EMPLOYEE LOANS AND ALLOWANCE FOR LOAN LOSSES

3 Months Ended

Mar. 31, 2014

EMPLOYEE LOANS AND ALLOWANCE FOR LOAN LOSSES [Abstract]

EMPLOYEE LOANS AND ALLOWANCE FOR LOAN LOSSES

4. EMPLOYEE LOANS AND ALLOWANCE FOR LOAN LOSSES

In the third quarter of 2012, the Board of Directors of the Company approved the Employee Housing Program (the “Housing Program”), which assists employees in purchasing housing in Belarus. The Housing Program was designed to be a retention mechanism for the Company’s employees in Belarus and is available to full-time employees who have been with the Company for at least three years. As part of the Housing Program, the Company will extend financing to employees up to an aggregate amount of $10,000. The Company does not bear any market risk in connection with the Housing Program, as the housing will be sold directly to employees by independent third parties. In addition to the housing loans, the Company issues relocation loans in connection with intra-company transfers, as well as certain other individual loans.

During the three months ended March 31, 2014, loans issued by the Company under the Housing Program were denominated in U.S. Dollars with a five-year term and carried an interest rate of 7.5%.

At March 31, 2014 and December 31, 2013, categories of employee loans included in the loan portfolio were as follows:

	March 31, 2014		December 31, 2013
Housing loans	$	5,767	$	5,896
Relocation and other loans		581		494
Total employee loans		6,348		6,390
Less:
Allowance for loan losses		—		—
Total loans, net of allowance for loan losses	$	6,348	$	6,390

There were no loans issued to principal officers, directors, and their affiliates during the three months ended March 31, 2014 and 2013.

On a quarterly basis, the Company reviews the aging of its loan portfolio to evaluate information about the ability of employees to service their debt, including historical payment experience, reasons for payment delays and shortfalls, if any, as well as probability of collecting scheduled principal and interest payments based on the knowledge of individual borrowers, among other factors.

As of March 31, 2014 and December 31, 2013, there were no material past due or non-accrual employee loans. The Company determined no allowance for loan losses was required regarding its employee loans as of March 31, 2014 and December 31, 2013 and there were no movements in provision for loan losses during the three months ended March 31, 2014 and 2013.