The National Bank of Kazakhstan has developed new measures to tighten domestic banks. The regulator has prepared a concept to the draft law "On introducing amendments and additions to some legislative acts of the RoK on issues related to the provision of financial services," Zakon.kz IA informs with reference to the National Bank.
In particular, the document proposes to establish a number of prohibitions and restrictions for Kazakhstan banks, including: - establishment of a special procedure for money distribution when repaying overdue debts on loans; - establishment of a ban on the collection of fees related to the issuance and service of banking, microfinance loans; - changing the maximum size of a forfeit or other kinds of penalties for early repayment of loans depending on the term of a loan; - establishment of common time bases for the calculation of interest on loans and so on.
In addition, previously the National Bank adopted a number of amendments to the RoK legislative acts that improve the rights and legal interests of consumers of financial services. In particular: - for the first time in the CIS, banks are obliged to disclose the annual effective interest rate in the bank loan/deposit contracts and when spreading information on the size of interest on loans and deposits.
This indicator represents a real value of a loan or deposit; - during the crisis (in 2008) a three-year ban (moratorium) was imposed which prohibits banks from changing unilaterally the fixed interest rates of bank loans to individuals in connection with the presence of such practices in bank loan agreements; - in February 2011 the Law of the Republic of Kazakhstan "On making amendments and additions to some legislative acts of RoK on mortgage lending and protection of the rights of consumers of financial services and investors' established:
— maximum size of an annual effective interest rate; - a ban on unilateral changes of terms of bank loan agreements; - a ban on the indexation of payments tied to any currency equivalent; - limiting the size of the penalty for non-fulfillment of obligations under bank loan contracts: not more than 0.5% of the overdue amount per day, but not more than 10% of the amount of a granted loan for each effective year of the bank loan contract; - a ban on the introduction of new commissions under concluded loan agreements; - a ban on the imposition of a fine for partial or full early repayment of a loan after one year from the date of issuance of the bank loan; - a ban on extrajudicial sale by banks of pledged immovable assets in the presence of an appropriate written waiver of a pledger – physical person, extrajudicial sale by micro-credit organizations and credit unions of pledged immovable property which is a house and (or) land plot with a dwelling located thereon. The Law introduces an obligation of a pledge holder to conduct an independent assessment of pledged property whenever it needs to be sold.
The regulator also reports that in the current year the National Bank applied 79 limited pressure measures for the violation of the rights of consumers of financial services. Also in the 1st half of 2014 the country’s main bank received 5,832 appeals of citizens and legal persons for consideration.
"In February 2014 the National Bank created a working committee to address problems of borrowers. In the presence of a constructive dialogue, (in cases where a borrower confirms a possible minimum amount of monthly repayment, and/or are referred to socially vulnerable groups (people with disabilities, survivors, families with many children, and so on) the banks provide preferential terms of loans repayment, write off a penalty at 100%” – the bank informs.
Furthermore, in October 2014 the National Bank opened the Public Chamber where every consumer of financial services can apply to for a consultation and clarification of the current legislation in the banking, insurance and pension sectors, as well as in the sphere of securities market.
Name of “MinTax” used in this proposal, depending on the context, can refer to MinTax LLP or MinTax Audit LLP and to its structural subdivisions as well. MinTax LLP and MinTax Audit LLP are included into MinTax Group acting on the basis of the Partnership Agreement, and are considered to be separate and independent legal entities founded under the Republic of Kazakhstan legislation, and they are responsible for all rights and obligations only on their behalf. The Companies which are included in MinTax Group are not responsible for any actions or omissions of each other
CONFIDENTIALITY | LEGAL ASPECTS