank and is not liable for any of its liabilities, other than those liabilities that were transferred to it in accordance with the Law and this Regulation. 

92. Transfer of assets and liabilities to the “transition” bank shall be made according to the rules of the section “Transfer and sale of bank assets and liabilities” of this Regulation. 

93. In order to organize the work of the “transition” bank, the Provisional Administrator has the right to invite the employees of the restructured bank to move to a “transition” bank for the positions indicated in the proposal of the Provisional Administrator. 

94. The Provisional Administrator is the founder of the “transition bank” without the right to receive dividends and other personal benefits, except payments in accordance with this Regulation. 

95. The requirements of the National Bank for compliance with economic standards and the formation of the authorized capital shall not be subject to the “transition bank” for the period provided for its implementation. 

96. Within one month of the sale of shares of the “transition bank”, the new shareholder needs to develop a plan of actions for the financial recovery of the “transition bank” to the level of compliance with all requirements of the banking legislation of the Kyrgyz Republic. The maximum period for the implementation of the plan of actions for the financial recovery of the bank cannot exceed 12 months. 

97. Failure to comply with the terms specified in the plan of actions is the basis for applying the enforcement measures to the bank provided for by banking law, including revocation of a license. 

98. When issuing a license to a “transition bank”, the National Bank shall independently determine the list of permitted banking operations, which may be revised during the implementation of the financial recovery plan based on the bank’s request. 

Chapter 13. Representative of a Provisional Administrator in a Branch/Subsidiary of the Bank  

99. The Provisional Administrator may recruit specialists as the representatives of the Provisional Administrator to assist the Provisional Administrator. The Provisional Administrator shall determine the number of representatives of the Provisional Administrator depending on the availability of the bank’s branches, subsidiaries, savings banks and other structural units, as well as the nature and scope of the forthcoming work. Terms of payment, responsibility of the representative of the Provisional Administrator shall be established in accordance with the contract concluded with the Provisional Administrator. 

100. The specialist involved by the Provisional Administrator for the exercise of functions of a representative of the Provisional Administrator shall have at least 2 (two) years of experience in the financial and banking system, and shall not be a person related to the bank or having a conflict of interest. 

101. Appointment of a representative of the Provisional Administrator shall be issued by an order of the Provisional Administrator. The representative of the Provisional Administrator shall commence duties on the day specified in the order on his/her appointment. 

102. The representative of the Provisional Administrator shall give a copy of the order to the head of the branch/subsidiary/savings bank who shall put a signature, specify the date and time of delivery on the second original of the copy, which is kept by the representative of the Provisional Administrator before termination of his/her authorities. 

103. A representative of the Provisional Administrator may be replaced by another person at the direction of the Provisional Administrator, if necessary. 

104. The Provisional Administrator shall communicate the appointment of a representative of the Provisional Administrator to the supervisory authority in advance. 

105. The Provisional Administrator has the right not to appoint a representative of the Provisional Administration to the branch (subsidiary), savings bank and other structural units of the bank and delegate authorities/functions to the head of the branch/savings bank (subsidiary) of the bank and other structural units of the bank with the coordination of all transactions with the Provisional Administrator. 

Chapter 14. Expenses of a Provisional Administrator 

106. The expenses of the Provisional Administration related to its activities shall be carried out for account of the bank to which the Provisional Administration has been introduced. 

107. The remuneration of the Provisional Administrator and the specialists involved by him/her shall be carried out for account of the bank. 

108. The estimate of the expenses of the Provisional Administration shall be drawn up by the Provisional Administrator and shall be agreed with the National Bank. Estimates of the expenses of the Provisional Administration shall be drawn up for the period of the Provisional Administration’s activities determined in accordance with the decision of the National Bank Board on the introduction/extension of the Provisional Administration based on the monthly cost estimate. 

109. The estimate of expenses of the Provisional Administration shall be signed by the Provisional Administrator and submitted for approval to the National Bank no later than 5 working days from the date of the introduction/extension of the Provisional Administration. 

110. The National Bank Board shall decide on the coordination/disagreement of the estimate of expenses of the Provisional Administration within 5 working days from the date of receipt of the said estimate. 

111. The estimate of the expenses of the Provisional Administration should include salaries and contributions to the Social Fund of the Kyrgyz Republic for the payroll of members of the Provisional Administration with the exception of the costs of remuneration for members of the Provisional Administration who are employees of the National Bank and the Deposit Protection Agency. 

112. If necessary, the following expenditure items may also be provided in the estimate: 

- road transport expenses; 

- security expenses; 

- expenses for means of communication; 

- business trips expenses; 

- costs of payment for media services;  

- postal and clerical expenses; 

- expenses of payment for legal services; 

- expenses of payment for external auditor services; 

- payment for services for the valuation of the bank’s property, including immovable property; 

- other expenses. 

113. If the Provisional Administration needs in additional expenses not provided for by the approved estimate of the expenses of the Provisional Administration, the specified expenses may be agreed by the National Bank Board at the request of the Provisional Administrator.  

114. The Provisional Administrator shall submit a report on the expenses of the Provisional Administration together with a progress report within the timeframe established for the progress report. 

115. The National Bank Board shall review the progress report of the Provisional Administration, including the expense report. 

Chapter 15. Receipt and Transfer of Seals, Keys and Documentation of the Bank to the Provisional Administration 

116. Upon arrival of the Provisional Administration to the bank, the head of the bank shall hand over, and the Provisional Administrator shall accept all seals (stamps) and bank keys (including test ones) signing the acceptance certificate or the corresponding register of bank seals and keys. 

The representative of the Provisional Administrator shall receive all bank seals (stamps) and keys (including test ones) in the branch/subsidiary of the bank from the head of the branch/subsidiary signing the acceptance certificate or the corresponding register of bank seals and keys. 

117. The head of the bank and the chief accountant of the bank shall hand over the accounting and other documents of the bank to the Provisional Administrator as a minimum according to the list in accordance with Appendix 1 hereof. 

Receipt and transfer of the specified documentation shall be carried out in the order and the terms established in the decision of the National Bank Board, and shall be executed by the corresponding certificate (certificates). 

The head and the chief accountant of the branch/subsidiary of the bank shall submit the accounting and other documentation of the bank to the representative of the Provisional Administrator as a minimum according to the list in accordance with Appendix 1 hereof. 

118. The signatures of the Provisional Administrator, his/her representatives, as well as the signatures of other persons authorized by the Provisional Administrator to sign the relevant documents, shall be certified by the bank’s seal. 

Chapter 16. Inventory and Revision of Tangible Assets 

119. The Provisional Administrator shall be obliged no later than the working day following the day of the introduction of the Provisional Administration to begin: 

- Inventory in the head office, branches, structural units of the bank of all tangible assets (fixed assets, equipment, etc.) in the bank, including property not belonging to the bank and being in its collateral, in trust management (hereinafter referred to as the inventory). The timing of the inventory shall be determined by the order of the Provisional Administrator depending on the number of branches, other structural units, the scope of the proposed work, but cannot exceed 30 calendar days from the time of the introduction of the Provisional Administration; 

- revision of banknotes, coins and other valuables in cash desks, ATMs, terminals and operating cash desks outside the bank’s cash center, in its branches and representative offices (hereinafter referred to as the audit). The audit should be completed no later than 3 working days from the date of the introduction of the Provisional Administration; 

- reconciliation of accounts in correspondent banks with receipt of confirmation on the accounts of all correspondent banks as of the date of the beginning of the Provisional Administration. 

Also, the Provisional Administrator shall: 

1) conduct reconciliation of: 

- securities recognized at the market or adjusted price; 

- loans, adjustments to the reserve to cover potential damages and losses on receivables in accordance with the Regulation “On Classification of Assets and Related Allocations to the Provision for Potential Damages and Losses” and “On Classification of Assets and Related Allocations to the Provision for Potential Damages and Losses while Conducting Operations in accordance with the Principles of Islamic Banking and Finance” approved by the National Bank Board; 

- other assets recognized at the estimated value; 

2) prepare a balance sheet with the account of adjustments to individual items because of the reconciliation. 

120. Inventory and audit are carried out by a commission, the composition of which shall be determined by the order of the Provisional Administrator. 

121. In case the head of the bank (chief accountant or any other employee of the bank) refused to carry out an audit and/or inventory, participate in the audit and/or inventory commission, the Provisional Administrator shall prepare an Act to Countering the Implementation of the Provisional Administration. 

Carrying out and registration of the results of inventory and audit shall be made according to the procedure established in the order of the Provisional Administrator. 

Chapter 17. Peculiarities of Signing and Acceptance of Payment Documents of the Bank to Execution 

122. The Provisional Administrator shall submit properly signed cards with samples of signatures of the Provisional Administrator and other persons who have been granted the right to sign the payment documents of the bank (in duplicate) to the National Bank within 2 working days (two) days from the day, on which the Provisional Administration has been introduced. 

The representative of the Provisional Administration of the bank, which has branches/subsidiaries of the bank in the regions, shall submit properly issued cards with samples of signatures of the representative of the Provisional Administration and the other persons whom the Provisional Administrator shall grant the right to sign the payment documents of the bank (in duplicate) to the regional office of the National Bank within 2 (two) working days from the day, on which the Provisional Administration was introduced.  

123. Cards with samples of signatures of the bank employees and its branches/subsidiaries, which had the right to sign the payment documents of the bank at the time of the introduction of the Provisional Administration and the appointment of the Provisional Administrator, are considered invalid. These cards are subject to storage in the National Bank and regional offices of the National Bank, respectively. 

124. The right of the first signature on the payment documents of the bank shall belong to the Provisional Administrator and on the payment documents of the branch/subsidiary of the bank - to the representative of the Provisional Administrator. 

The right of the second signature on the payment documents of the bank belongs to the bank’s chief accountant or to the representative of the Provisional Administrator/a person who is part of the Provisional Administration, who exercises the functions as the chief accountant according to the allocation of duties, and on the payment documents of a branch/subsidiary of the bank – to the chief accountant of the branch/subsidiary or other person authorized by the Provisional Administrator upon the proposal of the representative of the Provisional Administration, to exercise the functions of the chief accountant of the branch/subsidiary. 

The Provisional Administrator has the right to decide on retention of functions and right of the first signature on payment documents of the bank’s branch of the bank’s branch head. 

125. Payment documents of the bank and its branches shall be accepted for execution by the structural unit of the National Bank carrying out settlement operations, by institutions providing services on interbank payment and settlement systems and correspondent banks signed by persons specified in Clause 124 hereof. 

126. The specifics of acceptance of the bank’s electronic documents for execution, signed by an electronic digital signature when making settlements with the National Bank shall be determined by the Provisional Administrator upon agreement with the relevant structural unit of the National Bank. 

127. The order and peculiarities of accepting electronic payment documents for the bank signed by an electronic digital signature when making settlements with other banks shall be regulated by the regulatory legal acts of the National Bank. 

Chapter 18. Act on Countering the Implementation of the Provisional Administration 

128. In case the management bodies and/or certain officials and employees of the bank and other bank-related parties counteract the Provisional Administration, which prevents or makes it impossible for the Provisional Administrator to perform the functions assigned to him/her by the Law and this Statute, the Provisional Administrator shall draw up an Act on countering the implementation of the Provisional Administration (according to Appendix 3 hereof). 

Impossibility to exercise the functions of the Provisional Administrator does not cancel or suspend the effect of the decision of the National Bank Board on the introduction of the Provisional Administration. 

129. The Act on countering the implementation of the Provisional Administration shall be drawn up on the day of detection of the fact of opposition signed by the Provisional Administrator (in his absence - by the representative of the Provisional Administrator) and should be sent to the National Bank. 

130. The Act on countering the implementation of the Provisional Administration shall be drawn up and signed by a representative of the Provisional Administrator in the branch/subsidiary of the bank. A copy of the Act on countering the implementation of the Provisional Administration should be sent to the Provisional Administrator. 

131. The Act on countering the implementation of the Provisional Administration is to be registered with the bank as incoming correspondence indicating the date and the incoming number and data of the person who registered the document in a mandatory manner. 

132. The Provisional Administrator has the right to appeal to the law enforcement bodies with a statement on the facts of counteraction of the management bodies of the bank and/or some of its officials and employees and other bank-related parties to the implementation of the Provisional Administration in accordance with the law. 

133. The counteraction of the management bodies of a bank (branch/subsidiary) and/or its separate officers and employees and other bank-related parties to the Provisional Administrator (his/her representatives) is the basis for application of enforcement actions to the bank in accordance with the legislation. 

Chapter 19. Extension of the Provisional Administration 

134. The term of the Provisional Administration may be extended only once by the decision of the National Bank Board in accordance with the Law for a period not exceeding six months. 

135. The supervisory authority shall prepare a letter of notification on the day of taking a decision on the extension of the Provisional Administration, which is communicated in due course to organizations providing services on interbank settlement and payment systems. The letter of notification should contain a notice on the extension of the Provisional Administration indicating the number and date of adoption of the relevant decision of the National Bank Board. 

136. The notice on the extension of the Provisional Administration shall be published in the mass media and on the website of the National Bank. 

Chapter 20. Termination of the Provisional Administration 

137. The Provisional Administration shall be terminated from the date the Resolution of the National Bank Board comes into force on its termination and on the release of the Provisional Administrator from his/her duties. 

The decision of the National Bank Board on termination of the Provisional Administration is taken at the request of the Provisional Administrator or the supervisory authority. The decision of the National Bank Board on the termination of the Provisional Administration may be made in the following cases: 

1) elimination of the reasons that served as the basis for its introduction; 

2) the expiry of the term for which the Provisional Administration was introduced; 

3) appointment of the liquidator by a court decision. 

138. The Provisional Administration may be terminated before the expiration of its introduction by the decision of the National Bank Board. 

139. The powers of the bank officials suspended for the period of the Provisional Administration shall be restored after the termination of the activities of the Provisional Administrator if these persons were not dismissed in accordance with the legislation of the Kyrgyz Republic and if there is no requirement of the National Bank to change the bank officials. 

140. The Provisional Administrator shall hand over, and the head of the bank shall accept seals (stamps), keys, accounting and other documentation of the bank in accordance with Appendix 1 hereof within the agreed terms after restoration of the powers of the bank officials. 

Acceptance and transfer of seals (stamps), keys, accounting and other documentation of the bank shall be executed by the relevant act (acts). 

141. The Bank shall submit duly executed cards with samples of signatures of the bank officials, as well as other persons who own the right to sign the payment documents of the bank (in duplicate) to the National Bank within 2 (two) days after the termination of the Provisional Administration. 

142. Upon termination of the powers of the Provisional Administrator pursuant to Sub-clause 3 of Clause 137 hereof, the Provisional Administrator shall immediately transfer the control over the bank and its assets, as well as seals, keys, accounting and other documentation to the liquidator appointed by the court. 

Acceptance and transfer of seals (stamps), keys, accounting and other documentation of the bank shall be by the relevant act (acts). 

The Provisional Administrator shall transfer a list of depositors of individuals and other creditors of the bank, including a list of affiliates with the bank to the liquidator appointed by the court. 

143. The Provisional Administrator shall prepare and submit a final report to the National Bank within 30 calendar days after the termination of his/her powers with the application of accounting data during the Provisional Administration. 

144. The agreement concluded between the National Bank and the Provisional Administrator shall cease to be effective after the Provisional Administrator submits to the National Bank a final report. The agreement with the Provisional Administrator should contain provisions for its termination in accordance with this Clause. 

145. The supervisory authority shall prepare a letter of notification on the day when the decision to terminate the Provisional Administration is made, which is communicated in due course to organizations providing services on interbank settlement and payment systems. 

146. The notice on the termination of the Provisional Administration is published in the mass media and on the website of the National Bank. 

  

Appendix 1  to the Regulation on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

MINIMUM LIST 

of Documentation of the Bank (Branch/Subsidiary) Subject to Compulsory Acceptance and Transfer at the Beginning and Termination of the Provisional Administration  

1. Constituent documents of the bank (branch/subsidiary). 

2. Certificate of state registration (re-registration) of the bank (branch/subsidiary). 

3. Licenses for banking operations of the bank, as well as for professional activities in the securities market and other licenses, permits. 

4. The staff list of the bank (branch/subsidiary), the list of employees of the bank (branch/subsidiary) indicating the position, the structural unit in which they work, the official salary, the list of vacant posts, as well as personnel files and work books of bank employees. All orders for personnel and main activities. 

5. The list of branches, representative offices and subsidiaries (including those located abroad) indicating their location. 

6. The balance sheet of the bank (branch/subsidiary) as of the date of appointment/termination of the Provisional Administration in general for the bank and in the context of branches, as well as reporting on off-balance accounting. 

7. The list of the bank customers (branch/subsidiary) with the indication of account number, the number of a legal file indicating the number of sheets in each file (legal files should contain record statements). 

8. Documentation on issued guarantees, letters of credit and other obligations of the bank. 

9. Agreements for all transactions entered into by the bank (branch/subsidiary), including business agreements. 

10. Agreements on the establishment of correspondent relations, ciphers of electronic payments and signature analogs, including test keys. 

11. Credit files and other dossiers maintained by the bank (branch/subsidiary), certificates for collateralized property, guarantee and other off-balance sheet liabilities issued by the bank. 

12. All available reports on audits conducted in the bank by external auditors. 

13. A book of records of powers of attorney, as well as copies of powers of attorney issued to the bank employees, heads of branches, subsidiaries, representative offices and third parties. 

14. All protocols and decisions of the bank’s executive body, regulatory documents and books of records of these documents. 

15. All minutes of the meetings of the Board of Directors and meetings of the bank’s owners (shareholders). 

16. Documents control register of the bank (branch/subsidiary). Incoming and outgoing correspondence of the bank with the National Bank, bank customers, organizations. 

17. Journal of registration of contracts, agreements and arrangements concluded by the bank (branch/subsidiary). 

18. Samples of signatures of persons who have the right of first and second signatures on payment documents, as well as the signatures on credit and other contracts, labor agreements and arrangements entered into by the bank (branch/subsidiary). 

19. Estimate of administrative and business expenses of the bank (branch/subsidiary). 

20. A list of claims, actions and writs of execution filed against the bank (branch/subsidiary) in judicial and extrajudicial procedure with the indication of the sum, as well as the claims of the bank to others. 

21. Inventory sheet of fixed assets, perishable items, other assets, as well as documents, archives (transferred after the inventory is completed). 

22. Corporate letterheads (or other forms of the documents containing business name and other bank details) used to send official requests to the bank. 

23. All reports on the targeted and complex inspections carried out at the bank. 

23. Any other documents that shall be transferred by the management of the bank (branch/subsidiary) in the opinion of the Provisional Administrator. 

24. The Provisional Administrator shall have the right to demand additional documents and the documents confirming the authenticity of the documents specified in this list from the management of the bank (branch/subsidiary). 

  

Appendix 2  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

MINIMUM REQUIREMENTS 

to the Progress Report of the Provisional Administrator 

1. The monthly report should include: 

1) the balance sheet of the bank as of the closing date of the reporting month; 

2) the form “Financial Position Balance Sheet” as of the closing date of the reporting month compiled in accordance with the requirements of the Regulation “On Requirements for the Formation of Financial Statements of Commercial Banks of the Kyrgyz Republic”; 

3) a report on the actual repayment of outstanding principal amount of credits and interest for the reporting month in comparison with the planned repayment schedule, a repayment schedule for the coming month (by week); 

4) the structure of the deposit liabilities of the bank as of the closing date of the reporting month in the following categories: individuals and legal entities, demand and forward liabilities, in national and foreign currency, as well as the information on the number of depositors and customers’ accounts; 

5) the forecast for the repayment of the bank’s deposit liabilities for the coming month (by weeks); 

6) classification of assets, reserves created by the bank for overdue loans; 

7) other data, which are necessary for submission as part of the monthly report (on demand) in the opinion of the NBKR. 

The monthly report should reflect the information about: 

- the measures undertaken by the Provisional Administration to increase the bank’s capital; 

- the measures to improve and increase the liquidity of the bank; 

- the conclusion of the Provisional Administrator on the probability of bank recovery. 

In addition, the monthly report should contain a brief explanatory note. This note shall indicate the information on changes in the structure and number of staff of the bank and its branches (subsidiaries), on the appointment and dismissal of bank employees, on changes in the composition of the representatives of the Provisional Administration. 

The brief explanatory note should also contain: 

- information on the main measures for the financial recovery of the bank conducted during the reporting period in accordance with the developed plan, an explanation of the reasons for the failure to implement the measures and (or) implementation out-of-time specified in the plan; 

- information on the counteraction of the management bodies and (or) certain employees of the bank (its branch/subsidiary) to the Provisional Administration (its representatives) in the course of fulfilling its functions; 

- information on the largest transactions of the bank (conducted by the bank in this period, analysis of the effectiveness of these activities and transactions, assessment of the financial situation of the bank and information on activities planned for the next reporting period; 

- information on requirements for off-balance sheet liabilities of the bank. 

2. The report for the entire period of the Provisional Administration should include all data characterizing changes in the main financial indicators of the bank’s activity (own funds (capital), assets, liabilities, capital adequacy ratios, liquidity indicators, etc.) for the entire period of the work of the Provisional Administration, and also substantiated conclusions about the results of the tasks performed by the Provisional Administration assigned to it (forecast of the consequences of the Provisional Administration, etc.). 

3. Copies of orders and instructions of the Provisional Administration shall be attached to the report of the Provisional Administration for the entire period. 

4. The report shall be signed by the Provisional Administrator. 

  

Appendix 3  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

ACT 

On Countering the Implementation of the Provisional Administration 

_______________________________________________________________________________________ 

                                                 (name of a commercial bank 

_______________________________________________________________________________________ 

                                          (branch, subsidiary, savings bank)) 

_______________________________________________________________________________________ 

                               (location of the bank (branch, subsidiary, 

_______________________________________________________________________________________ 

                                            POS, savings bank), address, telephone) 

  

__________________________         (place of issue)

"___" __________________ 20__

  

I, the Provisional Administrator/representative of the Provisional Administrator 

____________________________________ (Full name) before the undersigned: 

1. ________________________________________________________________________________________ 

2. ________________________________________________________________________________________ 

3. ________________________________________________________________________________________ 

has drawn up the Act that the commercial bank represented by: 

_______________________________________________________________________________________ 

                               (Full name of the head, official/employee/employees of the bank) 

counteracted the implementation of the Provisional Administration: 

_______________________________________________________________________________________ 

                    (did not provide an access to the building of the bank, did not provide the documents of the bank required by the Provisional 

_______________________________________________________________________________________ 

           Administrator/representative of the Provisional Administrator and others) 

The employee/s of the bank is/are aware of the banking liability and its officials for prevention of the Provisional Administration. 

The Act is drawn up: 

_______________________________________________________________________________________ 

        (Full name of the Provisional Administrator/representative of the Provisional Administrator) (Signature) 

  

Read: 

_______________ (Full name of the bank employee) _____________(position) _____________ (Signature) 

The second copy of the Act is received by _____________(Full name of the bank employee)____ (Signature) 

  

Officials of the bank _________________________________________ (Full name of the bank employee/s) 

refused to review the content of the Act on Countering the Implementation of the Provisional Administration. 

_______________________________________________________________________________________ 

(Full name of the Provisional Administrator/representative of the Provisional Administrator) (Signature) 

  

Appendix 4  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

PROCEDURES 

on Carrying Out Certain Activities by the Provisional Administrator (His/Her Representatives) during the Provisional Administration  

1. Upon arrival at the bank, the Provisional Administrator shall withdraw the cash balance in the cash desk and the depository and draw up the act in 3 (three) copies. 

2. Upon arrival at the bank, the Provisional Administrator shall seal the depository and the cash desk of the bank, all safes, fireproof cabinets and locked safes. 

3. Upon arrival at the bank, the Provisional Administrator shall seal the entire bank’s documentation, including the archive. 

4. Upon arrival at the bank, the Provisional Administrator shall issue the following orders: 

1) on suspending the activities of the Board of Directors and the Management (executive body) of the bank and transferring their powers to the Provisional Administration; 

2) on the mode of payments; 

3) on granting the right to sign all documentation coming from the bank to the Provisional Administrator; 

4) prohibiting all employees of the bank from performing any material actions without the written permission of the Provisional Administrator. 

5. The Provisional Administrator shall issue an order notifying the bank’s security service about the ban on the removal of property and documents from the bank without the written permission of the Provisional Administrator, as well as the order to restrict the admission of persons out of hours in order to ensure the safety of property, material values ​​and documents held by the bank. 

6. The Provisional Administrator shall issue an order on the administrative and material responsibility of all bank employees for the safety of property, material values, documentation and other valuables. 

7. The Provisional Administrator shall issue an order to create a commission at the bank, which is responsible for sealing the bank building at the end of the working day. The commission consists of the Provisional Administrator (representatives of the Provisional Administrator and/or members of the Provisional Administration) and bank employees. 

8. The Provisional Administrator should notify each bank employee personally about possible dismissal in accordance with the current labor legislation. 

9. The Provisional Administrator shall be obliged to apply to the National Bank for renewal of keys, safe keys, passwords the Security Service of the National Bank that are used by for creation of a digital signature in electronic documents and for access to automated systems. 

10. If necessary, the Provisional Administrator has the right to apply to the National Bank with a request to use technical means belonging to the National Bank. 

11. During the inventory and audit conducted in the bank in accordance with the requirements of Clause 119 of this Regulation, the Provisional Administrator is entitled to be guided by the procedure for conducting and recording the results of the inventory, which is used in the National Bank. 

  

Appendix 5  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of   June 8, 2017

REQUIREMENTS 

to the Insurer and Civil Liability Insurance Terms of the Provisional Administrator  

1. The professional liability of the Provisional Administrator shall be insured within one month from the date of adoption of the Board resolution on the appointment of the Provisional Administrator. 

2. The limit of liability, the risks subject to insurance shall be determined by the National Bank, depending on the size of the bank, the scale of the bank’s operations, the branch network, the bank’s staff strength and other factors. 

3. The insurance shall cover the entire period of the Provisional Administrator’s activity for which he/she is appointed and one calendar year after the end of the period of his/her activity. 

4. The insurance company shall meet the following requirements: 

- have a valid license of the authorized state body for regulation and supervision of the financial market of the Kyrgyz Republic for the right to implement the corresponding type of liability insurance; 

- to carry out its activities as an insurance organization for at least three years; 

- no losses during the last calendar year; 

- fulfillment of prudential standards for the insurance organization for all reporting dates during the last calendar year; 

- not be in the procedure of bankruptcy and the Provisional Administration. 

  

Appendix 6  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of  June 8, 2017

INFORMATION 

on Personal Data and Business Interests 

Surname, Name, Patronymic (in full): ________________________________________________________ 

Date of birth:____________________________________________________________________________ 

Place of birth: ___________________________________________________________________________ 

Passport No. _________________________________ Date of issue ________________________________ 

Date of expiry: __________________________________________________________________________ 

Place of issue __________________________________________________________________________ 

Home address (place of residence):___________________________________________________________ 

Place of residence registration: _____________________________________________________________ 

Home number: __________________________________________________________________________ 

Cellular phone: _________________________________________________________________________ 

 

Table No.1. Information on the closest relatives (husband/wife, parents, parents of a husband/wife, children, whole blood brothers and sisters, grandmothers and grandfathers) 

No.	Full name	Degree of relationship	Date of birth	Place of work	Position	Period in the position	Place of residence

Table No. 2. Information on other related persons (individuals) 

No.	Full name of a related person	Place of work	Position	Degree of interrelationship

Table No.3. Information on business interests of the Provisional Administrator and his/her closest relatives and other related persons 

No.	Full name	Name of a legal entity	Share of ownership	Relation of a person to a legal entity

I hereby certify that the information provided by me is true. In the event of any changes, I am obliged to provide the updated information. 

___________________________ (signature) 

___________________________ (date) 

  

Appendix 7  to the Regulations on Provisional Administration approved by Resolution No.2017-P-12/23-8-RLA of the National Bank of the Kyrgyz Republic Board as of  June 8, 2017

 

 

QUESTIONNAIRE 

1. Full name ____________________________________________________________________________ 

2. Indicate the position for which your candidature is proposed:___________________ (position, bank name) 

3. If you changed your surname, indicate when and for what reason, and indicate the previous  

surname(-s) _____________________________________________________________________________ 

4. Date and place of birth ___________________________________date, month, year; city, village, country 

5. Passport series ______ number ________issuing authority ________ date of issue ___________________ 

6. Citizenship ___________________________________________________________________________ 

Indicate how it was received: at the place of birth, after marriage, on other circumstances - to clarify _______________________________________________________________________________________ 

7. Home address (according to the documents), ____________________________Tel. number.__________ 

Actual place of residence __________________________________________________________________ 

8. Information on the candidate’s knowledge in the field of: 

- banking legislation __________________________________________________________________; 

- bank risks’ management _______________________________________________________________; 

- regulatory legal acts of the National Bank ________________________________________________. 

 9. Education _______________(higher, incomplete higher, vocational school, secondary, bachelor, master) 

Name of educational institution and its location

Faculty or department

Year of admission and graduation

Specialty according to the diploma obtained

10. Work from the beginning of professional life stages 

Entry date (month, year)

Date of withdrawal (month, year)

Position held

Name of institution, location, Full name of employer

Reason of withdrawal

11. Indicate whether:  

- any charges in commission of administrative violations, including in the events of termination of a case or withdrawal of a charge have been filed (yes/no) ___________________ 

- disciplinary actions taken (yes/no) _________________ 

- accusations in the commission of crimes in accordance with the criminal legislation, including the events of termination of a criminal case, entry of a judgement of acquittal and relief from criminal responsibility brought (yes/no) __________________ 

against you or the company you have been associated with as a significant participant and/or a member of the Board of Directors or any other official ever, in any country. 

If so, please describe the charge, the conviction of the law enforcement agency indicating the 

name of a law enforcement agency, the charge or disciplinary penalty applied by 

any state body, the results of the proceedings, the court’s decision: 

_______________________________________________________________________________________ 

12. Indicate whether there is an outstanding conviction. If so, provide an explanation 

_______________________________________________________________________________________ 

13. Indicate whether there has been a decision prohibiting you to carry out any professional activity. If so, provide an explanation 

_______________________________________________________________________________________ 

14. Indicate each company that is recognized either as a bankrupt in an enforcement procedure or is in the process of compulsory liquidation, which you were associated with as the head (manager), an official (member of the Board of Directors, member of the executive body, chief accountant /financial manager, etc.) or a significant participant  

_______________________________________________________________________________________ 

Provide a detailed justification of your role and responsibilities as a director, official or a significant participant in the company, which you were associated with, and which was placed in the circumstances connected with compulsory bankruptcy, liquidation 

______________________________________________________________________________________ 

15. Was it conducted an investigation against you or the company, which you were associated with as an official (member of the Board of Directors, member of the executive body, chief accountant/financial manager, etc.) 

or a significant participant by the government or regulatory authorities. If so, provide an explanation  

for what reason 

_______________________________________________________________________________________ 

16. Are you currently participate in an judicial proceedings. If so, provide an explanation _______________________________________________________________________________________ 

I, _____________________________________________________________________________________, 

surname, name, patronymic, 

hereby, certify that the above information in the questionnaire is true and complete and 

provided in accordance with my knowledge and information on the questions indicated in the questionnaire. 

I admit that if there are intentional distortions and omissions on my part, it can 

serve as the basis for refusal to agree on the recommended position and entail 

responsibility in accordance with the Law. 

__________________ “___” __________________ signature date