Notice No. 01/97 of March 3, 1997

CENTRAL BANK OF ANGOLA

OFFICE OF THE GOVERNOR

NOTICE NO. 01/97

of March 3, 1997

Whereas mandatory reserves are a monetary policy instrument adopted by Central Banks, whose main objective is the control of liquidity in the economy;

Whereas Central Banks require Financial Institutions to hold a percentage of their deposits in cash, as a preventive measure against the inflationary process, by restraining the growth of the money supply;

Whereas the Organic Law of the Central Bank of Angola establishes, in point 1 of its Article 25, that it may require Financial Institutions to establish mandatory reserves;

Whereas there is a need to implement mechanisms that lead to the materialization of the establishment of mandatory reserves, with the Central Bank, in accordance with Article 60 of the aforementioned Organic Law,

IT IS HEREBY DETERMINED:

ARTICLE 1

Authorized financial institutions that collect deposits from companies and individuals shall maintain mandatory reserves with the Central Bank of Angola, and are prohibited from opening deposit accounts at order in any other financial institution within the country, except in special cases subject to prior authorization by the Central Bank of Angola.

ARTICLE 2

1. The mandatory reserve ratio is established by Instruction issued by the Central Bank of Angola, and may be amended whenever necessary to control economic liquidity.

1

CENTRAL BANK OF ANGOLA

OFFICE OF THE GOVERNOR

2. Mandatory reserves shall be levied monthly, in national currency, on an incidence base referenced to the respective previous month, and shall be non-interest-bearing. Only reserves exceeding the monthly requirement may earn interest.

ARTICLE 3

The Central Bank of Angola shall publish the regulation regarding the establishment of mandatory reserves.

ARTICLE 4

Notice No. 01/91 of October 16, 1991, is hereby repealed.

ARTICLE 5

This Notice takes effect immediately.

PUBLISH

Luanda, March 3, 1997.

THE GOVERNOR

Sebastião Bastos Lavrador

2