The National Bank appeals to the borrowers to resolve troubles with loan repayment within the legal framework    

During the events, which occurred in Karakol on October 7, 2013 there were borrowers among the protesters who declared their requirements as they could not repay their indebtedness to the financial institutions for a long time and applying aggravated political situation they appealed to honest borrowers not to comply with the contractual requirements. Several dozens of people, who allegedly were the representatives of “Peoples movement for protection of the borrowers right in the Kyrgyz Republic”, appealed to stop operation of the micro financing institutions and commercial banks in the country.    

The National Bank of the Kyrgyz Republic appeals to the citizen not to be provoked. The issues connected with indebtedness to the credit institutions can be resolved legally through negotiations with the creditors or through court proceedings if no consensus is obtained or the facts of fraud are revealed on the part of the creditors.  

Closing of banks and non-financial credit institutions will not resolve the issues with separate troubled borrowers, moreover, it will result in breakdown of economic and financial systems. Financial institutions direct funds of their depositors and investors for which they bear responsibility for the purposes of providing loans to the population.   

Loans shall be repaid. The borrowers shall be aware of assumed obligations and repay a debt under loans. Otherwise, credit institutions shall be entitled to take measures stipulated by the contractual obligations. In case of any issues occurrence regarding loan repayment, the borrower can resolve thereof through negotiations directly with the credit institutions, which provided a loan. There is no need to take one more loan in order to repay the existing one. The conflict with creditors can be effectively resolved only within the legal framework.    

The current situation in Kyrgyzstan is very negative precedent for investors putting up their funds in the economy of the Kyrgyz Republic. Although the share of troubled loans is insignificant in the total volume of loans provided to the population, currently, protests can become the obstacle for further development of the crediting sector and therefore development of business and economy in the country as a whole. (As of September 1 the volume of overdue loans in the banking sector constituted 5%, in the micro crediting sector 2-3%). Meanwhile, the demand for access to the micro crediting services is increasing day by day; the significant part of the population is likely to be deprived of the possibility to receive necessary loan proceeds for development of business due to insignificant number of people, who initiate protests.    

The issues of loans repayment can be effectively resolved only within the legal framework, in the course of constructive negotiations with the borrowers or in court.   

REFERENCE   

Currently, 23 commercial banks and 281 branches of the commercial banks are operating in the territory of the Kyrgyz Republic.    

Commercial banks, their branches and savings banks opened in the Issyk-Kul region function nominally.   

Almost all commercial banks are represented in the Issyk-Kul region, except for Demir Kyrgyz International Bank CJSC, Kazkommertsbank Kyrgyzstan OJSC and ACB Tolubay OJSC. Commercial banks opened 38 branches and 38 savings bank, the total volume of attracted deposits constitutes KGS 1.29 billion, the quantity of depositors makes 52 118 persons, credit portfolio amounts to KGS 2.85 billion, the quantity of borrowers is 16 438 persons.      

In case borrowers apply to the National Bank, all problem situations are considered with the commercial banks and non-bank credit institutions thereby rendering assistance in resolving issues between creditors and borrowers within the legal framework. 401 customers of the commercial banks and non-financial credit institutions applied to the National Bank within 9 months of 2013. More than 50% of applications were resolved positively, in other words troubled loans were restructured. Separate borrowers could not obtain consensus, their applications are still considered.  

Licenses/certificates of the following non-financial credit institutions were cancelled: 

 

Certificate of accounting registration of the Osh branch of MCA “Umutum” № 34 as of May 26, 2003 for micro crediting of individuals and legal entities, self-liquidation according to the decision of the founder dated October 09, 2013, has been cancelled since October 12, 2013. Legal address: Kara-Kochkor village, Kara-Kuljinskiy district, Osh region.  

 

Interbank payments 

 

 

Interbank Payment Systems (IPS) indicators 

 

Total IPS 

including 

Clearing system 

Gross system 

Volume, 

KGS 

Q-ty,  

pcs  

Volume, 

KGS 

Q-ty,  

pcs  

Volume, 

KGS 

Q-ty,  

pcs  

Indicators for the period from October 07 to October 12, 2013 (Reporting period) 

Absolute Value 

17 172 320 241.57 

73 132 

2 271 913 787.95 

69 223 

14 900 406 453.62 

3 909 

Share in IPS payments (%)   

100.0 

100.0 

13.2 

94.7 

86.8 

5.3 

including 

(%) :  

  

  

  

  

  

  

Net positions of the Common Interbank Processing Center 

0.2 

1.4 

1.3 

1.5 

0.0 

0.0 

Outgoing to the Central Treasury    

14.6 

10.6 

26.2 

11.2 

12.8 

0.9 

Incoming to the Central Treasury  

11.2 

32.5 

17.0 

34.0 

10.3 

6.3 

Outgoing to the Social Fund  

0.1 

2.0 

1.0 

2.1 

0.0 

0.0 

Incoming to the Social Fund  

1.8 

22.0 

14.0 

23.2 

0.0 

0.0 

Average weekly indicators for the last month 

Absolute Value 

17 268 915 124.09 

54 360 

1 737 135 715.73 

50 776 

15 531 779 408.36 

3 584 

Deviation of indicators for the reporting period from average weekly indicators for the last month 

Absolute Value 

-96 594 882.52 

18 772 

534 778 072.22 

18 447 

-631 372 954.74 

325 

-0.6 

34.5 

30.8 

36.3 

-4.1 

9.1 

 

Elcart System indicators 

As of   

04.10.2013 

12.10.2013 

The total number of issued cards   

(excluding reissued)   

222 575 

224 549 

Number of POS-terminals:  

- in banks   

- in sale outlets   

1170 

653 

517 

1170 

653 

517 

Number of ATMs  

303 

305