The National Bank of Ukraine obliges banking institutions to give notifications to individuals and legal entities about identifying them as banks' related parties. Therefore, a bank should do this in writing and no later than the next business day after classification of an individual or a legal entity as a bank's related party and adding data on it to the list of such parties.

"This requirement will allow individuals and legal entities to fully understand the prospects and consequences of acquiring the status of a bank's related party. This is important for banking system development, since it will enable banks and their related parties to build transparent relationships that will be understandable for both parties and based on mutual respect and responsibility," said Mr Oleksii Rudyi, Head of Related Parties Monitoring Office.

In addition, the NBU specified the features to classify banks' related parties for improving the mechanism of control over banks' transactions with related parties. After revising, inter alia, the following entities shall not be deemed to be bank's related parties based on the criterion of being affiliated:

• the State of Ukraine (represented by a public authority and / or entities operating based on solely state-owned property
• a local community (represented by a local authority
• an international financial institution with which the government of Ukraine signed the agreement on cooperation and which has privileges and immunities pursuant to the laws of Ukraine.

Legal entities with qualifying holding of the state, local communities or financial institutions having privileges and immunities shall not be considered bank's related parties based on the criterion of being congenerous.

The respective amendments to the Regulation On Identifying a Bank’s Related Parties are introduced by NBU Board Resolution No. 91 dated 15 September 2017, which shall come into effect on the day following its official publication.