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27.12.2012

Regulation on branches, representatives offices and secondary offices of banks, approved by the DCA of the NBM no.84 of April 28, 2011

Note: The translation is unofficial, for information purpose only

Official Monitor of the Republic of Moldova no.110-112 of July, 08, 2011, art.874

Registered
at Ministry of Justice
of the Republic of Moldova
No.832 of June 27, 2011

COUNCIL OF ADMINISTRATION
THE NATIONAL BANK OF MOLDOVA 

 

DECISION no.84
of April 28, 2011

on the approval of the Regulation on branches, representatives offices
and secondary offices of banks

Pursuant to letter d) Article 5, Articles 11 and 44 of the Law on the National Bank of Moldova no.548-XIII as of July 21, 1995 (Official Monitor of Republic of Moldova, 1995, no.56-57, Article 624), with further amendments and completions, Articles 13 and 131 of the Law on Financial Institutions no.550-XIII as of July 21, 1995 (republished in the Official Monitor of Republic of Moldova, 2010, no.110-113, Article 334) with further amendments and completions, article IV of the Law on amendments and completions of certain legal acts no.241 as of September 24, 2010 (Official Monitor of Republic of Moldova, 2010, no.247-251, Article 756), the Council of Administration of the National Bank of Moldova

DECIDES:

1. To approve the Regulation on branches, representatives offices and secondary offices of banks according to the Attachment no.1.

2. The applications and documents on opening and closing of branches, representatives offices and secondary offices submitted to the National Bank of Moldova and unresolved until the date of entering into effect of this decision shall be examined and resolved in accordance with the Regulation mentioned in item 1.

3. Until September 17, 2011 the provisions of item 11 of Regulation mentioned in item 1 shall not be applicable to banks that open branches for the purpose of bringing the activity of their separate subdivisions in accordance with the provisions of Article IV of the Law on amendments and completions of certain legal acts no.241 as of September 24, 2010.

Chairman
of the Council of Administration

Dorin DRĂGUŢANU

Attachment no.1
to the Decision of the Council of Administration
of the National Bank of Moldova
no.84 of April 28, 2011

REGULATION
on branches, representatives offices and secondary offices of banks

Amended by:

DCA of the NBM no.162 of 21.08.2014, Official Monitor of the Republic of Moldova no. 275-281 of September 19, 2014
DCA of the NBM no.301 of 20.12.2012, Official Monitor of the Republic of Moldova no. 270-272a of December27, 2012

 

Chapter I
GENERAL PROVISIONS

1. The Regulation on branches, representatives offices and secondary offices of banks (hereinafter – Regulation) establishes conditions for opening branches, representatives offices and secondary offices of banks from the Republic of Moldova (hereinafter – banks), the procedure for preliminary approval for opening branches and representatives offices, for notification for opening secondary offices, the permitted activities assigned, as well as the procedure for closing the respective subdivisions.

2. For the purpose of this Regulation, the following notions shall be used:
a) branch – separate subdivision, which is legally dependent part of the bank, carrying out all or some financial activities;
b) representative office – separate subdivision located outside the headquarters of a bank, which is legally dependent part of the bank, representing and defending the interests of the bank;
c) secondary office – structural internal subdivision of the bank’s branch in the form of agency or foreign exchange bureau, located outside the headquarters of the bank’s branch, which does not have a separate balance sheet and which carries out activities determined by the bank in accordance with this Regulation and legislation in force;
d) organizational-technical activities – technical activities/operations that ensure and facilitate the financial activities of the branch or bank, which conduct shall be realized independently without assuming any obligations on behalf of the bank or branch.

3. The bank can open branches, representatives offices only with the preliminary approval of the National Bank of Moldova (hereinafter – the National Bank).

4. The bank can open secondary offices after notifying the National Bank.

5. The organizational and operation procedure of the branches and representatives offices shall be established in the regulation of the branch, representative office, and of the secondary office – in the regulation of the branch for which a secondary office is opened, in the regulation of the respective secondary office or in the standard regulation of the secondary office, which regulates the activity of all secondary offices approved by the bank’s Board.

6. The name of the branch, representative office shall include an indication of the fact that it is a branch and respectively, a representative office of the bank which opened it.

7. The name of the secondary office shall contain an indication of its type (agency, foreign exchange bureau) and affiliation to a specific branch within which it has been opened.

8. The bank shall submit annually to the National Bank, on paper, the latest on January 15 following the reporting year, the information on branches, representatives offices and secondary offices, according to the Attachment to this Regulation.

9. Complying with the provisions of this Regulation does not exonerate the banks from complying with the provisions of the Law on foreign exchange regulation no.62-XVI as of March 21, 2008 (Official Monitor of the Republic of Moldova, 2008, no.127-130, Art.496) and of the Regulation on foreign exchange entities, approved by the Decision of the Council of Administration of the National Bank no.53 from March 5, 2009 (Official Monitor of the Republic of Moldova, 2009, no.62-64, Art.269) regarding the National Bank notice on opening foreign exchange bureaus of banks, submitting their working schedule, modifying the respective data, as well as the notice on final closing of the activities of foreign exchange bureaus of banks.

 

Chapter II
CONDITIONS FOR OPENING OF BRANCHES, REPRESENTATIVES OFFICES AND SECONDARY OFFICES

10. The branch, representative office and secondary office shall be opened upon the decision of the management body of a bank, which has this right in accordance with the bank’s statute. The bank’s statute shall contain information on branches and representatives offices of the bank.

11. In order to open a branch, the bank shall comply with the following requirements as on the date of submitting the application:
a) the bank shall have Tier One capital and risk weighted capital adequacy ratio in accordance with the requirements established in the Regulation on the risk weighted capital adequacy ratio, approved by the Decision of the Council of Administration of the National Bank of Moldova no.269 from October 26, 2001 (Official Monitor of the Republic of Moldova, 2001, no.130, Art.310);
b) the bank shall operate for at least one year after receiving the license for carrying out the financial activities and at least once to be subject to a complex on-site control by the National Bank;
c) the bank shall have been complied during the last 6 months with the prudential indicators limits according to the normative acts of the National Bank relating to Tier I capital, risk weighed capital, current liquidity (II);   
d) the bank shall not have any remedial measures applied by the National Bank stipulated in the Article 379 paragraph (1), letters c), d), Article 38 paragraph (2) item 3), letter b) and item 4) of the Law on Financial Institutions no.550-XIII of July 21, 1995 during the last twelve months before the date of submitting the application.
(Item 11 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)
(Item 11 amended by the Decision of the CA of the NBM no.301 of 20.12.2012)

12. For opening a representative office, the bank shall comply with the requirements mentioned in letters a), c) and d) item 11 on the date of submitting the application.

 

Chapter III
DOCUMENTS NECESSARY FOR THE PRELIMINARY APPROVAL OF OPENING OF BRANCHES AND REPRESENTATIVES OFFICES AND OF THE NOTIFICATION ON OPENING OF SECONDARY OFFICES

13. For obtaining the preliminary approval for opening a branch, representative office, the bank shall submit an application to the National Bank.

14. The application for obtaining the preliminary approval for opening a branch, representative office shall be written in the official language and signed by the chairman of the bank’s Board. Upon the application, the following documents in the official language shall be attached:
a) an extract from the minutes of the bank’s management body meeting within which the decision on opening a branch, representative office and on approving the regulation of the branch, representative office was taken;
b) copy of the regulation of the branch /representative office authorized by the bank, approved by the bank’s board, which shall include at least the name, headquarters, list of permitted activities of the branch, representative office, list of secondary offices, including their name, which shall indicate the type and the branch within which the secondary office is opened; headquarters of the secondary office;
c) the information on the headquarters of branch, representative office (address, telephone or fax numbers, email);
d) the copies authorized by the bank of the documents confirming the ownership or lease right on the facility where a branch, representative office is going to be located or an extract from the register of real estate confirming the registration of such rights;
e) the information on name/surname of the person proposed to be the manager of the branch, representative office;
f) in case of opening a branch – the set of documents necessary for confirming a person as the manager of the branch drawn up in accordance with the provisions of the Regulation on requirements for bank administrators, approved by the Decision of the Council of Administration of the National Bank of Moldova no.134 of July 01, 2010 (Official Monitor of the Republic of Moldova, 2011, no.91-94, art.619);
g) economic arguments for opening the branch, representative office, containing but not limited to the following information and data: the purpose and opportunity of opening the branch, representative office; coordination of the estimated indicators of the activity of the branch, representative office with the provisions of the business-plan of the bank; planned activities and their size; profitability etc.
(Item 14 amended by the Decision of the CA of the NBM no.301 of 20.12.2012)
(Item 14 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)
(Item 15 abrogated by the Decision of the CA of the NBM no.162 of 21.08.2014)

16. Banks shall notify the National Bank about any amendments (completions) to the regulation of the branch (or a new version thereof), including information on opening of a secondary office, within 10 days of registration of such changes with the state registration body, by a notifying letter, attaching the documents referee to in item 18.
In case of opening of a secondary office, banks shall provide the National Bank with the followings: type of secondary office, name of secondary office, which shall include the type and the branch within which the secondary office is opened; headquarters of the secondary office; organization and functioning of the secondary office, including permitted activities, in case the secondary office is to activate under a branch’s regulation.
(Item 16 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)
(Item 17 abrogated by the Decision of the CA of the NBM no.162 of 21.08.2014)

18. The notifying letter referred to in item 16 shall be prepared in the state language and shall be signed by the head of the executive body. The notifying letter shall be accompanied by the following documents prepared in the state language:
1) bank authorized copy of the decision on registration of amendments (completions) to the branch regulation (or new version thereof);
2) bank authorized copy of the amendments (completions) of the branch regulation, representative office (or the approval of the new version) registered with the state registration body.
(Item 18 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

19. National Bank shall have the right to request additional documents and information, in the event that the documents and information submitted under item 14 are insufficient to take a decision on the preliminary approval for opening of the branch or representative office.
(Item 19 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

 

Chapter IV
DECISION ON ISSUING THE PRELIMINARY APPROVAL ON OPENING OF THE BRANCH OR REPRESENTATIVE OFFICE

(Title amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

20. Within 30 working days from the date of receipt of complete set of documents, according to the items 14 and 19, the National Bank shall issue or refuse to issue the preliminary approval for opening of the branch, representative office, notifying the bank in writing about its decision.
(Item 20 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

21. As a reason for rejecting the application for preliminary approval of the opening of the branch, representative office shall be:
a) non-compliance of bank’s activity with the conditions established in Chapter II;
b) non-compliance of the planed activities of the branch, representative office with its permitted activities, in accordance to the items 32, 33, and in the event that the regulation of a branch contains the activities of the secondary office – non-compliance of these with the permitted activities, in accordance with the items 34 and 36;
c) non-submission of documents and information stipulated in Chapter III and/or submission of incomplete, contradictory, incorrect or insufficient documents and information;
d) in the event that the results of the examination of the possibility of opening of the branch, representative office does not allow the National Bank to be fully convinced that the bank will comply with the requirements of the Law on Financial Institutions no.550-XIII as of July 21, 1995 or its financial situation will be satisfactory.
(Item 22 and 23 abrogated by the Decision of the CA of the NBM no.162 of 21.08.2014)

24. If the National Bank considers necessary to make an additional investigation for taking a decision on the preliminary approval for opening of a branch or representative office, the deadlines stipulated in item 20 may be extended with 30 working days, upon the subsequent notification of the bank.
(Item 24 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)
(Item 25 abrogated by the Decision of the CA of the NBM no.162 of 21.08.2014)

26. The preliminary approval of the National Bank for opening a branch, representative office is valid for a period of 6 months from the date of issuance. In the event that the branch, representative office was not opened during this period, the preliminary approval loses its validity, and the bank is obliged to obtain a new approval under the conditions of this Regulation.

27. The branch, representative office can start its activity after obtaining the preliminary approval of the National Bank on opening the branch, representative office, its state registration and obtaining an authorized copy of the license of the bank.

28. The registration of the branch or representative office at the state registration body shall be performed as stipulated by legislation, submitting the preliminary approval of the National Bank on opening of the branch or representative office, which based on the Law on State Registration of Legal Entities and Individual Entrepreneurs no.220-XVI as of October 19, 2007 (Official Monitor of the Republic of Moldova, 2007, no.184-187, Art.711) shall be considered a positive notice of the National Bank.
(Item 28 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

29. The secondary office of the bank may start its activity after the registration at the state registration body of the regulation of the branch/representative office or amendments (completions) to the regulation of the branch (or the new version thereof) relating to the opening of the respective secondary office.
(Item 29 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

30. Within 10 days after registering the branch, representative office, at the state registration body, the bank submits to the National Bank documents listed in Chapter VII1 of the Regulation on licensing banks, approved by the Decision of the Council of Administration of the National Bank of Moldova no.37 of August 15, 1996 (Official Monitor of the Republic of Moldova, 1996, no.59-60, Art.74). Opening of the branch, representative office shall be registered in the register of licensed banks by writing the name and its headquarters.
In case the name and/or headquarters of the branch or representative office is changed, the bank shall submit to the National Bank a request for an authorized copy of the license of the bank, attaching the following documents prepared in the state language: authorized copy of the bank’s decision to register the respective amendments, amendments (completions) to the regulation of the branch, representative office (or approval of the new version thereof) and the document confirming the payment of the fee for the authorized copy of the bank’s license as in accordance with the Law on financial institutions. Changes of the name and/or headquarters of the branch, representative office shall be recorded in the register of licensed bank by a corresponding entry.
(Item 30 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

31. In case of opening of the branch, representative office, without obtaining the preliminary approval, and in case of opening of the secondary office - without the notification of the National Bank under the conditions of this Regulation, the National Bank may apply sanctions stipulated in the Law on Financial Institutions no.550-XIII as of July 21, 1995.

 

Chapter V
ACTIVITIES CARRIED OUT BY THE BRANCH, REPRESENTATIVE OFFICE AND SECONDARY OFFICE

32. The branch of a bank may carry out all or some financial activities stipulated by the license issued to the bank and may act within the limits of powers given trough regulation of the branch.

33. A representative office of a bank shall not have the right to carry out the financial activities and other activities, except activities related to information, representation and defense of bank interests.

34. An agency may carry out the following organizational-technical activities:
1) accepting deposits (payable current and term etc.), with or without interest, on the basis of contracts concluded and/or managed by the bank, receiving and processing documents and data related to opening a deposit account;
2) selling deposit certificates;
3) providing receipts services on the basis of contracts concluded and/or managed by the bank;
4) foreign exchange operations in accordance with the provisions of the Law on Foreign Exchange Regulation no.62-XVI as of March 21, 2008;
5) travelers’ check operations;
6) providing services of safekeeping property;
7) providing services related to credit transfer: receiving, processing payment documents, receiving funds in the event that the clients do not have bank accounts, and transferring all data for execution to the branch or headquarters of the bank;
8) management operations for direct debiting: receiving, processing payment documents and transferring all data for execution by the branch or headquarters of the bank on the basis of contracts concluded and/or managed by the branch;
9) servicing operations of card holders through POS terminals, set up at the headquarters of the agency: cash release, cash account, receiving and processing documents and data related to opening the card accounts;
10) providing services related to funds transfers through international funds transfer systems on the basis of contracts concluded and/or managed by the bank with the international transfer system;
11) providing financial advisory services;
12) operation of receiving, processing and issuing documents and information necessary for granting and supervising credits, taking actions for the reimbursement (recovery) of credits and other receivables of the bank, as well as for performing other operations with clients.

35. The list of specific activities permitted to the agency shall be stipulated by the bank in the regulation of the branch, in the regulation of the secondary office or in the type regulation of the secondary office which regulates the activity of all secondary offices approved by the bank’s Board.

36. A foreign exchange bureau carries out its activity in accordance with the Law on Foreign Exchange Regulation no.62-XVI as of March 21, 2008.

37. In order to hold a manager position of a branch, the respective person shall have the confirmation of the National Bank, issued under the conditions of the Regulation on requirements to bank’s administrators. In case of dismissal or temporary absence (vacation, business trip, etc.) of the manager of a branch, this branch shall be temporarily (not more than 6 months) managed by another administrator of the bank, except when the its functions are exercised by a deputy director of branch confirmed by the National Bank, notifying subsequently the National Bank about this fact.
(Item 37 amended by the Decision of the CA of the NBM no.162 of 21.08.2014)

38. The manager of the representative office and the chief of the secondary office shall not have the right to assume obligations on his/her own or together with others, on behalf and on the bank’s account and does not need the confirmation of the National Bank for the administrator position. The manager of the branch, representative office and the chief of the secondary office shall exercise their duties on the basis and within the limits of the regulation of the branch or representative office, other regulations, policies and internal procedures of the bank and the mandate (attorney) issued.

 

Chapter VI
CLOSING OF THE BRANCH, REPRESENTATIVE OFFICE AND SECONDARY OFFICE

39. Closing of the branch, representative and a secondary office means that the respective branch, representative and secondary office shall cease to perform its activities (operations).

40. The branch, representative office and the secondary office of the bank shall be closed by the decision of the management body of the bank that has the right to make such decision in accordance with the bank statute.

41. In the event that the decision on closing of the branch was taken, the bank shall notify the National Bank within 10 working days. The bank shall attach the following documents and information to the respective notification:
1) the extract from the minutes or the decision of the authorized management body of the bank comprising at least the following:
a) the decision on closing of the branch;
b) the measures to be taken in order to close the branch, especially, the way of execution the bank’s obligation assumed by the branch, such as their payment, transfer to another branch, their payment (taking over) by another bank;
c) expected terms for starting and closing the process of closing the branch, including the execution of the obligation towards clients (creditors);
d) the management body (or administrator) responsible for the branch liquidation process;
2) information on assets and obligations (liabilities) managed by the branch on the date of taking the decision of closing it, drawn up in accordance with the format of the Report FIN1 from the Instruction on FINREP financial situations at individual level, applicable to banks, approved by the Decision of the Council of Administration of the National Bank of Moldova no.292 of December 15, 2011 (Official Monitor of the Republic of Moldova, 2011, no.227-232, Art.2104), with further amendments and completions.  
(Item 41 amended by the Decision of the CA of the NBM no.301 of 20.12.2012)

42. In the event that the decision on closing of the secondary office was taken, the bank shall notify the National Bank within 10 working days, attaching at the respective notification the extract from the minutes or decision of the authorized management body related to closing of the secondary office.

43. In case of taking the decision on closing of the branch or the agency, within 10 days, the bank is obliged to notify clients (creditors) serviced by this branch or agency and take measures for execution of the obligation of the respective branch. The notification shall contain information on the execution procedure and on assuming the responsibility for the execution of its obligations and must be performed in one of the following ways:
a) written notification of each client (creditor);
b) publishing an advert in a nationally circulated newspaper or a newspaper from the locality where the branch or the agency is located or by other mass media and posting the advert in a visible place at the headquarters of branch or the respective agency.

44. After finalizing the closing process of the branch, within 10 working days, the bank shall inform the National Bank and submit the information on the results of the execution process of obligations assumed by the respective branch. If the respective obligations were paid (taken over) by another bank, a written confirmation of the latter on payment (taken over) obligations shall be submitted.

45. In case of taking the decision on closing of the representative office, within 10 working days, the bank shall notify the National Bank. The bank shall attach to the respective notification, the extract from the minutes of the meeting of the authorized management body of the bank comprising the decision on closing of the representative office, the term for starting and finishing the process of closing the representative office, the management body (or administrator) responsible for the closing process.

46. The removal of the branch, representative office, from the State Registry shall be performed at the state registration body as stipulated by the legislation.

47. After the removal of the branch, representative office, from the State Registry, the bank shall submit to the National Bank, within 10 days, the copy of the document confirming the removal of the branch, representative office.

48. Closing of the branch, representative office, shall be recorded in the licensed banks Registry through a removal entry.