Article 13-1. Opening of a branch of a non-resident bank of the Law on Banks and Banking Activities in the Republic of Kazakhstan

Home / RLA / Article 13-1. Opening of a branch of a non-resident bank of the Law on Banks and Banking Activities in the Republic of Kazakhstan

1. A non–resident bank of the Republic of Kazakhstan has the right to apply to the authorized body for permission to open a branch in the territory of the Republic of Kazakhstan if the following conditions are met:

1) the total assets of a non–resident bank of the Republic of Kazakhstan should not be less than the amount equivalent to ten billion US dollars;

2) a non–resident bank of the Republic of Kazakhstan must be a legal entity according to the legislation of the state of which it is a resident;

3) the State of which the non–resident bank of the Republic of Kazakhstan is a resident is a participant in international cooperation in the field of preventing and countering the legalization (laundering) of proceeds from crime and the financing of terrorism, and also cooperates with the Financial Action Task Force on Money Laundering (FATF);

4) the presence of consent (permission) for a non–resident bank of the Republic of Kazakhstan to open a branch in the territory of the Republic of Kazakhstan, issued by the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident, in cases where such consent (permission) is required by the legislation of such state;

5) a non–resident bank of the Republic of Kazakhstan has a valid license (valid permit) to conduct banking and other operations issued (issued) by the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident;

6) a non–resident bank of the Republic of Kazakhstan has the minimum required rating from one of the rating agencies, the list of which is established by a regulatory legal act of the authorized body;

7) the non–resident bank of the Republic of Kazakhstan has no violations of equity capital adequacy ratios and liquidity ratios established by the legislation of the state of which the non–resident bank of the Republic of Kazakhstan is a resident during the last twelve months preceding the date of filing an application for permission to open a branch in the territory of the Republic of Kazakhstan.

2. An application for a permit to open a branch of a non–resident bank of the Republic of Kazakhstan is submitted in the form prescribed by a regulatory legal act of the authorized body, with the following documents and information attached:

1) notarized copies of the founding documents of a non–resident bank of the Republic of Kazakhstan;

2) copies of documents confirming the authority of the person to submit the application and the documents attached to it;

3) a copy of the current license (current permit) of a non–resident bank of the Republic of Kazakhstan for conducting banking and other operations, issued (issued) by the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident, indicating the list of banking and other operations permitted under the license (permit);

4) copies of the decision of a non–resident bank of the Republic of Kazakhstan on opening a branch in the territory of the Republic of Kazakhstan, which contains, among other things, decisions on the following issues:

on acceptance by a non–resident bank of the Republic of Kazakhstan of responsibility for obligations arising in the course of carrying out the activities of its branch in the territory of the Republic of Kazakhstan, and on accounting for such obligations on the balance sheet of a non–resident bank of the Republic of Kazakhstan;

on approval of the amount of assets of a branch of a non–resident bank of the Republic of Kazakhstan accepted as a reserve in accordance with the second part of paragraph 6 of Article 42 of this Law;

5) copies of the consent (permission) to open a branch of a non–resident bank of the Republic of Kazakhstan in the territory of the Republic of Kazakhstan issued by the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident, or copies of confirmation from the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident, that such consent (permission) is not required;

6) information on persons who directly or indirectly own ten or more percent of shares (stakes in the authorized capital) of a non–resident bank of the Republic of Kazakhstan and persons exercising control over a non–resident bank of the Republic of Kazakhstan, as provided for by a regulatory legal act of the authorized body, as well as copies of documents confirming this information;

7) copies of the annual financial statements of a non–resident bank of the Republic of Kazakhstan (consolidated financial statements if a non–resident bank of the Republic of Kazakhstan has subsidiaries) for the last two financial years, confirmed by audit reports, as well as copies of the financial statements of a non–resident bank of the Republic of Kazakhstan for the last completed quarter before submitting the application.

If there is no audit report confirming the financial statements for the last completed financial year from January 1 to June 1 of the current year, the non–resident bank of the Republic of Kazakhstan submits copies of the financial statements (consolidated financial statements if the non–resident bank of the Republic of Kazakhstan has subsidiaries) for the last completed financial year and the last completed quarter before by submitting an application, as well as copies of the annual financial statements (consolidated financial statements, if available to the bank – non-resident of the Republic of Kazakhstan subsidiaries), confirmed by audit reports for the two years preceding the last completed financial year.

The financial statements specified in this subparagraph shall not be submitted in cases where these financial statements are posted and available in Kazakh, Russian or English on the Internet resource of a non-resident bank of the Republic of Kazakhstan or a foreign stock exchange.;

8) brief information about the senior staff of the non–resident bank of the Republic of Kazakhstan in the form established by the regulatory legal act of the authorized body.

The requirements for the submission of documents confirming the information specified in subparagraph 6) of part one of this paragraph, as well as the documents provided for in subparagraph 8) of part one of this paragraph, do not apply to a non–resident bank of the Republic of Kazakhstan if it has a credit rating of at least "A-" of one of the rating agencies, the list of which is established by the regulatory a legal act of the authorized body.

The authorized body has the right to request additional information or documents necessary for making a decision on granting permission to open a branch of a non–resident bank of the Republic of Kazakhstan.

An application for a permit to open a branch of a non–resident bank of the Republic of Kazakhstan may be withdrawn by the applicant at any time after its consideration by the authorized body.

The procedure for issuing a permit to open a branch of a non–resident bank of the Republic of Kazakhstan is determined by a regulatory legal act of the authorized body.

3. A refusal to issue a permit to open a branch of a non–resident bank of the Republic of Kazakhstan is made on any of the following grounds:

1) non-compliance with the requirements established by paragraph 1 of this Article;

2) unreliability of information and information in the documents submitted for obtaining a permit;

3) non–compliance of the name of the branch of a non-resident bank of the Republic of Kazakhstan with the requirements established by paragraph 2 of Article 4-1 of this Law;

4) failure to eliminate the comments of the authorized body on the submitted documents within the time limit set by it;

5) the lack of an impeccable business reputation among the senior staff of a non–resident bank of the Republic of Kazakhstan opening a branch in the territory of the Republic of Kazakhstan.

The authorized body shall notify the non–resident bank of the Republic of Kazakhstan in writing of the grounds for refusal.

3-1. The authorized body revokes the permission to open a branch of a non–resident bank of the Republic of Kazakhstan in case of identification of false information and information in the documents on the basis of which the permit was issued.

When revoking a permit to open a branch of a non–resident bank of the Republic of Kazakhstan, the authorized body decides to revoke the previously issued permit within two months from the date of discovery of the fact that is the basis for revoking the permit.

4. The issued permission to open a branch of a non-resident bank of the Republic of Kazakhstan is considered cancelled in the following cases::

1) adoption by a non-resident bank of the Republic of Kazakhstan of a decision on the voluntary termination of the activities of a branch of a non-resident bank of the Republic of Kazakhstan;

2) suspension or deprivation of a non–resident bank of the Republic of Kazakhstan of a license (permit) to conduct banking and other operations issued (issued) by the financial supervisory authority of the state of which the non–resident bank of the Republic of Kazakhstan is a resident;

3) failure to register with the Corporation within two months from the date of granting permission to open a branch of a non-resident bank of the Republic of Kazakhstan;

4) failure to obtain a license to conduct banking and other operations within one year from the date of issuing a permit to open a branch of a non–resident bank of the Republic of Kazakhstan.

5. An application for a permit to open a branch of a non-resident bank of the Republic of Kazakhstan is considered by the authorized body within sixty-five working days from the date of submission of the application.

Notification of the issuance of a permit to open a branch of a non-resident bank of the Republic of Kazakhstan is sent to a non-resident bank of the Republic of Kazakhstan and to the Corporation.

The authorized body keeps records of issued permits for opening a branch of a non-resident bank of the Republic of Kazakhstan.

Permission to open a branch of a non-resident bank of the Republic of Kazakhstan shall have legal force until the authorized body decides to grant a license to a branch of a non-resident bank of the Republic of Kazakhstan to conduct banking and other operations, or until one of the cases provided for in paragraphs 3-1 or 4 of this Article occurs.

6. The registration of a branch of a non-resident bank of the Republic of Kazakhstan is carried out by the Corporation on the basis of the permission of the authorized body to open a branch of a non-resident bank of the Republic of Kazakhstan.

The Law of the Republic of Kazakhstan dated August 31, 1995 No. 2444.

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Republic of Kazakhstan

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