Money, money circulation and credit - стр. 23

There are several examples of the handover notes: «the order of» (a name of a new bill holder follows with the date and signature of an endorser) or «pay instead of me».

The bill’s credibility could be enforced by an aval – a guarantee of an exchange bill. A party which issued it – avalist (as a rule a bank) accepts responsibility for the bill’s commitments execution from a bill drawer’s (endorser’s) side. An aval could be drawn in a kind of a note on a bill or on an additional page (allonge).

Under the article 83 of the Law «About the circulation of bills in the Republic of Kazakhstan» dated from April 28, 1997 the discount houses (banks) can perform the following kinds of operations with the bills of exchange:

– the bills for collection acceptance;

– the bills discounting and avalization;

– the bills settlement by a payer services rendering and the domiciled bills settlement;

– the bills acceptance in the order of mediation.

All the above listed operations are executed by the commercial banks under a licence issued by the Committee for the control and supervision of financial market and financial organizations of the national bank of Republic of Kazakhstan.

The transition toward a market economy of Kazakhstan conditioned the return to an economic turnover of many financial instruments which were not in demand in the period of planned economy but are widely used in the modern economically developed countries. One of these instruments is a bill of exchange.

If compare the development of bank operations with the bills of exchange in the beginning of 90^>th of the last century and their today’s station it could be noted that nowadays the volume of these operations widely increased though it leaves much to be desired.

If in the beginning and middle of 90^>th of the XX^>th century the banks almost did not use the bills but in the end of 90^>th and the beginning of 2000^>th there were some activity in this sector of banking services. The most widespread bills’ operations today are discount, rediscount, avalizing of bills. The main reason of the bills of exchange market activation of the country was the development and implementation of the row of legislative acts concerning the bills of exchange turnover:

The second-tier banks rules for conducting of transactions with bills of exchange and promissory bills approved by a decision of the board of directors of the National Bank of the Republic of Kazakhstan dated from November 15, 1999 № 397.

The bills of exchange accounting rules of the second-tier banks of the Republic of Kazakhstan approved by a decision of the board of directors of the National Bank of the Republic of Kazakhstan dated from November 15, 1999 № 396.