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Requirements for the management of financial institution in Ukraine

The law of Ukraine "On financial services and state regulation of financial services markets" provides that in order for any financial to function such institution has to be registered in the State register of financial institutions (hereinafter - the Register). In order for the institution to be included in the Register it has to comply with a number of regulatory requirements regarding its organizational structure, capitalization, particular provisions of articles of incorporation etc.

Special attantion should be paid to qualification and professional requirements set for managing positions at financial institutions that were approved by the Resolution of the National Commission for the State Regulation of Finanсial Services Markets no. 1590 dated 13.07.2004.

With consideration of subsequent amendments and modifications made in the said instruction, as of today, the requirements for a head of a financial establishment and for his/her chief accountant are as follows:

Head:

  • Higher education of specialist’s or master’s level;
  • Labor activity experience not less than 5 years, of which the team leadership experience not less than 2 year, including the period of at least 1 year at the market of financial services.  It should be individually noted that for the heads of a board of directors of credit unions there is a requirement of team leadership experience of not less than 1 year, and the said requirement does not apply to the heads of pawn offices at all;
  • Ideal business reputation;

Chief accountant:

  • Basic higher education or complete higher education with field of study of the corresponding activity;
  • Not less than 3 years of team leadership experience (with connection of activity with finance and accounting), or in other positions if they are connected with activity in the spheres of finance or accounting at the market of financial services.

Further, we suggest considering the requirements established the for two mentioned positions:

1) For the last 5 years, a candidate has not held a position of a head, a chief accountant or a financial director at financial establishments which were:

  • recognized as bankrupts;
  • liquidated compulsorily;
  • subject to methods of influence on part of an authority that performs regulatory activity of markets of financial services, and namely, the senior managers were suspended from management activity at financial establishments, and temporary administration was appointed thereafter;

2)  A candidate has no outstanding conviction, or conviction, according to the legally established procedure, was not removed on:

  •  intended crimes;
  • crimes in the sphere of economic or official activity;

A candidate should not be deprived of the right of taking certain positions and perform certain activity based on Article 55 of the Criminal Code, either;


3) A candidate has taken the required skill-improvement (the course is not than 72 hours) and has passed an examination and has confirmed the compliance of available knowledge with professional requirements set in the skill-improvement program  (for a head – according to the program for the heads; for a chief accountant – according to the program for the chief accountants)

Procedure of training and taking an examination is set by the Regulation of the National Committee of Financial Services dated 25.12.2003 No. 183, according to which:

  • Period of training of specialists should not exceed 6 months;
  • The training may be both individual and as a course;
  • Based on results of training, the examination is taken before the commission that is created by the educational establishment.

As of today, there are several establishments in Kyiv which have the right to conduct such training, among which the following establishments are: “Institute of Post-Graduate Education and Business”, “International Academy of Finance and Investments”, “University of Banking”.

The fact of person’s compliance with all above-mentioned conditions should be confirmed documentarily. According to the general rule, the set of documents which certifies the head’s and chief accountant’s compliance with job requirements should include: diploma of acquiring the higher education, a work-record book, references of the corresponding financial establishments and a certificate obtained based on results of examination taking. It should be noted that other documents, too, may be required in individual cases.

Since the requirements for a head of financial establishment and for a chief accountant are rather rigid, the process of checking the candidates is time-consuming and incompliance of the hired person with the established requirements may become a reason for rejection for entering of your financial establishment in the register, we advice you, in case of any least doubt, applying to our experience in this matter.

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