Rules and Regulations

If several items of collateral are provided as security for the repayment of a loan (financial instruments), then, in the event of the borrower’s proper performance of its obligations under the financing agreement and provided that the market value of the collateral items, as determined by an appraiser (taking into account the Bank’s discount coefficient in accordance with the Bank’s requirements) as of the date of the borrower’s/pledger’s written request for a reduction of collateral, exceeds the outstanding amount of the borrower’s obligations, the Bank may, within the time limits established by the legislation of the Republic of Uzbekistan, take measures to terminate (amend) the pledge agreement(s) in respect of one or more collateral items to the extent exceeding the amount of the debtor’s obligations.

The Bank releases pledged property from the collateral structure in an order based on its liquidity (it is recommended that less liquid assets be released first) and the level of income generation of the asset (less income-generating assets first). The expediency of releasing a particular item of collateral shall be determined by the authorized body of the Bank.
A part of property that constitutes an integral component of a production/property complex/enterprise and is necessary for the comprehensive use of such property, including property forming a single technological cycle, may not be released from collateral, including but not limited to:

• property of a grain receiving enterprise (real estate and equipment);
• petrol stations and oil depots (real estate and equipment);
• agricultural enterprises: elevators, agricultural machinery and adjacent land plots (as a rule, held under temporary land use rights);
• property complexes of a production or industrial nature, including plants/factories and other production facilities (real estate together with the relevant production equipment).

When considering a written request of the borrower/pledger, as provided for in Clause 24 of this Policy, for the reduction or substitution of collateral, the following requirements shall apply, unless otherwise determined by a decision of the authorized body of the Bank:

• absence of any overdue indebtedness as of the date the Bank considers the borrower’s/pledger’s request;
• absence of any unfulfilled or deferred obligations, including those subject to grace periods, and/or obligations specified as special conditions (for example, deferral of execution of title documents/elimination of legal remarks in respect of the remaining collateral or provision of additional security) that are to be fulfilled by the borrower or pledger in the future. Accordingly, the Bank must hold duly executed title, identification and other documents for the collateral item(s) remaining after the release of the collateral at the request of the borrower/pledger;
• the collateral structure initially предусмотренная under the project in accordance with the requirements of the lending program must not deteriorate following the fulfillment of the borrower’s/pledger’s request for the release of collateral accepted under the relevant lending program;
• compliance of the property remaining after the release of the collateral item with the requirements imposed by the Bank on collateral in accordance with the Rules and the Bank’s internal regulatory documents.