On 19 August 2016, the Board of the National Bank of Ukraine issued Resolution No. 374 amending the Regulation on the Application by the National Bank of Ukraine of Enforcement Measures approved by NBU Board Resolution No. 346, dated 17 August 2012.

The resolution, inter alia, has streamlined the rules governing the application of selected enforcement measures.

In particular, the NBU has revised the methodology for the calculation of selected penalties, including penalties for:

• failure to submit/failure to submit in a timely manner/misreporting of statistics;
• non-compliance with reserve requirements;

failure to submit credible information/failure to submit information on the ownership structure in a timely manner.

The resolution has expanded the criteria for classifying banks as problematic. In particular, the NBU shall declare banks problematic for the following reasons:

• banks’ non-compliancewith reserve requirements for more than three successive reserve maintenance periods (except for the amount banks are required to have at the beginning of each business day in their correspondent account at the NBU);
• the establishment of facts that a bank has entered into an agreement (agreements) with bank’s related parties on terms and conditions  other than current market conditions which resulted in the non-compliance of the bank with at least one prudential ratio or led the bank to report a net loss.

Additionally, with a view to enhancing the efficiency of a special monitoring regime of the activities of the bank, provisions regulating the activities of the curator appointed by the NBU have been  streamlined.

The resolution shall enter into force on the day following its official publication.