Decree of the State Bank of Czechoslovakia No. 95 / 1965 Coll.
Decree of the Czechoslovak State Bank on the lending of socialist organisations and interest
Valid
Effective from 01.01.1966
95
DECLARATION
Czechoslovak State Banks
of 31 July 1965
on lending to socialist organisations and interest
According to § 391 (2) of Act No. 109 / 1964 Coll.:
General provisions
(1) Under this decree, the Bank provides operating and investment loans to state economic organisations and operating loans *) to production and consumer cooperatives (hereinafter referred to as "organisations').
(2) The Bank may provide organisations with other types of loans than those specified in this Order. The Bank's headquarters will decide on the introduction of these loans.
(3) The organisation and branch directorates submit their credit requirements to the Bank during the preparation of the plans, and through the credit plan, the Bank complies with all social needs.
(1) The Bank enters into credit agreements with its branches and organisations on lending.
(2) The credit agreement may be amended or cancelled by agreement of the Contracting Parties. Changes in the credit agreement shall be made by an additional credit agreement. The Bank shall be entitled to terminate, in whole or in part, the credit agreement before the expiry of its term of validity, in cases agreed in the credit agreement according to the principles of credit and interest policy laid down by the Government; the bank is entitled to refuse credit on a case-by-case basis, instead of giving notice or amending the credit agreement.
(3) Paragraph 153 (2) and (3) of Act No 109 / 1964 Coll.
The Bank shall examine whether the loan was used in the manner agreed in the loan agreement.
Operating loan
Operating loans and operating loan contracts
(1) As operating loans, the bank provides the organisations with a loan for currency and, in exceptional cases, a loan for wages.
(2) If necessary, the bank shall grant a loan to supplement the technical development fund of the branch headquarters.
(1) With the Directorate-General for the Sector, the Bank (Directorate-General for the Sector) concludes a credit agreement on the scope (economic criteria), time and framework conditions for lending to organisations, subordinate to the Directorate-General for the Sector. It is based on the principles of credit and interest policy and on the economic criteria for granting credit agreed with the relevant central authority to secure the credit plan. The contract referred to in this paragraph shall not be concluded with a branch undertaking without associated undertakings and special purpose vehicles.
(2) The organisation shall conclude a credit agreement with the bank (branch) setting out in particular the maximum amount, time and conditions for granting the credit. This is based on a loan agreement concluded between the branch and the bank.
(3) Credit agreements are concluded for the year.
Support for business by credit
(1) In order to promote business by credit, a bank (a branch) may enter into a credit agreement with the organisation for a higher amount of credit than the credit agreement concluded with the branch. It may apply an increased interest rate as a credit condition. The basis for this is an analysis of the use of circulatory funds and of the production and use of gross income (profit).
(2) If the bank refuses to enter into a credit agreement with the organisation for a larger amount of the credit referred to in paragraph 1, the organisation shall cover the currency of the currency of the currency in excess of the agreed amount from gross income (profit), in particular from the reserve (provided that the minimum amount of the reserve is retained) or from the fund of workers.
The Bank (branch) may, over the course of the year, grant a loan to an organisation to support business activities for efficient needs and above the amount agreed in the credit agreement with the organisation. A change in the credit agreement with the organisation shall be required only if the change in the credit agreement between the bank and the relevant branch director is agreed, to the maximum extent possible.
In order to promote business, the bank may reduce the interest rate on the loan during the year (Section 23 (8)).
Procedure for the breach of the terms of the credit agreement and the use of credit to safeguard social interests
(1) For an organisation that infringes the terms of a credit agreement, the bank shall analyse its business. On the basis of that analysis, it shall either terminate or amend the credit agreement in whole or in part, reject the loans on a case-by-case basis, or agree with the organisation of consolidation measures which it shall maintain in force the credit agreement in the performance of.
(2) In particular, when changing the credit agreement, the bank may raise interest rates or tie further credit on the condition that the organisation partially covers gross income (profit) assets. The Bank is bound by the principles of credit and interest policy.
(3) The Bank shall give prior notice to the organisation of the application of the measures referred to in paragraphs 1 and 2.
(4) The Bank may use the authorisations referred to in paragraphs 1 and 2, even in other cases determined by the Government.
Credit methods
(1) The provision and use of operating credits shall be followed by one of the following methods:
(a) joint use of loans and own funds provided by organisations (lending and clearing in an overdraft account);
(b) the use of loans granted separately from the organisation's own funds (lending in credit accounts when using a turnover account).
(2) The branch office of the Bank will agree on a lending method with the branch office, unless the head office of the Bank agrees with the central competent authority on a sectoral lending method.
Credit and settlement in an overdraft account
(1) The lending and clearing in an overdraft account is used for organisations that fulfil their obligations towards the company, effectively use their own resources and credit, comply with the credit conditions and organise their record and breakdown activities by being able to demonstrate to the bank for what purposes they use credit.
(2) An overdraft account is opened in the bank to organisations that are lent under this Section. The overdraft account may open sub-accounts for establishments and agents for making payments or collection of revenue. The Bank (head office) shall agree with the relevant central authority in which the overdraft lending and settlement procedures open separate accounts for selected types of loans.
(3) Organisations for which an overdraft account is opened may be set up to concentrate the funds of special-purpose corporate funds on separate credit accounts.
(1) An organisation shall account for the overdraft account or pay cash and non-cash revenues and other operating income, except for direct special-purpose subsidies for individual funds, where separate accounts are opened to them pursuant to Section 11 (3).
(2) From an overdraft account, the organisation pays all its operating payments, except those paid directly from the accounts referred to in Article 11 (3).
Credit in credit accounts when using a turnover account
(1) Loans under this Section are used for organisations for which the conditions for lending and clearing in an overdraft account are not met (Section 11 (1)).
(2) A credit account shall be opened to organisations that are lent under this Section and are granted a loan for circulation. An orbital loan may be provided in several credit accounts.
The loan shall be granted at the request of an organisation which shall indicate the amount of the funds in circulation in the breakdown agreed in the credit agreement, the amount of the funds of an operational nature available to cover the funds and the amount of the funds which cannot be lent under the credit agreement. The credit needs are demonstrated by the organisation to the bank by the balance sheet data or by operational data on the development of circulatory funds.
The loan shall be repaid within the deadlines and to the extent agreed between the bank and the organisation in the credit agreement or at the granting of the loan. The loan shall be repaid from the funds in the organisation's turnover account.
Salary loan
(1) If an organisation cannot ensure payment of wages by using its reserve fund or subsidies from the reserve fund of a superior body, it may apply to the bank for a wage loan. The request shall specify the reasons for the lack of resources and the measures taken to eliminate them.
(2) If the need for a wage loan does not result from permanent serious deficiencies in the organisation's management, the bank may also grant the organisation a loan for the payment of unreduced wages. If the need for a wage loan results from permanent serious deficiencies in the organisation's management, the bank can only grant a loan for guaranteed wage volumes. At the same time, the organisation shall set a maximum period within which it will grant the loan.
(3) On expiry of the deadline, the bank shall grant the organisation a wage credit for the guaranteed amount of wages only to guarantee the authority of the superior organisation. When discussing the guarantee, that authority shall agree with the competent authority of the bank the conditions for lending on the guarantee, in particular from which sources and within which period the guaranteed loan will be repaid. At the same time, a solution to the financial situation of the organisation with the participation of the competent authorities will be agreed.
(4) Salary credit is granted in a separate credit account.
Lending of technical development
(1) The costs of dealing with the tasks of science and technology for the organisation's own use, if they exceed the provision for future expenditure approved by the Directorate-General for the Organisation for the relevant period, shall be covered, where necessary, by a loan for circulation.
(2) In the event of a time discrepancy between the creation of resources and the need for resources in the technical development fund of the branch, the Bank may grant a loan to the branch head to supplement the technical development fund of the branch head, provided that the branch head cannot use other resources. This loan is granted in a separate credit account.
Investment loan
Investment loan types and investment loan contracts
The Bank shall provide the following types of investment loans to organisations:
(a) investment credit for sectoral investment;
(b) investment credit for corporate (rationalisation) investments;
(c) short-term investment (bridge) credit for corporate investment.
(1) The loan agreement for the branch investment is concluded between the branch director and the bank (the competent branch of the branch branch) and between the organisation and the bank (the relevant branch of the bank). In the case of a branch undertaking without associated undertakings and special purpose vehicles, only the contract with the branch of the branch bank referred to in paragraph 4 shall be concluded.
(2) Credit agreements for sectoral investment are usually concluded for several years and are refined by annual contracts.
(3) The credit agreement between the branch director and the bank (the competent branch of the branch bank) shall specify in particular:
(a) the total volume of the loan for sectoral investment for newly launched buildings and machinery not included in the budget of the built buildings;
(b) the allocation of the total amount of credit to individual buildings (machines) and investors agreed in the selection procedure;
(c) the credit guarantees taken over.
(4) The loan agreement between the organisation and the bank (branch of the bank) shall specify in particular the volume of loans for sectoral investments, their distribution, the conditions for their delivery and the method and timing of their repayment. Furthermore, the credit agreement includes an obligation that the organisation will immediately repay the loan if the loan will be transferred from the operational management of the organisation.
(5) The loan agreement for corporate (rationalisation) investments concluded between the organisation and the bank (the relevant branch of the bank) provides, in particular, for loans for individual investments, the conditions for granting them, the manner and timing of their repayment.
Sector investment lending
(1) The sectoral investment loan is granted within the set volume limit of the sectoral investment under the selection procedure. *)
(2) A loan for sectoral investment is granted to direct investors.
(3) The loan for sectoral investment must be repaid no longer than the planned return on these investments.
(4) The overall credit framework, authorised for the share of the total budget cost of the sectoral investment, is divided in the same proportion according to the annual planned tasks (according to the construction organisation plan). The bank transfers the annual share of the loan to the branch investment according to the direct investor's disposition to its source investment account. Any failure to meet or exceed the annual plan of the branch investment concerned shall be offset by an adjustment of the loan share in the following year. The repayment of the loan shall begin within one month of the planned date of the investment in the sector.
Business investment lending
Loan for corporate (rationalisation) investments
(1) For company investments of an intensive and modernising nature (both machine and construction), the bank grants credit to organisations in the absence of resources for corporate investment.
(2) The credit referred to in paragraph 1 shall be granted for effective and effective actions which shall be put into service no later than 2 years after the first credit draw.
(3) The organisation shall request the bank to grant the loan and provide supporting documents demonstrating the effectiveness and effectiveness of the action and, for construction actions, the timetable for the construction and securing of the project.
(4) Payment documents for supplies and work on a credit investment are paid directly from the credit account for corporate (rationalisation) investment.
(5) The repayment period for a loan to a corporate (rationalisation) investment must not exceed 4 years. The repayment of this loan shall commence within 1 month of the planned date of the introduction of the corporate (rationalisation) investment into operation.
Short-term investment (bridge) loan for corporate investment
(1) A short-term investment (bridge) loan may be granted to an organisation in the absence of own resources for corporate investment due to a time discrepancy between the creation and the need for resources, in advance of supply and work, or in the absence of the creation of own resources at the planned level.
(2) When applying for such a loan, the organisation shall indicate the time schedule for the generation of resources and how the loan is repaid.
(3) The proceeds of the short-term investment (bridge) loan are transferred to the investment (source) account of corporate investment gradually depending on how the lack of funds arises in the payment of investment works and supplies made.
(4) The short-term investment (bridge) loan is repaid from sources for corporate investment, up to a maximum of 1 year after it is granted. in the event of failure to create the planned amount of own resources for corporate investment in the gross income share of the organisation (profit).
Interest
(1) The organisation pays interest on loans to the bank.
(2) The interest rate on operating loans is 6%.
(3) The interest rate on the investment loan for sectoral investment is 8%.
(4) The interest rate on a loan to a corporate (rationalisation) investment is 8%.
(5) The interest rate on short-term investment (bridge) credit for corporate investment is 6%.
(6) The interest rates referred to in the preceding paragraphs are generally applicable unless a different rate is set as the basis for the conclusion of credit agreements for a certain period of time for certain sectors or types of credit.
(7) In cases where an organisation has infringed the terms of a credit agreement, the bank may, in accordance with the principles of credit and interest policy, increase the rate on the change of the credit agreement to a maximum of 12%.
(8) The conditions and extent of the interest rate reduction are laid down in the principles of credit and interest policy.
(1) The interest rate on credits on organisations' accounts with the bank is 1,8%.
(2) Derogating rates for the remuneration of certain deposits of organisations with a bank may be set out in the principles of credit and interest policy.
Interest shall be booked late over a period of no more than one year, with an interest counting year of 360 days.
Provisions common, transitional and final
(1) When switching to credit under this Order, the organisations' own currency, excluding production and consumption cooperatives, will be transferred to the national financial reserves; to that end, the bank shall grant the organisation a loan corresponding to its amount to the revolving fund of the organisation.
(2) In the case of production and consumption cooperatives, the bank will grant the loan, taking into account the amount of the own funds of the cooperatives and their possible addition by the loan provided by the cooperative funds under the agreement with the relevant central association.
The exemptions and derogations from this decree are permitted by the Bank's headquarters.
(1) Where this decree refers to a branch office, the branch (general) of the trust of undertakings and the branch of the branch company shall be understood as the branch (general) of the trust of undertakings.
(2) The provisions of the Directorate-General shall apply mutatis mutandis to the national committee of the relevant level and to the relevant cooperative association; the branch of the bank is the regional branch of the bank in relation to the Regional National Committee and the Regional Cooperative Association and in relation to the Regional (Local) National Committee of the Bank branch.
This Decree does not apply to organisations for which a derogation from the Government Decree on the planned management of the national economy is permitted or for which the Government provides for a special method of planning, requiring a special adjustment to the provisions on credit and interest. *)
This Decree shall take effect on 1 January 1966.
Director-General:
Dr Pohl v. r.
*) Specific regulations apply to the provision of investment credits to production and consumer cooperatives.
*) Section 4 of the Order of the Ministry of Finance and State Bank of 4 September 1965 on the financing of the reproduction of basic funds.
*) § 92 of Decree No. 90 / 1965 Coll., on the planned management of the national economy.
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Regulation Information
| Citation | Decree of the State Bank of Czechoslovak No. 95 / 1965 Coll., on the lending of socialist organizations and on interest |
|---|---|
| Regulation Type | - |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 23.09.1965 |
|---|---|
| Effective from | 01.01.1966 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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