De Nederlandsche Bank N.V.and the National Bank of Romania and, hereinafter referred to as "the Parties", expressing their mutual interest in establishing and promoting bilateral ties in banking supervision and wishing to achieve a common understanding on issues related to banking regulation in order to facilitate co-operation in supervising the activities of credit organizations, have agreed as follows:

1. For the purposes of this Memorandum:
   • "countries" are Netherlands and Romania;
   • the "banking supervision authorities" are De Nederlandsche Bank N.V., which is responsible for the licensing and supervision of credit organizations in Netherlands and the National Bank of Romania, which is responsible for the licensing and supervision of credit organizations in Romania;
   • a "credit organization" (a bank) is an entity which carries on banking business (general or specialized) and whose activities are subject to licensing and banking supervision under the laws of the countries; and
   • "supervisory information" is the information received or obtained in the process of fulfilling their supervisory functions, as well as through the exchange of information or through the conduct of on-site inspections in accordance with this Memorandum, by either of the banking supervision authorities. Supervisory information shall not include information relating to any individual deposit account, unless this information is relevant for an ongoing inspection of a credit organization.
   
   In accordance with definitions used by the Basle Committee on Banking Supervision:
   • a "branch" of a credit organization (a branch) is an operating entity which does not have a separate legal status and is thus an integral part of a credit organization incorporated in one of the countries;
   • a "subsidiary credit organization" (a subsidiary bank) is a legally independent institution, wholly-owned by, or otherwise under the control of a credit organization which is incorporated in the country other than that of the subsidiary;
   • a "representative office" is an office through which the interests of a credit organization are promoted or assisted but at which no banking business is carried on; and
   • "home country" is the country of incorporation of a credit organization that has set up a branch or a subsidiary bank or a representative office in the other country ("host country").
2. To maintain reliability and stability of the national banking systems, the Parties shall co-operate in the banking supervision of the activities of credit organizations on the basis of the provisions of this Memorandum, subject to the national legislation and the international obligations of each Party.
3. The Parties shall regularly provide, on a reciprocal basis, information on the applicable national banking legislation, banking regulations, banking supervision standards and requirements, and any major changes in them.
4. The Parties agree to hold, if necessary, meetings between them to discuss issues of mutual interest and ways to improve banking supervision over the activities of credit organizations within their respective jurisdictions.
5. Co-operation within the framework of this Memorandum shall be implemented at the initiative of or on the basis of requests for assistance in banking supervision from either Party.
6. A request for assistance shall be made in writing or by any contemporary means of telecommunication.
7. A request for assistance within the framework of this Memorandum may be denied wholly or partially, if the requested Party believes that the fulfillment of the request will run counter to its national legislation or that it may harm important national interests. In such cases, the requesting Party shall be notified about the denial and given the reasons for it in writing.
8. The Parties shall take all necessary measures in order to provide a prompt and as full a reply as possible. They shall also notify one another about the circumstances preventing or delaying the fulfillment of a request for assistance.
9. Each Party shall independently bear the expenses involved in the implementation of this Memorandum, unless a different procedure is agreed upon.
10. The Parties agree to co-operate in supervising credit organizations as follows:
    • 10.1 In licensing banking activities, the Parties agree that:
      • 10.1.1 If a credit organization incorporated in one of the countries applies to the Party in the other country for a license (permission) to open a branch, a subsidiary bank, or a representative office, the other Party shall consider such application within the time-limits and in accordance with the procedures established by its national banking legislation or regulations;
      • 10.1.2 The Party receiving an application, as referred to in 10.1.1 above, shall notify the other Party of the details of such an application and obtain the other Party's views as provided by the rules established by the Basle Committee on Banking Supervision;
      • 10.1.3 The Party receiving an application obtains from the other Party such information as it deems necessary to act in the application, including, the amount of own funds and the solvency ratio of the parent bank, whether it is in compliance with the home country banking regulations and the opinion of the home country supervisor about the quality of management, the adequacy of internal control systems and management processes and any information known to the home country supervisor about the prospective managers of the organization proposed to be established in the host country; and
      • 10.1.4 The Party receiving an application shall notify the other Party in writing about its decision with regard to the granting of license (permission) to a credit organization to open a branch, a subsidiary bank, or a representative office, which has applied to it, as provided in 10.1.1 above.
    • 10.2 In exercising branches, subsidiary banks, or representative offices set up in one country by credit organizations incorporated in the other country, the Parties agree that:
      • 10.2.1 The banking supervision authorities of the host country shall exercise prudential supervision over the activities of branches, subsidiary banks, or representative offices set up in accordance with the national banking legislation or regulations; and
      • 10.2.2 The banking supervision authorities of the host country shall not prevent the entities mentioned in 10.2.1 above from submitting information and other reports to their Head Office or parent banks necessary to compile consolidated reports in accordance with the forms established in the home country, provided that such information shall not relate to any individual deposit account.
    • 10.3 With regard to on-site inspections, the Parties agree that:
      • 10.3.1 The banking supervision authorities of the home country shall notify the banking supervision authorities of the host country about their intention to inspect a branch, a subsidiary bank, or a representative office, giving details of the names of examiners, the purposes of the examination and its expected duration. The banking supervision authorities of the host country shall express readiness to provide, at the request of the other Party, any available supervisory information related to the conduct of on-site inspections;
      • 10.3.2 The banking supervision authorities of the host country shall not prevent the banking supervision authorities of the home country from carrying out on-site inspections, as referred to in 10.3.1 above, and shall give the banking supervision authorities of the home country access to supervisory information, as defined in article 1, which they may need to conduct banking supervision provided that if either Party has reasons to believe that an on-site inspection by the other Party is for non-supervisory purposes (such as fiscal/tax and foreign exchange control purposes), such Party shall have the right to prevent the inspection or terminate it; and
      • 10.3.3 Representatives of the banking supervision authorities of the host country have the right to be present during the on-site inspections conducted by the representatives of the banking supervision authorities of the home country.
    • 10.4 In connection with the supervision of the credit organizations incorporated in one country which have branches, subsidiary banks, or representative offices in the other country:
      • 10.4.1 The Parties agree to provide, on a timely basis, information about any events that have the potential to endanger the stability of the activities of a credit organization having operations in the country of one of the Parties, as well as material changes pertaining to such credit organizations such as restrictions to the range of permitted banking operations, suspension or modification or revocation of a license, appointment of a provisional administrator, and re-organization or liquidation of any such credit organization, if this information would be relevant for the banking supervision authority of the host country as it would have an important impact on the branch or subsidiary; and
      • 10.4.2 The banking supervision authority of the host country notifies the banking supervision authority of the home country and provides relevant information regarding any material developments or supervisory concerns in respect of a branch or a subsidiary bank.
11. Information would be shared to the extent reasonable and subject to any relevant statutory provisions, including those restricting disclosure. In addition, the provision of, or request for, information under the Memorandum may be denied on grounds of public interest or national security or when disclosure would interfere with an ongoing investigation.
12. The Parties consider that any information obtained in accordance with the principles of the Memorandum should be used exclusively for lawful supervisory purposes as determined in the relevant laws.
13. Each Party is liable in accordance with the relevant laws and regulations to keep confidential any information related to requests made under the Memorandum, the contents of such requests, and the information obtained pursuant to the Memorandum as well as any related matters, in particular consultations between the Parties. The requesting Party will not disclose any such information unless it is necessary for carrying out its supervisory responsibilities and will not pass on any information to third parties without the prior consent of the requested Party. The Parties will, if they receive any legally enforceable demand for information received from the other Party, promptly notify the other Party and will co- operate in seeking to preserve the confidentiality of such information.
14. It is recognized that employees of both Parties are bound to hold confidential all information obtained in the course of their duties.
15. The Parties will send each other a list of credit organizations which they have authorized and which have operations in either of the Party's jurisdictions.
16. The Memorandum shall be changed or amended only in writing with the signatures of the Parties.
17. The Memorandum shall be drawn up in the English language in two original copies, each Party obtaining one copy.
18. Cooperation and assistance in accordance with this Memorandum of Understanding will continue until the expiration of 30 days after either Party gives written notice to the other Party of its intention to discontinue cooperation and assistance. If either Party gives such notice, cooperation and assistance in accordance with this Memorandum will continue with respect to all requests for assistance that were made before the effective date of notification until the requesting Party withdraws the matter for which assistance was requested. In the event of termination of this Memorandum information obtained under this Memorandum will continue to be treated confidentially.