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NBU substitutes the loan assignment prohibition with enhanced control over cross-border loan agreements registration
Asters, Kyiv, Ukraine,
Tue, Jan, 5, 2016
By its Resolution No. 996, dated 30 December 2015, the National Bank of Ukraine (the "NBU") cancelled the prohibition of assignment of cross-border and domestic loans denominated in foreign currency introduced on 20 August 2015.
The cancelled loan assignment prohibition has been substituted with an enhanced control over the registration of cross-border loan agreements and amendments thereto. Pursuant to Resolution No. 996, the bank servicing payments under the loan agreement must require additional documents (the "Additional Documents") from the Ukrainian borrower and submit them to the NBU if the transaction meets any of the following criteria:
Resolution No. 996 does not provide for an exhaustive list of Additional Documents. Instead, some Additional Documents are defined as "documents confirming the economic viability of the transaction" or "documents confirming the origin of amounts to be utilized for the repayment of the loan (including principal, interest, etc.)".
The set of documents including Additional Documents must be reviewed and analyzed by the NBU to reveal whether the servicing bank has provided untrue or invalid documents or conclude whether the transaction processed by the servicing bank may threaten the interests of the depositors or other creditors of the servicing bank.
The NBU has extended the terms during which the set of documents submitted for the registration must be reviewed by the servicing bank and the NBU:
The new rules introduced by Resolution No. 996 shall become effective on 11 January 2016.