The National Bank of Kyrgyzstan has approved new requirements regarding the development and implementation of financial recovery plans for commercial banks. This decision aims to ensure the stability of the financial sector and protect the interests of depositors during crisis moments.
According to information from the regulator, the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the Regulation on Requirements for the Bank's Financial Recovery Plan" was adopted on December 26, 2025. This document introduces unified approaches to the content and process of preparing financial recovery plans, covering all commercial banks, including those operating based on Islamic principles.
In accordance with the new rules, banks are required to develop plans that must include measures to maintain capital and liquidity adequacy in the event of a deterioration in financial condition. At the same time, the plans must take into account the specifics and risks associated with the particular institution.
Content of the Financial Recovery Plan
The plan must include the following elements:
- Assessment of the minimum financial impact of the proposed measures, including their effect on capital and liquidity;
- Timelines for implementing recovery measures;
- Feasibility analysis of the proposed actions based on the bank's experience;
- Confirmation of the applicability of the measures within one of the crisis scenarios;
- Assessment of the impact of the measures on the business model without compromising the bank's viability.
Recovery Responsibilities
The plan must include both mandatory and additional measures, such as:
- Increase in shareholder capital with an analysis of shareholder capabilities;
- Reduction of lending volumes;
- Suspension or reduction of dividend payments;
- Measures to reduce debt burden;
- Optimization of expenses.
Banks may also consider additional options, including:
- Sale of certain assets, including government securities;
- Attracting alternative forms of capital;
- Reduction of the trading portfolio;
- Limiting operations in foreign exchange markets;
- Reducing investments in high-risk assets.
Each recovery option must be described in detail, specifying operational steps, timelines, and effectiveness assessments, as well as impacts on shareholders and the bank's financial stability.
Plans for Banking Groups
The regulation also applies to the creation of plans for banking groups, where the parent bank must ensure the consistency of actions among all organizations within the group. Systemically important banks must submit their plans to the National Bank by March 15 each year.
The National Bank noted that international experience gained after the financial crisis of 2008 confirmed the importance of such plans in reducing risks and strengthening trust in the banking system. The resolution will come into effect 15 working days after its official publication.
