as amended /Journal of Law of 1992 no. 72 item 359/

Chapter 1

General Provisions

Art.l.l. This Law shall define the principles of activities as well as of establishment and organization of banks.
2. The provisions of this Law shall apply to activities of Narodowy Bank Polski in the scope not provided for in the Act on Narodowy Bank Polski.

Art.2.1. Banks shall be organizational entities having personality at independent and self-financing law, operating pursuant to Law and their statutes.
2. State-owned banks are not subject to entry in the Register of State-owned enterprises.

Art.3.1. The statutes of a bank shall define:
1/ its name, which should include the word "bank" and which shall be distinct from the names of other banks; provided, however, that the name of a cooperative bank should also contain the word "cooperative";
2/ the seat of the bank and the subject matter and scope of its business;
3/ the governing bodies and organization of the bank, procedure applied in submitting statements in respect of rights and duties;
4/ bank owned funds, rules concerning the raising and using of special funds, as well as principles of financial management.
2. The statutes shall also include those provisions which are required pursuant to this Law and other laws.

Art.4.The general scope of business of banks shall include the collection of money, the granting of credits and money loans, as well as conducting monetary transactions.

Art.5. /deleted/ l2

Art.6. The right of banks to possess foreign exchange and conduct foreign exchange transactions shall be determined in the banks' statutes.

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1/ Applies only to Announcement of the President of the NBP July 20, 1992 regarding the publishing of the amended version of the Banking Law Act /J.L. of 1992 no.72 item 359/.

2/ By art. 1.1. of the Act of February 14, 1992 amending the Banking Law and certain other Acts /J.L. no.20 item 78/ effective on April 9, 1992.

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Art.7. Banks shall ensure proper protection of property received for safe-keeping.

Art.8. Banks may:
1/ establish commercial and civil law companies, as well as cooperatives;
2/ along with other entities, pursue business activities, as well as provide consulting advisory services regarding financial matters;
3/ to the extent determined in their statutes, undertake economic business not provided for in this Law;
4/ 3 establish and liquidate branch offices and other entities abroad, as well as become a shareholder /stockholder/ in foreign banks and legal persons operating in Poland.

Art.9. Banks are required to maintain payment liquidity which shall mean conducting the operations of the bank in a manner that ensures that the bank meets all of its obligations upon their maturity.

Art.10. Unless this Law provides otherwise, natural and legal persons when opening a bank account, drawing bank credit or using other banking services are entitled to free selection of a bank which provides such services.

Art.10'.1. 4 The terms "bank" and "kasa" may be used in the name of a bank and to define the activities of the bank or to advertise the organizational entity as being a bank within the meaning of the provisions of this Law.
2. The provision of section 1 shall not apply to organizational entities using the terms "bank" or "kasa" in contexts which render it unambiguously clear that such entities are not performing banking operations.
3. The term "kasa" may be used in the name of and to define the activities of or to advertise an organizational entity performing the activities of the collection of savings and granting money loans to natural persons who are members of such an entity.
4. 5 The following terms as used in this Law shall have the following meanings:
1/ Domestic bank - a bank established pursuant to applicable Polish Law and having its seat in Poland;
2/ Foreign bank - a bank having its seat abroad.

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3/ In wording given in art. l.2. of the Act mentioned in note 2.

4/ Added by art.l.2. of the Act of December 28, 1989 amending the Banking Law and the Act of Narodowy Bank Polski /J.L. no. 74 item 439/, effective on January 1, 1990.

5/ Added by art. 1.3. of the Act mentioned in note 2.

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Chapter 2

Banking Operations

A. Common Provisions

Art.ll.l. Banking activities shall include the following specific activities:
1/ management of bank accounts;
2/ acceptance of savings and time deposits;
3/ conduct of money settlements;
4/ granting and taking of credits and money loans;
5/ performing cheque and bill-of-exchange operations;
6/ acceptance of and making of deposits in domestic and foreign banks; 7/ issuance and acceptance of bank warranties and guarantees;
8/ trade in foreign exchange and rendering financial services for international transactions;
9/ dealing in state loans;
10/ 6 issuance of securities, dealing in securities and operating deposit accounts of securities;
11/ performance of commissioned operations related to the issuance of securities;
12/ safe-keeping of items and securities as well as making safes available.
2. 7 Banks shall have the authority to perform the operations mentioned in (1) to the extent provided for in their statutes, subject to the provisions of items (3) and (5) herein.
3. Banks are entitled to perform banking activities that are within authority of other banks when commissioned by such other banks.
4. 8 Banks entitled to perform foreign exchange activities may purchase securities issued abroad, the scope of which will be determined by the President of Narodowy Bank Polski, acting in consultation with the Minister of Finance.
5. 9 The operations mentioned in item 1, above, may be performed also by organizational entities which are not banks when

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6/ In wording given in art.l.4a/ of the Act mentioned in note 2.

7/ In wording given in art.l.3a/ of the Act mentioned in note 4 and by art.l.4b/ of the Act mentioned in note 2.

8/ Added by art. l.4c/ of the Act mentioned in note 2.

9/ Added by art.l.3b/ of the Act mentioned in note 4 and according to the numbering given in art. l.4d/ of the Act mentioned in note 2.

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empowered pursuant to the Law.

Art.11'.1. 10 Subject to Art.11.5, the President of Narodowy Bank Polski, acting in consultation with the Minister of Finance, may permit a commercial law company to perform certain banking operations, excluding in particular the acceptance of savings and time deposits and the issuance of securities and bank guarantees.
2. The permit referred to in item 1, above, shall define in detail the conditions upon which authorized banking activities may be performed.
3. The President of Narodowy Bank Polski, acting in consultation with the Minister of Finance, shall determine by way of an Ordinance the procedure of issuing permits mentioned in item 1, and performing supervision over the banking operations allowed for in said permits.

Art.12.1. Within the scope of their business, banks may issue regulations determining:
1/ 1l terms of opening and operating bank accounts;
2/ 12 types of savings deposits and terms of operating savings deposit accounts;
3/ types of credits to be issued and terms of credits and loan agreements;
4/ terms under which safes are available;
5/ other services provided by banks.
2. The provisions of regulations mentioned in item 1, above, shall be binding on the parties unless the parties establish their rights and duties otherwise in an agreement.

B. Bank Accounts and Money Settlements

Art.13.1. Banks shall open and operate bank accounts for legal and natural persons.
2. The following accounts shall be opened and operated for the purpose of depositing money and transacting business operations:
1/ 13 current accounts;
2/ auxiliary accounts;
3/ time deposit accounts;

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10/ Added by art.l.5 of the Act mentioned in note 2.

1l/ Added by art. 1.6a/ of the Act mentioned in note 2.

12/ According to the numbering given in art.l.6b/ of the Act mentioned in note 2.

13/ In wording given in art.l.7a/ of the Act mentioned in note 2.

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4/ /deleted/ 14
3. 15 Upon execution of an agreement to operate a bank account mentioned in item 2.1/ above, a bank may reserve for itself the right to be notified upon the opening of an account with another bank.

Art.14.1. 16 A holder of a bank account shall possess the full right to dispose its monetary resources remaining in such an account. An agreement executed with a bank may contain restrictions as to the freedom of disposing such resources.
2. Monetary resources remaining in the account may bear interest at a rate and in accordance with provisions to be determined in an agreement executed with the bank.
3. The President of Narodowy Bank Polski may set limits on the rate of interest being paid on deposits in foreign currencies being accumulated in bank accounts.

Art.15. 17 /deleted/

Art.15.a/ 18 /deleted/

Art.16.1. The President of Narodowy Bank Polski:
1/ 19 shall determine the general terms of opening and operating bank accounts;
2/ shall determine the methods and procedures for performing money transactions through banks.
2. Banks shall:
l/ 20 be obliged to process money orders at dates provided for in the bank account agreement, or without undue delay when such dates have not been provided for in such an agreement;

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14/ By art.l.7a/ of the Act mentioned in note 2.

15/ In wording given in art.l.7b/ of the Act mentioned in note 2.

16/ Does not include amendments given in art.4.1. of the Act of September 29, 1989 on changes in state budget implementation in October 1989 and on amendments to the Budget Act for 1989 and some other acts /J.L. no. 54 item 320/ as a result of deletion of art.15a/ by art. 1.4. of the Act mentioned in note 4.

17/ By art. l.8 of the Act mentioned in note 2.

18/ By art.l.4 of the Act mentioned in note 4.

19/ In wording given in art. 1.9 of the Act mentioned in note 2.

20/ Added by art.l.5a/ of the Act mentioned in note 4.

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2/ 21 be obliged to accept cash payments and to count and sort legal tender derived for such payments and may charge a commission fee on cash payments made into bank accounts;
3/ apply the rules, as determined by the President of Narodowy Bank Polski, of counting, sorting, packaging and labelling packages of legal tender, as well as performing the operations related to the supply of banks with such legal tender.

C. Savings Deposits

Art.17. Banks shall accumulate money savings of natural persons in savings accounts, including those in foreign currencies / "savings deposits".

Art.18. Banks shall issue registered and bearer receipts for the placed savings deposits.

Art.19.1. The rules for and procedure applied to the redemption of registered receipts for the placed savings deposits shall be determined by the Minister of Justice acting in consultation with the President of Narodowy Bank Polski, by way of an Ordinance.
2. Bearer receipts for the placed savings deposits shall, in the event of loss, be redeemed according to rules applicable to lost documents, except for the case when the receipts issued contain a restrictive clause of non-redemption in the event of loss.

Art.20. The redemption of lost bearer or registered receipts for the placed savings deposits during a court or an administrative enforcement from a savings account shall be regulated by applicable provisions of the Code of Civil Procedure and provisions on administrative enforcement.

Art. 21. 22 Savings deposits of a natural person placed in a bank shall be exempt from court and administrative enforcement up to the amount equal to three times the average monthly salary of employees within the national economy, as published by the Central Office of Statistics, irrespective of the number of receipts issued for the deposits made.

Art. 22 . 1 . Upon the death of the depositor, the bank shall be obliged to reimburse from his savings deposits for which registered receipts have been issued:
1/ the costs of the depositor's funeral to the extent that such

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21/ According to the numbering given in art.1.5b/ of the Act mentioned in note 4.

22/ In wording given in art.1. 10. of the Act mentioned in note 2.

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funeral conforms with the customs of tradition prevailing within the depositor's community - to a person submitting bills confirming the amount of outlays incurred by such person;
2 / 23 an amount not exceeding in total the sum of the average salary of employees in the national economy, as published by the Central Office of Statistics, for the period of five calendar years preceding such a payment - when the depositor had indicated writing to the bank or to its branch office, with jurisdiction over his last place of residence, the persons to whom such a payment is to be made; the persons designated by the depositor may include his spouse, descendants, parents, grandparents and siblings.
2. The sums mentioned under section 1 above, shall not belong to the estate of the depositor.

Art.23. Unless the savings account agreement provides otherwise, such an agreement shall be terminated when no account transactions have been conducted for a period of five years, except for the regular entry and payment of interest, and the deposited amount does not exceed the required minimum provided for in such an agreement.

Art.24. A minor may possess a bank account and after becoming thirteen years of age may also draw money from such an account, unless the person's legal representative objects to such a withdrawal.

D. Credits and Money Loans

Art.25.1. Banks may issue credits in Polish Zloty and in foreiqn currency.
2. Banks may issue and draw foreign credits.

Art.26.1. Banks may issue credits to legal and natural persons.
2. Banks may also issue credits to economic entities not having legal personality at law.

Art.27.1. A credit agreement obliges the bank to put at the disposal of the debtor a defined amount of money during a term to be agreed therein, and the debtor undertakes to use the issued credit to the terms of such an agreement, to repay the amount of credit used together with accrued interest within the agreed repayment dates and to pay a commission fee upon the issuance of such a credit.
2. The agreement shall be executed in writing and shall determine in particular:
1/ the amount of credit;
2/ the repayment dates;
3/ interest on the credit;

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23/ In wording given in art.1.11. of the Act mentioned in note 2.

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4/ measures available to the bank in connection with the credit issued and securing its repayment;
5/ dates on which funds are made available to the debtor.

Art.28.1. The granting of credit by a bank, its amount and other terms mentioned in Art.27.2, shall be conditioned upon the creditworthiness of the debtor, which shall be understood to mean the debtor's ability to repay the credit together with interest on the agreed dates of repayment and upon the submission by the debtor of documents and information required to assess such creditworthiness.
2. The provision of item 1 above, shall not apply to the granting of credit to a newly established legal person if such a person submits security referred to in Art.30.
3. A bank may grant credit to a legal person not having creditworthiness on the condition that such a person shall submit an economic rehabilitation programme the implementation of which assures, in the bank's opinion, the resumption of creditworthiness within a specified period of time.

Art.29. A bank may accept from a debtor bills for discount and the amount obtained from the debtor shall be included in the total amount of credit issued by the bank.

Art.30.1. 24 To ensure the repayment of credits banks may require debtors to give security as provided for in the Civil Code and Bills of Exchange Law, as well as by customs adopted in cooperation with foreign banks.
2. 25 In case of an lien being established upon a motor vehicle subject to registration, such an lien shall be endorsed in the registration document of such a vehicle.
3. The Minister of Transport and Maritime Administration shall determine the procedure to be applied in connection with the endorsements mentioned in item 2 above.

Art.31.1. A bank may require a debtor to submit information and documents necessary to assess its economic and financial standing during the term of the credit utilization.
2. If scheduled repayment of the credit is threatened because of the debtor's poor financial standing, the bank may terminate the credit agreement in whole or in part, or may demand security for the credit pursuant to Art.30. Further availability of credit to the legal person conducting business may be made by the bank dependent upon the presentation by such a person, within a specified period of time, of a business rehabilitation programme assessed by the bank to be reliable.

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24/ According to the numbering given in art. 1.12a/ of the Act mentioned in note 2.

25/ Added by art. 1.12b/ of the Act mentioned in note 2.

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Art.32. Upon default by the debtor in respect to material provisions of the credit agreement, the bank may terminate a part of or all of the credit before the date of payment of the credit provided for in the agreement.

Art.33.1. A bank charges interest on the credit used according to a fixed or variable interest rate as provided for in the agreement.
2. The bank is entitled to a commission fee on granted credits, established in the credit agreement.

Art.34. The interest and commission fee mentioned in Art. 33 may be charged by the bank in the currency of the credit issued.

Art.35.1. 26 In order to prevent the excessive concentration of credit and other liabilities:
1/ the sum of credit and money loans as well as liabilities arising from bank warranties, guarantees, letters of credit and other liabilities of a bank incurred on order by a client in relations with one entity or a group of equity or organizationally affiliated entities cannot exceed 15% of bank's own funds,
2/ the liability of any single agreement may not exceed 10% of the total of a bank's own funds.
2. 27 The value of shares and contributions subscribed for in another legal person and the value of purchased stocks and bonds may not exceed in total 25% of the total of the bank's own funds.
3. 28 The limits mentioned in item 1 above, may be exceeded upon consent of the President of Narodowy Bank Polski, but shall, in any case, not become higher than 50% of the total of a bank's own funds.
4 . 29 A bank's own funds, as mentioned in items 1-3 above, shall be comprised of:
1/ in a State-owned bank: the statutory fund, reserve fund and reserve capital;
2/ in a bank formed as a joint stock company: the stock equity and all forms of reserve funds and capital;
3/ in cooperative banks: the shareholding fund, resource fund and

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26/ In wording given in art.1.13a/ of the Act mentioned in note 2; the ratio of credit concentration and other liabilities according to art.6.1. of the Act mentioned in note 2 and determined in art.35.1. applies to agreements concluded after April 9, 1992.

27/ In wording given in art.1.13b/ of the Act mentioned in note 2.

28/ In wording given in art.1.13c/ of the Act mentioned in note 2.

29/ Added by art.1.13d/ of the Act mentioned in note 2.

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reserve fund;
4/ other funds, as determined by the President of Narodowy Bank Polski.
5. The President of Narodowy Bank Polski:
1/ shall determine, by way of an Ordinance, the banks which, until their own funds are appropriately increased, may include in the calculation of their funds mentioned in item 1 and 2 above, money deposits accumulated in bank account and shall then determine the percentages of permitted concentration of credits and other assets;
2/ may permit banks to treat, as a portion of their own funds, the money resources accumulated on long-term deposit accounts, when the retention of such resources by the bank has been assured for a period exceeding 3 years;
3/ for the purposes referred to in item 1, above, may authorize the funds of banks that are related to each other, either by organization or through capital, to be considered as a single combined sum. The President of Narodowy Bank Polski has the authority to make this decision subject to the banks' compliance with requirements set by the President of Narodowy Bank Polski.
6. 30 A bank may execute with other banks an agreement on joint issue of credit /hereinafter called "bank consortium"/. A bank which shall initiate execution of such an agreement shall represent the bank consortium before the debtor and shall agree with such banks the terms of the credit agreement and principles for mutual settlements associated with the issue of such a credit.

Art.36. The provisions of Arts. 26, 30 and 35 shall apply respectively to bank loans issued in Polish Zloty or in foreign currency.

Art.37. Banks may draw refinancing credit in Narodowy Bank Pols ki pursuant to the Act on Narodowy Bank Polski.

E. Issue of Securities

Art.38.1. Banks shall have the right to issue bank securities pursuant to terms to be publicly announced by banks, subject to the restriction of item 2 below.
2. The President of Narodowy Bank Polski may establish cases in which consent of Narodowy Bank Polski shall be required for the issuance of bank securities.

Art.39.1. A bank may issue securities in the name of and on beh alf of entities authorized to issue securities and may perform other transactions commissioned by such entities.
2. A bank may provide guarantees for the fulfillment of its money obligations arising from securities issued by respective authorized entities.

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30/ In wording and according to the numbering given in art.1.13e/ of the Act mentioned in note 2.

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F. Other Operations

Art.40.1. Banks may issue guarantees and warranties to domestic and foreign persons upon their order and within the limits of such an order.
2. 31 The provisions of guarantees shall be null and void unless made in writing. The content of the guarantee shall in particular define the rights resulting therefrom, the name of the person authorized to exercise such rights, the amount of the guarantee and its term of validity. The President of Narodowy Bank Polski shall determine specific procedure and methods of issuing bank guarantees by way of an Ordinance.
3. Bank guarantees shall be subject to applicable provisions of the Civil Code, while the bank's obligation shall always constitute an obligation in money.
4. The commission fee for the provision of a guarantee or warranty may be charged by a bank in the currency of the obligation to which such a guarantee or warranty pertains.

Art.41. The liability resulting from a guarantee may be confirmed by another bank; in such cases, claims upon the guarantee may be submitted against the bank which had issued the guarantee or to the bank which had endorsed such, or to both such banks, until the creditor's claim is fully satisfied.

Art.42.1. 32 Banks shall perform foreign currency transactions pursuant to this Act, the Act on Narodowy Bank Polski, the Foreign Exchange Law and international agreements to which the Republic of Poland is a signatory.
2. Banks shall perform financial clearance of foreign transactions, embracing all forms accepted in international banking relations.

Art.43. The transfer of obligations resulting from bank guarantees may be effected only together with the transfer of debt secured by such a guarantee.

Art.44. A bank may accept an order to grant a credit to a third party. In this case, the person who orders the grant of credit becomes a warrantor of future debt, unless provided otherwise in the agreement.

Art.45. The provisions of the Civil Code on safe-keeping shall

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31/ In wording given in art.1.14. of the Act mentioned in note 2.

32/ In wording given in art.1.15. of the Act mentioned in note 2.

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apply to items and securities received by banks for safe-keeping.

Art.46. Banks shall exercise foreign currency control within the scope provided for by the Foreign Exchange Law and in their statutes.

Art.47. Banks may deposit their surplus money resources on accounts in Narodowy Bank Polski or in other banks pursuant to terms provided for in an agreement.

Chapter 3

Special Duties and Rights of Banks

Art.48.1. Banks shall maintain confidentiality of the transactions and balances of bank accounts.
2. 33 Information on completed transactions and balances of bank accounts shall be provided to owners of accounts or to auditors authorized by the owners of accounts.
3. 34 Banks are permitted to exchange information on credits issued, as well as on the transactions and balances of bank accounts to the extent this information is required in connection with the grant of credits, loans, guarantees and warranties. Such information, as it concerns economic entities, shall be transmitted periodically by the banks to the respective local branches of Narodowy Bank Polski. The President of Narodowy Bank Polski shall determine the scope of information to be provided about economic entities, the procedure for information transfer and for making such information available to banks.
4. 35 Information on the transactions and balances of bank accounts may not be provided except for the situations mentioned in items 2 and 3 above, unless such information is requested by the court or public prosecutor or General Inspector of Fiscal Control in reference to:
1/ a criminal, penal fiscal procedure or alimony suit, suit on maintenance pension or division of joint estate of a marriage, and

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33/ In wording given in art.38.5. of the Act of October 19, 1991 on examining and publishing financial reports and on chartered auditors and their autonomy /J.L. no. 111 item 480/ enacted on January 2, 1992, as well as by art.1.16a/ of the Act mentioned in note 2.

34/ In wording given in art.1.16b/ of the Act mentioned in note 2.

35/ In wording given in art.1.16c/ of the Act mentioned in note 2 and by art.l.la/ of the Act of May 22, 1992 amending the Banking Law and the Act on Narodowy Bank Polski /J.L. no. 49 item 221/ effective on July 10, 1992.

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in probate cases - pending against owner of the account being a natural person;
2/ penal procedure, or penal fiscal procedure relating to an offense committed within the scope of activities of a legal person or entity not possessing personality at law - being an owner of the account.
5. 36 Banks are obliged to provide information on the transactions and balances of bank accounts of entities supervised by the Supreme Board of Supervision also at a motion of a separate authorization issued by the President of the Supreme Board of Supervision in cases when the control maintained in such entities discovers incompleteness or inaccuracy of the financial documents concerning disbursement of public funds.
6. 37 The provisions of items 1, 2,4 and 5 shall apply respectively to information made available in respect of bank safes and items and securities received into safe-keeping.

Art.48'. 38 Banks are obliged to make public their audited balance sheets and profit and loss statements pursuant to the rules determined by the President of Narodowy Bank Polski.

Art.49. The State Treasury shall not be liable for obligations of banks except for the obligations:
1/ of savings deposits accumulated in State-owned banks, and also in other banks which benefitted from this right before enactment of this Law;
2/ for which it has accepted liability by way of guarantee and warranty.

Art.50.1. 39 Documents issued by a bank stating the issuance of credit, its amount, interest rates and repayment conditions shall be the basis for establishing a mortgage in the Land and Mortgage Register established for real property owned by the debtor; if the real property has no Land and Mortgage Register established, security may be effected by submitting such documents into a document file.
2. The provisions of item 1 shall apply respectively to each bank within the scope in which it is transacting the proceeds due

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36/ Added by art.l.lb/ of the Act of May 22, 1992 amending the Banking Law and the Act on Narodowy Bank Polski /J.L. 49 item 221/ effective on July 10, 1992.

37/ In wording and according to the numbering given in art.l.lc/ of the Act mentioned in note 36.

38/ Added by art.1.17. of the Act mentioned in note 2.

39/ In wording given in art.1.18. of the Act mentioned in note 2.

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to the State from sale of real property and premises.

Art.51. 40 The Minister of Justice shall, in consultation with the President of Narodowy Bank Polski, determine by way of an Ordinance reduced rates of court fees and exemptions from such fees in cases relating to securing debt on the title for issued credits, guarantees and warranties.

Art.52. Banks referred to in Art.49.1 may deduct debt which has not yet matured from sums due to them if a debtor has been put into liquidation and in all cases in which the bank has the right to claim such a debt before it becomes due.

Art.53.1. The books of banks referred to in Art.49.1. excerpts from those books signed and sealed by such banks and any and all affidavits issued in a similar manner, containing obligations, releases form obligations, waivers of rights or certifying receipt of sums due or stating the grant of credit, its amount and repayment terms, shall be binding official documents and will constitute the basis for making entries into Land and Mortgage Registers and public registers.
2. Excerpts from the books of banks referred to in Art.49.1. and other documents relating to the performance of bank operations stating the obligations to such banks and accompanied with an affidavit stating that the claims attached thereto have matured, shall have the power of a writ of execution without having to obtain court enforcement clauses for them. Enforcement of debts confirmed by such documents shall take place at the discretion of the bank, in accordance with the applicable procedure provided by the Code of Civil Procedure or in provisions on enforcement procedures in administrative bodies.
3. A debtor, by means of a lawsuit, may demand discontinuance of al l or any part of the enforcement procedure take n by the banks referred to in Art.49.1. pursuant to the Code of Civil Procedure or provisions on enforcement procedures in administrative bodies if enforced debt does not exist or exists in a smaller amount, or when the debtor makes a counter-claim eligible for set-off from the debt that is the subject of enforcement.
4. In order to take measures to secure the suit, the court

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40/ In wording given in art.1.19. of the Act mentioned in note 2; according to art.6.2. of the Act mentioned in note 2 the new wording of the regulation of art.51 shall be effective on January 1, 1992, at the same time all applications of banks to secure debt as a result of credits given or sale of real estate and apartments, submitted until December 31, 1991, are exempt from court fees.

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may suspend the enforcement procedure upon a motion from the plaintiff.

Art.53 . 41 1. 42 A bank may charge a commission fee on banking operations.
2. 43 A bank may charge fees for services other than those mentioned in item 1 above.

Chapter 4

Association of Banks

Art.54.1. 44 Banks may associate with another bank by way of an agreement signed by such banks for the purpose described in section 2 below.
2. An associate bank may be authorized by the agreement to:
1/ represent the joint interests of the associate banks particularly in relations with Narodowy Bank Polski;
2/ accumulate voluntary deposits of such banks, i.e. to secure their financial liquidity;
3/ grant refinancing credit;
4/ undertake business ventures for the joint benefit of the associate banks;
5/ undertake other activities.

Art.55.1. The Presidents of associate banks /Management Boards of banks/ shall establish a Council that shall be chaired by the President /of the Management Board/ of an associate bank.
2. The scope and procedure of the Council of associate banks as well as the implementation of its resolutions shall be defined in the agreement.

Art.56. /deleted/ 45

Chapter 5

Establishment, Organization and Operations of Banks

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41/ Added by art.1.6. of the Act mentioned in note 4.

42/ In wording given in art.1.20a/ of the Act mentioned in note 2.

43/ In wording given in art. 1.20b/ of the Act mentioned in note 2.

44/ In wording given in art.1.21 of the Act mentioned in note 2.

45/ By art.1.22. of the Act mentioned in note 2.

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Art.57.1. Banks may be established by legal and with the number of founders not being less than:
1/ three, if such a bank is established by legal persons;
2/ ten, if such a bank is established by natural persons. natural persons,
2. 46 The provisions of item 1 above, shall not apply to a bank being established by the State Treasury, by a domestic bank, by a foreign bank or by an international banking institution.

A. State-owned banks

Art.58.1. A State-owned bank is established and liquidated by way of resolution of the Council of Ministers based upon the advice of the President of Narodowy Bank Polski.
2. A resolution of the Council of Ministers on establishing a State-owned bank shall define the name, seat, scope of business and scope of activities of the bank as well as the appropriated from State Treasury assets which shall become the assets of such a bank.

Art.59. 47 1 . The governing bodies of a State bank shall be: the Bank Supervisory Board and the Management Board.
2. The Bank Supervisory Board shall be appointed for a term of three years from among persons having appropriate qualifications. The chairman of the Supervisory Board shall be appointed and recalled by the Prime Minister upon the request of the Minister of Finance, in consultation with the President of Narodowy Bank Polski. Members of the Council shall be appointed in equal number by the Minister of Finance, President of Narodowy Bank Polski and employees of the bank who are not members of the Management Board. Members of the Supervisory Board shall be recalled according to similar procedure used for their appointment.
3. Procedure used for appointing members of the Bank Supervisory Board by employees of the Bank shall be established by the Minister of Finance.
4. The President of the State-owned bank Management Board shall be appointed and recalled by the Supervisory Board. Vice-Presidents and the remaining members of the Management Board shall be appointed and recalled by the bank Supervisory Board on motion by the President of the Management Board.

Art.60. 1. The Supervisory Board shall supervise over operations

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46/ In wording given in art.l.23. of the Act mentioned in note 2.

47/ In wording given in art.l.24. of the Act mentioned in note 2; the appointment of supervisory boards of state banks according to art.6.3 of the Act mentioned in note 2 provided for in arts. 59-60 shall be accomplished not later than by October 9, 1992.

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of a State-owned bank, approve its balance sheet, accept the business report, provide recommendations to the Management Board and may suspend members of the Management Board from their duties.
2. The bank Management Board shall consider matters relating to the operations of the bank and shall pass resolutions on such matters, the performance of which shall be assured by the President of the bank Management Board.
3. The Supervisory Board may veto a resolution passed by the bank Management Board if it determines that it is inconsistent with applicable law or the statutes of the bank.
4. The President of a State-owned bank Management Board shall represent the bank before third parties, shall preside over the bank Management Board and shall organize the activities of the bank.
5. A detailed scope of activities of the Supervisory Board and the bank Management Board shall be defined in the statutes of such a State-owned bank.

Art.61. The Council of Ministers shall approve the statutes of State-owned banks.

B. Cooperative Banks

Art.62 .48 A cooperative bank is established pursuant to the procedure defined in the Cooperative Law with the permission of the President of Narodowy Bank Polski acting in consultation with the Minister of Finance.

Art.63. A cooperative bank shall have the status of a cooperative.

Art.64. The provisions of the Cooperative Law shall apply in matters not provided for herein.

Art.65. The statutes of a cooperative bank shall be approved as provided for in the Cooperative Law.

C. 49 /deleted/

Arts. 66-72 /deleted/

D. Banks in the Form of Joint Stock Companies

Art.73. Banks in the form of joint stock companies may be established with the permission of the President of Narodowy Bank

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48/ In wording given in art.l.7. of the Act mentioned in note 4.

49/ By art.l.25. of the Act mentioned in note 2.

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Polski, in consultation with the Minister of Finance, pursuant to procedure established in applicable provisions of the Commercial Code on joint stock companies.

Art.74. The applicable provisions of the Commercial Code on joint stock companies shall apply to the operation of banks formed as joint stock companies in matters not provided for herein.

Art.75.1. A Bank Council consisting of at least 5 persons elected by the General Assembly of Stockholders shall fulfill the role of a supervisory body in joint stock company banks.
2. 50. Unless the bank statutes provide otherwise, the President, Vice-Presidents and other members of the bank Management Board in a joint stock company bank shall be appointed and recalled by the Bank Council.
3. The President of the Management Board of a bank shall be appointed after obtaining an opinion of the President of Narodowy Bank Polski.
A motion requesting such an opinion shall be filled by the Bank Council.

Art.76. 51 /deleted/

Art.77. A bank in the form of a joint stock company may be established also by foreign persons or with the participation of foreign equity.

Art.78. 52 1. A bank in the form of a joint stock company is obliged to:
1/ notify Narodowy Bank Polski of all cases of a single stockholder possessing a holding of shares entitling such a stockholder to more than 10% of the votes during a General Assembly;
2/ obtain the consent of Narodowy Bank Polski for any transfer of stock if as a result of such a transfer a single stockholder shall be entitled to over 20%, 33%, 50%, 66% or 75% of the votes during a General Assembly. 2. A stockholder is obliged to inform a bank of its intention to purchase stock that, together with those already held, will constitute a holding entitled to the number of votes provided for in item 1 above. If the stockholder fails to comply with this obligation, the stockholder shall only be entitled to 10% of the votes at such a General Assembly or to such a number of votes which has been consented to earlier.

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50/ In wording given in art.l.26. of the Act mentioned in note 2.

51/ By art.l.27. of the Act mentioned in note 2.

52/ In wording given in art.l.28. of the Act mentioned in note 2.

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3. The acquisition or possession of stock by a subsidiary of a parent entity shall be deemed an acquisition or possession of stock by the parent entity. The parent /subsidiary/ entity shall be understood as an entity defined in the provisions of Art.2.9. and Art.4. of the Law mentioned in item 4 below.
4. The provisions of this article shall not violate the provisions of Title VII of the Law of March 22, 1991 on Public Trade in Securities and Trust Funds /J.L. no. 35 item 155 and no. 103 item 447/.

Art.79. Statutes of the bank established as a joint stock company shall be approved by the founders of the bank.

E. Procedure for Establishing of Banks

Art.80. 53 1 . A bank may be established when:
1/ it is ensured that it has:
a/ its own capital, in an amount which shall be in proportion to the types of banking operations to be performed and to the scope of operations envisaged by the bank, provided that any single founder can not own more than one-half of such an equity, subject to the provision of Art.57.2.
b/ premises which shall be adapted to provide appropriate safe keeping of valuable items or which shall be capable of being adapted to provide appropriate safe-keeping.
2/ bank founders and persons expected to take managerial posts at the bank shall provide a warranty of diligent fulfillment of activities securing the interests of bank's clients;
3/ at least two persons who shall take managerial posts at the bank have the education and professional experience necessary to manage a bank;
4/ a business plan submitted by the bank founders covering a period of at least three years which provides that such business shall be secured for the deposits being accumulated in the bank.
2. The equity of the bank may not be derived by way of loans, credit or encumbrance in any way whatsoever.
3. The bank may initiate its operation after Narodowy Bank Polski has concluded that the bank's premises are sufficient for due protection of the valuables stored in the bank.

Art.81. l.An application to the President of Narodowy Bank Polski for authorization to establish a bank shall contain:
1/ the name and principle office of the bank;
2/ types of banking activities which the bank shall have authority to perform and information on the scope of its activities to be performed; 3/ information regarding:
a/ the founders and persons expected to take managerial posts in

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53/ In wording given in art.l.29 of the Act mentioned in note 2.

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the bank;
b/ capital already raised or to be raised and paid into the bank.
2. The application shall include the following:
1/ draft statutes of the bank;
2/ a business plan for a period of at least three years.
3. The President of Narodowy Bank Polski shall in consultation with the Minister of Finance issue an Ordinance defining the detailed requirements for providing the bank with its own capital, particularly the minimum capital required for a bank with Polish capital and for a bank with foreign capital contributions and also the procedure required for submitting information and for the issuance of permits in cases provided for in Art.78.1.

Art.82.1. 54 The President of Narodowy Bank Polski shall require the founders to supplement their application when it does not comply with the requirements provided for in the preceding Article, and when such requirements have been fulfilled, shall consider the application and make its decision within not more than three months from the receipt of the application or its supplement.
2. 55 The President of Narodowy Bank Polski may extend the term mentioned in item 1 above to six months in justified cases.

Art.83. 56 1 . The decision of the President of Narodowy Bank Polski on granting consent to establish a bank, as mentioned in Art.81., shall include the bank's name, principal office, the scope of banking operations that the bank is authorized to perform and the name /names/ of the founders. The decision shall be binding on the founders and the bank.
2. The statutes of the bank shall conform to the scope of banking activities described in item 1 above, and any amendment shall require the consent of the President of Narodowy Bank Polski.
3. When granting consent for the establishment of a bank by foreign persons or with participation of foreign capital, the President of Narodowy Bank Polski shall determine the portion of profits which may be transferred by the foreign person abroad that will not require separate foreign exchange permit, provided that such a portion shall not be less than 15% of the profits distributed to the foreign person.
4. Provisions of Arts. 81 and 82 shall apply to an application amending the statutes of a bank.
5. Applicable provisions of the Law on Investment with Foreign Participation shall apply respectively to the rights of

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54/ In wording and according to the numbering given in art.l.30a/ of the Act mentioned in note 2.

55/ Added by art.l.30b/ of the Act mentioned in note 2.

56/ In wording given in art.l.31. of the Act mentioned in note 2.

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foreign persons employed in a bank to purchase foreign currency and its transfer abroad.
6. The authorization to establish a bank expires if such a bank has not commenced operation within one year from the date of the issuance of such an authorization.

Art.84.1. A decision rejecting either the establishment of a bank or an amendment of its statutes may be issued if the procedural requirements for establishing banks are violated or when the envisaged business of the bank infringes on applicable law or does not guarantee security of resources being accumulated in the bank.
2. A decision mentioned in item 1 above may be appealed to the Supreme Administrative Court.

Art.85. The establishment of banks with Polish capital or with participation of Polish capital abroad shall require an opinion of the President of Narodowy Bank Polski and the consent of the Ministry of Finance.

Art.86. 57 The opening of a branch or office of a foreign bank in Poland shall require the consent of the President of Narodowy Bank Polski, issued as a decision in consultation with the Minister of Finance. This decision may determine which portion of the foreign currency resource of the bank may be used for financial activities performed exclusively in the Republic of Poland.

F. 58 Transformation of Banks into Joint Stock Companies

Art.86 . 59 A State-owned bank may be transformed into a joint company bank.

Art.86 . 60 The Council of Ministers upon motion of the Minister of Finance after reviewing the opinion of the President of Narodowy Bank Polski, shall be way of an Ordinance:
1/ consent to the transformation of a State-owned bank into a joint stock company with participation of the State Treasury;
2/ determine the extent to which the assets of a State-owned bank will be contributed to the joint stock company in exchange for stock of the joint stock company, and to what extent such assets

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57/ In wording given in art.l.32. of the Act mentioned in note 2.

58/ Section F added by art.l.l0. of the Act mentioned in note 4.

59/ In wording given in art.l.33. of the Act mentioned in note 2.

60/ In wording given in art.l.34. of the Act mentioned in note 2.

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will be sold to the joint stock company established with participation of the State Treasury.

Art.86 . 61 1 . The transformation of a State-owned bank or a State-owned cooperative bank into a joint stock company shall not change the rights and duties set forth in Art.49. and from the agreements signed by the bank or from administrative decisions. The bank organized in the form of a joint stock company shall assume the obligations and debts of the State-owned bank or State-owned cooperative bank.
2. Employees of a transformed bank shall, by operation of law, become employees of the joint stock company bank.
3. A bank which has become a joint stock company hereunder shall be liable for obligations resulting from employment contracts incurred before the transformation procedure.

Art.86 . Upon the joint stock company bank obtaining personality at law, the State-owned bank or State-owned cooperative bank shall be considered liquidated and its governing bodies shall be dissolved.

Art.86 . 62 Unless otherwise regulated by this Law, upon transforming a State-owned bank or a State-owned cooperative bank into a joint stock company bank, the procedures for establishing of a joint stock company pursuant to applicable provisions of the Commercial Code, except for those of Arts. 313 and 347, shall also apply for establishing a joint stock company bank.

Art.86 . 63 1 . Until such time as shares of stock of the bank established by transforming the State-owned bank into a joint stock company in which the Supervisory Council is appointed pursuant to Art.59.2 shall be made available to third parties, the bank's employees shall elect their representatives to the Bank Council in a number not to exceed 1/3 of the total membership.
2. The Minister of Finance shall determine for each bank the number of employee representatives mentioned in item 1 above, and the procedure and rules applied for their election.
3. When shares of stock in the bank established in transformation of a State-owned bank which belong to the State Treasury shall be made available to third parties, the provisions

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61/ In wording given in art.l.35. of the Act mentioned in note 2.

62/ In wording given in art.l.36. of the Act mentioned in note 2.

63/ Added by art.l.37. of the Act mentioned in note 2; election of representatives of banks' employees to banks councils provided for in art.86 according to art.6.4. of the Act mentioned in note 2 was to be completed by July 9, 1992.

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of Chapter 3 and Art. 44 of the Law on Privatization of State-owned Enterprises of July 13, 1990 /J.L. no.51 item 298 and of 1991 no.60 item 253 and no. 111 item 480/ shall apply accordingly; provided, however, that the authority attributed therein to the Minister of Ownership Transformations shall be performed by the Minister of Finance.

Art.86 . A notary office shall charge a fixed notary fee to be established by the Minister of Justice by way of an Ordinance for the notarial procedures associated with transformation of a State-owned bank, a State-owned cooperative bank or in case of transformations described in Art.116

Chapter 6

/deleted 64/

Arts. 87-94 /deleted /

Chapter 7

Principles of Financial Management

Art. 95.1. Banks shall manage their finances independently pursuant to the principles of self-financing and shall cover from their revenue their costs of doing business, liabilities to the state budget and obligations arising from signed contracts, as well as costs of development and other expenditures.
2. The statutes of a bank shall define:
a/ funds to be created from write-offs from profits /from parts of the balance-sheet surplus/ which are not subject to distribution;
b/ rules for the covering of losses.

Art.96.1. 65 Banks shall manage their finances pursuant to a financial plan.
2. 66 Banks may calculate as costs the deduction made to the risk fund applied to the covering of losses associated with credits and loans issued.
3. The maximum amount of an annual deduction, mentioned in item 2 above, shall be equal to 1% of the average amount of unpaid credits and loans at the end of each quarter of the balance-sheet

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64/ By art.l.38 of the Act mentioned in note 2.

65/ According to the numbering given in art.l.39a/ of the Act mentioned in note 2.

66/ Added by art.l.39b/ of the Act mentioned in note 2; authorization of banks to calculate as costs the deduction made to the risk fund provided for in art.96.2-96.3 according to art.6.5 of the Act mentioned in note 2 may be implemented from January 1, 1992.

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year resulting from credits and loans issued, but shall in any case not be more than the amount of write-offs from the profits of the bank made to the risk fund in the same year.

Art.97. 67 Banks shall be taxed according to uniform rates and rules to be defined in separate provisions.

Art.97. 68 l . Banks are obliged to announce, in a generally available manner, at their place of business operation the interest rates applicable to deposits and resources in bank accounts, credits and loans and also the commission fees charged for banking operations and services.

2. 69 The bank may not apply interest rates on savings deposits, deposits and resources on fixed term accounts and on credits in respect to employees, stockholders /shareholders/ and members of the bank bodies which shall be more advantageous than those generally applied by such a bank at the time of signing agreements with such persons.
3. Arts. 100 and 101 shall apply respectively to the provisions of item 2 above.

Art.98.1. The balance sheet profit of a bank deducted by the payments resulting from tax obligations upon the profits shall constitute the net profit /balance sheet surplus/ of such a bank.
2. The principles of distributing net profit /balance sheet surplus/, creation of bank funds and their allocation shall be defined in the statutes of a bank.
3. The principles of remuneration and the formulation of the amount of bank resources to be applied to salaries in banks shall be provided for in separate provisions.

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67/ In wording given in art.l.40 of the Act mentioned in note 2.

68/ Added by art.l.41 of the Act mentioned in note 2; according to art.6.6 of the Act mentioned in note 2 provisions of arts. 97.1-3 and 97.2 in wording given in art.l.41 of the Act mentioned in note 2 are not to applicable to the agreements concluded before April 9, 1992; reads as follows: "2. The bank may not apply interest rates on savings deposits, other deposits and fixed term accounts and on credits in respect to employees, stockholders /shareholders/ and members of the bank bodies which shall be grossly more advantageous than those generally applied by such banks at the time of signing agreements with such persons."

69/ In wording given in art.l.2 of the Act mentioned in note 36.

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Chapter 8

/deleted/ 70

Art.99. /deleted/

Chapter 9

Supervision over Bank Operations

Art.100.1. Activities of banks, bank branches and representative offices of foreign banks shall be supervised by Narodowy Bank Polski within the scope and on principles provided for in this Law and in the Act on Narodowy Bank Polski.
2. The Minister of Finance may apply to the President of Narodowy Bank Polski to undertake actions or measures within the supervisory authority vested in it as described in item 1 above.
3. The purpose of supervision of Narodowy Bank Polski shall be to ensure:
1/ security of savings deposits and deposits accumulated in banks;
2/ conformity of bank operations with the Banking Law, and particularly with respect to the relations with legal and natural persons.
4. Actions undertaken by Narodowy Bank Polski within the context of supervision over bank activities shall include, in particular:
1/ analyzing the balance sheets of banks;
2/ investigating whether a bank meets its obligation to maintain payment liquidity;
3/ investigating whether the credits and loans issued are in conformity with the provisions of Art. 35 items 1 and 2;
4/ examining the security on credits and loans and whether the repayment of credits and loans are timely performed;
5/71 examining the interest rate charged on credits and loans and on savings and other deposits particularly considering of the cases provided for in Art.97' item 1;
6/ examining the financial standing of a bank.
5. 72 To accomplish the purposes of supervision determined in item 3 above, the President of Narodowy Bank Polski shall determine the following matters with binding force for the banks:
1/ liquidity standards, standards for the protection of bank assets with the bank's own funds and standards for acceptable risk in bank operations;
2/ procedures for executing agreements to establish bank accounts, the acceptance of deposits and the performance of other services, as well as those concerning notification of the appropriate State

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70/ By art.l.42 of the Act mentioned in note 2.

71/ In wording given in art.l.43a/ of the Act mentioned in note 2.

72/ Added by art.l.43b/ of the Act mentioned in note 2.

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authorities in cases which involve the disclosure of circumstances where resources deposited with the bank or other valuables have been derived by way of a criminal action or participation in a criminal offense, or their origin, status or allocation is to be concealed due to causes associated with a criminal offense;
3/ rules for making cash payments which exceed a determined amount, registration of such payments and archiving the documents prepared in connection thereto.

Art.101. 73 1 . The President of Narodowy Bank Polski may within his supervisory functions recommend that a bank:
1/ undertake measures necessary to restore its financial liquidity or achieve the standards mentioned in Art.100 item 5.1;
2/ increase its capital;
3/ refrain from specified forms of advertising.
2. Upon concluding that the bank is consistently failing to implement the recommendations mentioned in item 1 above, or when activities of the bank are performed in gross violation of the applicable law or statutes, or when the bank creates significant threat to the interests of owners of savings and deposits accumulated in the bank, the President of Narodowy Bank Polski, after submitting a written admonition, may:
1/ apply to the appropriate body of the bank to recall the President, Vice-President or any other member of the Management Board directly responsible for the irregularities reported;
2/ suspend the duties of performance of members of the Management Board mentioned in item 1 above, until a motion for their recall may be considered; such suspension in the performance of duties shall consist of excluding such members from making decisions in the name of the bank with respect to its property rights and obligations;
3/ restrict the scope of activities of the bank; this restriction shall consist of a prohibition against entering into any new agreements;
4/ withdraw the authorization for the bank's establishment and order its liquidation.
3. The restriction or withdrawal of the authorization for a bank's establishment may also be effected when it is determined that the bank does not fulfil the requirements provided for in the authorization for the bank's establishment.
4. When a bank incurs a loss in an amount exceeding the value of its own funds or when there exists a factual threat of occurring of losses to such an extent, the President of Narodowy Bank Polski may, irrespective of whether it applies the measures mentioned in items 2 /1-3/ above, establish a temporary administration board for a period not longer than 3 months. The temporary administration board shall make decisions relating to the

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73/ In wording given in art.l.44 of the Act mentioned in note 2.

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property rights and duties of the bank.
5. Measures undertaken within supervisory functions may not infringe upon any agreements signed by the bank.
6. Any decisions which are described in this Article may be appealed by to the appropriate commercial court.

Art.102. Banks and branches or representative offices of foreign banks are obliged to:
1/ notify Narodowy Bank Polski of the commencement and termination of its banking activities, and of any changes in the scope of such activities;
2/ 74 permit authorized employees of Narodowy Bank Polski to perform action mentioned in Art.100 item 4, particularly in giving access to the books, balances, registers, plans, reports and other documents of a bank, and also to permit upon written demand, authorized employees of Narodowy Bank Polski to make copies of such documents and to other information and to provide explanations demanded by such employees;
3/ 75 immediately inform Narodowy Bank Polski of measures which shall be undertaken to remove irregularities disclosed during such supervision, and observe the decisions of Narodowy Bank Polski issued as a result of assessing the bank activities performed.

Art.103. The organization of supervision over bank operations and its implementation shall be regulated by the Act on Narodowy Bank Polski.

Chapter 10

Rehabilitation, Liquidation and Bankruptcy of a Bank

Art.104.1. In case of a loss or threatened loss, or in case of a threatened insolvency of a bank, the Management Board of such a bank shall promptly inform the President of Narodowy Bank Polski, and shall undertake rehabilitating measures.
2. The Management Board is obliged to submit to the President of Narodowy Bank Polski, the programme of such rehabilitating measures within one month from the occurrence of circumstances which require rehabilitation measures.
3. The President of Narodowy Bank Polski, may obligate the Management Board of the bank to undertake rehabilitation measures, when required to protect savings and deposits of such a bank, or when the Management Board does not undertake the measures described in item 1 above.

Art.105.1. If the Management Board does not submit a rehabilitation

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74/ In wording given in art.l.45 of the Act mentioned in note 2.

75/ In wording given in art.l.13 of the Act mentioned in note 4.

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programme within the time period provided for in Art.104 item 2, or when such a programme or its performance does not indicate an improvement in the economic and financial condition of the bank, the President of Narodowy Bank Polski may establish a Board of Commissioners for a defined period of time, which however, will not exceed one year.
2. 76 The Board of Commissioners shall receive authority to pass resolutions in all matters reserved by the Law and by the statutes of the bank to the governing bodies of the bank. On the date that the Board of Commissioners is established, the Management Board of the bank shall be dissolved. The authority of the remaining bodies of the bank shall be suspended for the period of the Board of Commissioners' operation.
3. The Board of Commissioners:
1/ shall develop and agree, with the President of Narodowy Bank Polski, on a rehabilitation programme for the business of the bank, and shall assure its due performance and shall inform the President of Narodowy Bank Polski, and active bodies of the bank not less than once every three months of the results achieved by the implementation of such a programme;
2/ may draw refinancing credit from Narodowy Bank Polski.
4. 77 The decision issued by the President of Narodowy Bank Polski regarding the establishment of the Board of Commissioners, shall define in detail the tasks of the Board and deadlines for their performance.
5. 78 The bank may appeal the contents of a decision issued pursuant to item 4 above, to the appropriate commercial court.

Art.106. Banks which are associated within a bank which benefits from the rights of and performs the duties of a central cooperative union in the understanding of the Cooperative Law, shall inform the President of such a bank about their losses and shall submit their rehabilitation programme to the President of such a bank, who in such cases shall have the authority provided for in Art.104 point 3 and in Art.105 points 1 and 4.

Art.107.1. 79 If the funds of a bank are reduced by 50% as a result of losses and the Management Board /Board of Commissioners/ will not undertake effective measures assuring the revival of such funds

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76/ In wording given in art.l.46 of the Act mentioned in note 2.

77/ In wording given in art.l.14a/ of the Act mentioned in note 4.

78/ Added by art.l.14b/ of the Act mentioned in note 4.

79/ In wording given in art.l.47a/ of the Act mentioned in note 2.

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within a determined period of time, the President of Narodowy Bank Polski, may:
1/ permit such a bank to be taken over by other banks;
2/ order liquidation of the bank.
2. 80 The detailed conditions and procedures for taking over a bank or its liquidation shall be determined in each case by decisions issued by the President of Narodowy Bank Polski.
3. 81 A bank taking over another bank shall assume all obligations and receivables of the bank being taken over, as well as its other assets and liabilities. On the date the bank is being taken over, its governing bodies shall be dissolved. The taking over bank may alter the employment and salary conditions of employees of the bank that is being taken over, and may terminate contracts of employment with that bank pursuant to the applicable terms of notice.
4. A decision to liquidate a State-owned bank shall be announced in the "Monitor Polski".
5. 82 A bank may appeal the decision mentioned in item 2 above, to the appropriate commercial court.

Art.108.1. If, according to the balance sheet, the assets of a bank shall be insufficient to cover its liabilities, the Management Board or Board of Commissioners shall notify the President of Narodowy Bank Polski, who shall suspend operations of the bank and shall apply to the Voivodship Court with jurisdiction over the bank's principal office to announce such bank's bankruptcy.
2. Actions mentioned in item 1 above, may be taken by the President of Narodowy Bank Polski, also on its own initiative.
3. An Ordinance on suspending business of the bank shall be announced in public in a manner adopted by such a bank.

Art.109. During suspension of its activities a bank:
1/ shall discharge its liabilities arising from savings, deposits, current accounts and refinancing credit, with priority given to the obligations with respect to legal and natural persons who are not members /stockholders/ of the bank; the discharge of all other obligations shall be suspended;
2/ no new credits or loans shall be issued without the consent of the President of Narodowy Bank Polski;
3/ no dividends or interest on shares shall be paid out.

Art.110.1. In considering the motion to announce bankruptcy, the court shall hear the representative of the President of Narodowy

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80/ In wording given in art.l.15a/ of the Act mentioned in note 4.

81/ In wording given in art.l.47b/ of the Act mentioned in note 2.

82/ Added by art.l.15b/ of the Act mentioned in note 4.

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Bank Polski and a person managing the bank that is the subject of the motion.
2. The court shall appoint a Syndic of the assets from among persons knowledgeable in the organization and rules of operation of banks. Also another bank may be appointed a Syndic.

Art.lll.l. Upon announcing of bankruptcy:
1/ the Syndic assumes control of the management of the bankrupt bank;
2/ rights and duties of the President and Vice-Presidents of the liquidator and the Board of Commissioners are suspended and bodies of the bank are dissolved;
3/ the Syndic shall be obligated to serve a notice of termination of employment with bank employees observing the applicable terms of notice conditions, and with the provisions preventing or restricting the permissibility of dissolving or terminating such contracts being ineffective; salaries due to employees are subject to satisfaction according to procedures described in Art.1025 of the Code of Civil Procedure;
4/ the time period concerning the pursuit of claims against the bankrupt bank shall be suspended until the day on which resolution of the judge-commissioner refusing acceptance of the claim has become legally effective.
2. The President of Narodowy Bank Polski shall announce bankruptcy of a State-owned bank in the "Monitor Polski".

Art.112. Immediately upon appointment, the Syndic shall enter into the bank's register its bankruptcy and shall announce in a newspaper of national circulation a notice to creditors to file their claims within three months of the announcement date. Upon the expiration of this period of time, the judge-commissioner shall ex officio set a hearing to make a settlement with the creditors as to the method and scope of satisfying their claims, summoning also Narodowy Bank Polski to participate in the hearing.

Art.113.1. If no settlement is reached with the creditors, the judge-commissioner shall determine a date until which offers to purchase the bank may be submitted by banks and shall inform them about the terms of purchasing and filling such offers.
2. If more than one offer is received, the Syndic shall set a hearing to determine an oral bidding procedure. The bank submitting the highest price shall have the priority to purchase the bank.
3. The right to purchase is granted by the judge-commisioner.
4. Purchase of the bank shall take effect free from all encumbrances, except for the obligations arising from savings, deposits and current accounts, as well as land servitudes.
5. After the order granting the right to purchase the bank becomes binding /item 3 above/, the judge-commissioner shall cause the purchaser of the bank to be registered into the bank's register.

Art.114.1.If the bank is not purchased according to the procedures described above, the judge-commissioner shall determine a date when offers may be submitted to purchase portions of such bank's assets and shall make public the terms of the purchase and deadlines for submitting the offers.
2.Provisions of Art.113 items 2 and 3 shall apply to the purchase of a portion of a bank's assets.
3. Purchase of a portion of a bank's assets shall take place free from any encumbrances, except for land servitudes.

Art.115. In satisfying any interest accruing from the bankrupt bank and not covered in Art.113 item 4, Art. 1025 of the Code of Civil Procedure shall apply with the interest accruing from savings, deposits and current accounts having first priority.

Chapter 10 83

Penal Provisions

Art.115 .1. Any person who:
1/ earns money by way of accepting savings from people or fixed term deposits with the purpose of granting credits or loans or using such resources without due authorization, or
2/ engages in gainful business in violation of the provisions of this Law and uses in the name of the non-banking entity the terms "bank" or "kasa" to define its business, shall be liable for a penalty of imprisonment up to three years or to that period of restriction of liberty.
2. Any person who commits an act described in item 1 above, acting in substitution for a legal person shall be subject to the same penalty.

Chapter 11

Amendments to the Existing Regulations, Interim and Final Provisions

Art.116.1. /deleted/ 84
2. /omitted/ 85

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83/ Added by art.l.48 of the Act mentioned in note 2.

84/ By art.l.91 of the Act of July 13, 1990 on amendments to the Civil Procedure Code /J.L. no. 55 item 318/ deleting part IV of chapter III volume 2 part 2 /arts. 1072-1080; the Act was effective on October 1, 1990.

85/ As it introduced amendments to the act on social benefits in case of illness and maternity; the text of the regulation includes the announcement.

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Art.116 . 86 1 . Until June 30, 1992 Bank Gospodarki Zywnosciowej /Food Economy Bank/ shall be transformed into a joint stock company bank.
2. The shares fund of the Bank Gospodarki Zywnosciowej shall be transformed into stock equity to be subscribed for by cooperative banks and the State Treasury pro rata to the structure of shareholding on the date of transformation. The resources fund of Bank Gospodarki Zywnosciowej shall become the reserve equity of the joint stock company bank.
3. Cooperative banks may establish regional banks in the form of joint stock companies using portions of assets of Bank Gospodarki Zywnosciowej.
4. Stockholdings of the State Treasury in Bank Gospodarki Zywnosciowej transformed into a joint stock company shall be transferred, subject to item 6 below, to the benefit of regional banks mentioned in item 3 above, or cooperative banks being shareholders in Bank Gospodarki Zywnosciowej within not more than 5 years from the enactment of this Law, under conditions to be agreed upon by such banks.
5. Until deletion from the register, Bank Gospodarki Zywnosciowej shall continue to operate on the basis of the previous regulations.
6. Provisions of the Law of July 13, 1990 on privatization of State-owned enterprises /J.L. no. 51 item 298, 1991 no. 60 item 253 and no. 111 item 480/ shall apply accordingly to making stock available to employees of Bank Gospodarki Zywnosciowej transformed into a joint stock company. Those shares shall not bear voting rights at a General Assembly of Stockholders. The stock shall be made available not later than within two months from the first transfer of stock in accordance with the procedure provided for in item 4 above.
7. In transforming Bank Gospodarki Zywnosciowej the authorities of the Minister of Ownership Transformations resulting from the Law mentioned in item 6, above, shall be performed by the Minister of Finance.
8. The detailed principles and procedure for transforming Bank Gospodarki Zywnosciowej and the procedure for using the assets mentioned in item 3 above, shall be determined by the Council of Ministers by way of an Ordinance.

Art.117. Banks operating upon enactment of this Law shall be banks in the understanding of this Law and shall retain the rights and duties withi the scope not violating the provisions of this Law.

Art.118. The hitherto existing provisions shall apply to agreements concluded by banks and the guarantees and warranties issued before enactment of this Law.

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86/ Added by art.l.49 of the Act mentioned in note 2.

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Art.118 . 87 Provisions of Art.29 of the Law of March 22, 1991 on Public Dealing in Securities and Trust Funds /J.L. no. 35 item 155/ shall not apply to banks in the understanding of this Law.

Art.ll9. /omitted/ 88

Art.120. 89 The Law of February 26, 1982 - Banking Law /J.L. no. 7 item 56, 1983 no. 71 item 318, 1987 no. 33 item 181/ ceases to be legally valid.

Art.121.1. Subject to item 2 below, the currently valid executive acts shall remain in force until the issuance of executive acts provided for in this Law, and in any case no longer than for a period of six months.
2. 90 The currently valid executive acts relating to credits and interest rates on credits issued apply to:
1/ housing construction;
2/ legal and natural persons for agricultural production purposes;
3/ natural persons:
a/ setting up of a household;
b/ young spouse and single persons rearing children;
c/ disabled persons for purchase of mobile chairs and motor vehicles.
3. 91 The Council of Ministers shall cover the differences resulting from reduced interest rates and redeemed credits mentioned in item 2, above, which were issued before December 31, 1989.
4./deleted/ 92

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87/ Added by art.l.50 of the Act mentioned in note 2.

88/ As it was in force until the end of 1990; the text of regulation includes the announcement.

89/ In wording given in art.l.51 of the Act mentioned in note 2.

90/ According to provisions of art.5.2 of the Act of December 28, 1989 on regulating credit relations /J.L. no. 74 item 440 and of 1992 no. 21 item 85/ executive acts regarding interest on credits referred to in art. 121.2 as well as regarding redemption and repayment terms of credits for housing purposes, became ineffective.

9l/ In wording given in art.5.1.1. of the Act of December 28, 1989 on regulating credit relations /J.L. no. 74 item 440/ effective since January 1, 1990.

92/ By art.5.1.2. of the Act mentioned in note 91.

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Art.122. This Law becomes effective upon the date of its announcement. 93

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93 / It was published on February 10, 1989.