1. Fixed percentage of L/C’s amount is collectable as advance payment from applicant. If there is no special directive in this context, than this prepayment is payable on Afghani or foreign currencies both.
2. Immovable property belongs to the president or vice president of corporation or of the third person equivalent to the L/C amount will be officially taking under control of BMA by district and related court until clearance of loan.

Article 4: On the request of applicant, BMA can convert one currency to another currency on international exchange rate, through its corresponding banks.
Article 5: Converting commission from one currency to another currency is (0.25%). If the convertible amount exceeds from (USD 20,000.00) then the commission will be charged fixed amount of (USD50.00) or its equivalent from applicant.
Article 6: Fixing the percentages of L/C’s advance payment according to the special and justified conditions of DA Afghanistan Bank is as follow:

1. Up to five million Afghanis on authority of President & Managing Director of Bank.
2. Up to ten million Afghanis on the Board of Directors authority.
3. More than ten million Afs after approval of the Supervision Department of Da Afghanistan Bank (Central Bank).

Article 7: If advance payments of L/C paid by beneficiary as check drawn on other bank, the commission will charges as below:

1. Up to USD 50,000.00 =(1%).
2. More than USD 50,000.00, commission charges will be Fixed USD 500.00.

If the L/C(s) opened after collecting of the check’s amount, through BMA foreign branches, then this charges will be exceptional. The expenses of corresponding Bank in relation to the collection of check/currency are on beneficiary.   
Article 8: If the L/C’s amount is paid by cash or by check through current account with domestic Banks, it is not subjected to the commission mentioned in Article 7.
Article 9: While the beneficiary is opening L/C, beneficiary has to perform the following obligations:

1. According to the third article of this regulation, (0.50%) commission plus stamp expenses is collected from the fund of the L/C. If the L/C is opened through the external branches of Bank, and the commission of that branch is more than one percent, beneficiary is excused for paying the above-mentioned commission.
If the commission is less than one percent, the difference which reaching commission to one percent is collectable.
In the first stage, effort should be done to open L/C(s) through corresponding banks.
2. In case of opening L/C(s) by fax or E-mail, Afs 500.00 plus fax or E-mail charges is collected.
3. Those L/C(s) communicated by own expense of beneficiary though Bank, commission is collectable according to the regulations of SWIFT.
4. In amendment or extending L/C(s), (increasement is exceptional) the amount of Afs 500.00 plus post charges are collectable, even though, one or several L/C(s) have been opened by fax, E-mail or letter.

Article 10: All post charges is payable by beneficiary.
Article 11: The advance payment for L/C(s) that, delivery condition of goods from original point up to custom house is lack of insurance, the prepayment for opening L/C is 30% more than the fix percentage.
Article 12: Bank collects (Afs 2500.00) or its equivalent on foreign currency for the revocation/cancellation of L/C. The real expense of revocation/
cancellation is collected on advice receiving from corresponding bank or external branches of the bank.
Article 13: Beneficiary is responsible for paying all expenses plus interest of correspondent bank charges, but except the expenses mentioned in article #12.
Article 14: Additional funds of beneficiary in their L/C’s account are not subjected to interest.
Article 15: The basis of interest are evaluated and fixed by Board of directors on recommendation of board of management. This interest is created from the execution of currency and expenses of imparted L/C in the world market and other factors. The starting date for calculating of interest, its beginning from the payment date made by corresponding bank and it will be continued until re-payment date by beneficiary in Bank’s account.
Article 16: Irrevocable L/C can be revocated /cancelled through corresponding bank, after approval of both sides (banks). In this case, the amount paid by beneficiary as prepayment at the opening time of L/C, is payable to the a/c of beneficiary after deducting the expenses and revocated commission.
Article 17: Increase of L/C amount, subjected to the terms and conditions existed in the opening time of L/C. If the increase amount is not more than (five %) of the L/C’s value, it can be done once after approval of bank’s Board of Management and be counted to the beneficiary’s debt account.
Article 18: If beneficiary applied for opening of L/C and payment have taken place for expenses and commission, but the beneficiary do not want activation of L/C, in this case the paid amount is payable to beneficiary, after deducting of Afs 2500.00 as commission and post charges.


B:-Clearance of Imported L/C:

Article 19: According to the directions of Board of Management, clearance of imported L/C(s) takes place in both Afghani or foreign currencies. If the clearance takes place in foreign currency, the beneficiary should present cash convertible currencies, draft or check in according to the currency policy of the banks.
Article 20: If beneficiary presented check’s drawn of foreign banks the commission will be 1% for US$ 50,000.00 and over US$ 50,000.00 the commission will be fixed US$ 500.00. If the value of the check sent for collection, not collected during one month, the 0.50% charges will be counting and collecting date wise but the good releasing after full collection of check.
Article 21: If check(s) of foreign bank’s presented for collection, and missed after delivery to the post office; the beneficiary shouldn’t pay the interest from the delivery of check till the date of advising the corresponding bank.
Article 22: If the currency transferred by fax/swift for clearing of L/C, the interest is ended from the date of fund credited in bank’s account with corresponding bank.
Article 23: If beneficiary presents check(s) from domestic bank for clearance of L/C, it will not be subjected to the commission mentioned in Article #20. If the check is not collected in one working week, the commission and other charges mentioned in Article # 21 is applicable.
Article 24: If check(s) presented for the purpose of opening or clearance of L/C, and returned back without payment by corresponding bank, the act will take place according to the Article #21.
Article 25: If the goods of L/C(s) arrived to any custom house in country, and beneficiary did not taken action about the clearance of his/her L/C(s) and or not transferred the goods to the bank’s warehouse during two months, the bank will fixed taxation and carrying good to bank’s warehouse on the basis of separate protocol and will take the goods under its guarantee. Otherwise according to the Article # 38 of banking law a necessary action will be taken in this regard.
Article 26: In case of arrival goods in part shipment, beneficiary can get the document according to the Article # 25 of this policy, in proportion to the repay of loan’s percentages.
Article 27: Bank is not responsible for breaking, missing, shortage, commodity difference, losses in transportation and delay.
Article 28: Opening of imported L/C(s) will be according to the terms and conditions indicated in the back side of applications.
Article 29: All imported L/C(s) will be opened by Banke Millie Afghan according to the Standards of International Chamber of Commerce (ICC) and (UCP500) policy.


2:- Export L/C(s):

Article 30: Corporations, Enterprises, Co-operatives, Companies, Individual merchants, which are holders of official license, can export goods under the exported L/C(s) frame through Banke Millie Afghan.
Article 31: Bank will inform to the exporter in writing, about the opening of L/C(s) through its corresponding Bank.
Article 32: Exporter should inform acceptance or non-acceptance of L/C by sending a letter to the bank as immediate.
Article 33: In case of acceptance of L/C, the exporter should prepare related documents according to the L/C conditions and submit them to Bank.
Article 34: The related department will send the received documents to corresponding bank for collecting the goods prices, after being reconciled to the L /C(s) terms & conditions.
Article 35: Beneficiary is subjected to pay (0.50%) commission and stamp taxes for the exported L/C(s), according to the Article #3 of this policy. In addition to that; Afs 500.00 is payable by beneficiary when he/she received bank’s information regarding receipt of L/C(s).
Article 36: Beneficiary can utilize from the proceeds, according to the bank’s currency policy.
Article 37: If the bank had applied loan with guarantee on exported L/C(s), the credit date of good’s price in bank’s a/c with corresponding bank would be the cutting date of the loan’s interest.
Article 38: The exporter should pay, domestic and foreign banks all postage and other charges/expenses in this regards.
Article 39: Bank can not advise any exported L/C(s), if not received through corresponding bank.

Chapter Second:
Collections:

A: - Import Collections:

Article 40: In addition to the stamp tax, according to the third article of this regulation, (1%) commission is to be collected from the value of imported collections. If the amount of collection shall not collected in (30) days after advising to beneficiary, the documents will be rejected back, because of non co-operations of importer.
Article 41: For submitting the documents of an imported collection (under free of payment condition), the sum of Afs. 1500.00 to be collected from beneficiary.
Article 42: All expenses related to imported collection are collectable from beneficiary.


B: - Export Collections:

Article 43: From the value of exported collection, in addition to the stamp tax, 0.50% commission will be collected, according to the article No. 3 of this regulation.
Article 44: Acceptance of exported collections on the conditions of (Free of payment) is not allowed.
Article 45: Beneficiary is liable to pay the whole expenses concerning the exported collections.
Article 46: The clearance date of exported collections is the credit date of collection’s value in to the bank’s a/c with corresponding bank. The amount of Afs 2000.00 is collected from transferring of imported and exported collections from one bank to another one.


SECOND PART
Granting Loans by Banke Millie Afghan


Chapter Third:

Bank will grant loans under the condition of this part.  To apply loans, the lender office should study carefully all these conditions before applying the loans. When borrower completed all condition of this part, then action will be taken for granting the loans.
All commercial, constructional, mortgage and industrial loans, after studying by related offices, are recommended to the loans committee, mentioning all reasons in this regard. In recommendation and approval of each loan, the basic element and standard is, repayment of loan through private trade or income. Selling the property will be considered as the last stage.

SPECIFICATION OF BORROWER:

Article 47: Borrower should be creditable person and holder of official license. Foreigner, holder of official license, whose activities are authorized by the country laws, can borrow loans.
Article 48: Borrower should register his/her complete name and trading address with the Bank. Companies and corporations have to present their certified documents. They should inform to the Bank, if changed their address or amended their article of corporation.
Article 49: Borrower should have a good treatment, and confirmable personality. Also he/she should be capable to repay the loan from his trading transaction, which, loan being used in, and having sufficient capital, with a good position in to the market, and can present irreplaceable guarantee. In addition to that, borrower, should hove cleared his previous loans and credit transactions, and having no unclear debt in other sources.
Article 50: For evaluation of his activities, the borrower should present to the bank at least his/her past year balance, business plan anticipation of financial plan, income and expenses statement and his income sources.
Article 51: Granting loan to corporations and individuals, who had no activities in the past, the decision will take by the board of management and after confirmation of the board of directors.
Article 52: The borrower should explain the aim of borrowing and express where it will be used.
Article 53: The loan’s amount should only be used for attaining the aim, explained by borrower which confirmed by the bank.
Article 54: Complete surname and trade back ground of the borrower should be confirmed by two sources. One of them should be a bank (if possible).
Article 55: Repayment resources of loan, should be introduced by borrower, and evaluated by the bank, and assured.
Article 56: Borrower should present all his/her activities and changes in these activities during the certain periods.
 Article 57: The loan lender office, should study physically the reports in certain periods, and to prepare a report for each period, then register and keep them in the office files.


Chapter Fourth:

Guarantying Loans for Allowable Exporting Items:
Loan will grant on authenticating of allowable exporting items according to this regulation with the term and conditions as here under:
Article 58: The loan applicant should present the existence certificate of licensed exported goods (whole or partly) in his/her stock or factory.
Article 59: Availability of goods in the applicant’s stock will be certified in capital (Kabul City) and provinces by a delegation appointed by president and Managing director of the bank.


Chapter Fifth:
Mortgage and Constructional Loans:


First: Constructional Loans:

Article 60: Constructional company can get loans, if completes inserted articles of this regulation.
Article 61: Applicant of constructional companies should do the following:

1. Annex the map of project being under constriction.
2. If the land of building distributed by municipality, the ownership documents of municipality should be annexed.
3. If the constructional project is constructed on private land, the applicant should present the legal deed concerning the land with permission of city building ministry.
4.  From the clearance of legal obligations and state customs of project, assurance is provided.
5.  Other financing sources of the project to be introduced.
6. Owner or owners of the project should be introduced with their complete name and addresses.
7. Detailed plan of project, the cost and anticipated statement of probable income of project should be annexed.

Article 62:

1. If the applicant of loan is a constructing company, then the said company should presents a copy of contract.
2.  The company should present the list of machinery and equipment.
3. The constructional company should have at least one year back ground of working.
4. The documents and information given by contractor should be confirmed by the credit committee of the BMA.

Second: Mortgage Loans:

Article 63: The loans are granting to the mortgage and construction applicant, included in the city master plan, under the following conditions:

1. Owning a legal deed of land.
2. The property under instruction, till clearance of loan, can be legally under mortgage of BMA.
3. If applicant is a state official, he/she should provide his/her being there, by certificate from his/her employer.      
4. If the loan can’t be paid in fixed time mentioned in protocol, the property under mortgager will be taken directly under possession of bank, and the loan amount will be collected from the income of that property.

Third: industrial loans:

Article 64: If the industries owners can give guarantee of their irreplaceable properties, they can get advantages from the industrial loans.
Chapter Sixth:
Clarence of Loans:
Article 65: Executed loans are cleared according to the agreement concluded in the beginning of loan granting.
Article 66: The interests of loans are payable monthly.
Article 67: The loans to be cleared at the end of fixed period, if passed 10 working days after ending the fixed period, and loan couldn’t cleared by beneficiary, then one percent of the loans value is collectable  as penalty.
Article 6 8 : If the borrower is not able to clear the loan within 60 days after the fixed period ended, and taken no other decision in this respect, the property which is under guarantee of the bank, it will be sold and counted in bank’s loan a/c according to the article No. 38 of the banking law.
Article 69: If the sold proceeds of property which is under guarantee of the bank, not being sufficient for covering of loan, interest, and selling expenses, the borrower is identified as a debtor of bank, and imposed for paying the rest debt of bank.
Article 70: If the sold proceeds of property exceeded from the loan, interest and selling expenses, the surplus amount will credit in a/c of beneficiary (borrower).



Part Three
Miscellaneous orders:

Article 71: stamp Tax and bank commission are collectable according to the stamp tax and commission rule and regulations.
Article 72:  For fixing the percentages of loan, managing board of the bank will observe the article No. 6 of this regulation.
Article 73: If the bank facing some problems, which are not anticipated in this regulation, so, proper decision will be take by managing board of the bank.
Article 74: If beneficiary at the end of fixed period didn’t paid the loan and has no reasonable pretext he/she can not benefit from the additional loan of Banke Millie Afghan.
Article 75: In case of non clearance of loan, at the end of fixed period, even expended, one percent interest, in addition to the fixed percentage is calculated and collected.
Article 76: In case of non clearance of loan, and emphasized collection of loan, loan is collectable according to the law orders.
Article 77: The loans are applicable on the strength of immovable and private property of the president, vice president, or of the third person, after taking of official steps. Maximum 50% of the equivalent of final value of property on daily rate can be executed.
Article 78: The interest rate will applied annually is 10%, and it’s calculating from the executing date of loan.
Article 79: The commission and stamp tax for exported loan will be collected (0.20%) and (0.50%) respectively from the total amount of loan in Afghanis.
Article 80: Bank can guaranteeing internal and external loans of merchants and corporations against the legal security of their immovable properties at double cost of loan, or cash guarantee equivalent to guaranteed amount (STAND BY L/C) with 2% commission and stamp tax.
Article 81: Bank can’t accept any exemption for the losses totally or partly inflected to the guaranteed properties of borrower, in relation to the principal loan and interest.
Article 82:  Bank can make appropriate decision and action, according to the banking law, concerning the loan and bank’s debts, if facing some problems in their collection.
Article 83: Based on concluded contract with the bank, beneficiary cannot tax and carrying out his /her goods from the custom house without having the permission of bank.   
Article 84: After executing the loan, bank, should advise its related branches, about the guaranteeing of goods.
Article 85: Industrial, constructional, mortgage and building reappearing loans, the period and other specification are fixed, by the credit committee according to the peculiarity of project requirements of borrower, and if required a period of over three years for loans, the approval of Board of Directors should be provided.
The period of these kinds of loans can be fixed from one up to five years according to specification and other terms, conditions and risk possibility.
Article 86: This regulation is enforced and applicable from the approval date of Board of Directors of Banke Millie Afghan.
Article 87:  By enforcement of this regulation, the previous regulations are cancelled.

THE END

Memorandum:
This regulation has been approved; under resolution No. 28 dated 4.5.1383 corresponding to (July 25, 2004) of the Board of Directors, of Banke Millie Afghan Kabul.     

-----------------------------------------------------------------------
Translated By: Mr. Ghulam Nabi “Amanzai”
March 2005