Resolution No. JPRF-G-2022-019 — Approves the 2022 Budget of BANECUADOR

Resolution No. JPRF-G-2022-019 THE FINANCIAL POLICY AND REGULATION BOARD

CONSIDERING:

That, Article 226 of the Constitution of the Republic of Ecuador prescribes that public servants and persons acting under state authority shall exercise only the competencies and powers attributed to them in the Constitution and the Law;

That, Article 280 of the Constitution of the Republic defines the National Development Plan as the instrument to which public policies, programs, and projects, as well as the programming and execution of the State budget, shall be subject;

That, the second clause of Article 70 ibid., regarding the National System of Public Finances, states: “All entities, institutions, and organizations included in Articles 225, 297, and 315 of the Constitution of the Republic shall be subject to the SINFIP, under the terms provided in this code, without prejudice to the autonomous management faculty of administrative, economic, financial, budgetary, and organizational order that the Constitution or laws establish for certain entities”;

That, Article 109 of the Organic Code of Planning and Public Finances orders that the budgets of the entities and organisms indicated in that legal body shall enter into force and be mandatory from January 1 of each year;

That, Article 101 supra, provides: “In the formulation of budget drafts for the public sector, including those of public companies, decentralized autonomous governments, public banking, and social security, the technical norms, guidelines, classifiers, and catalogs issued by the governing body of the SINFIP shall be obligatorily observed”;

That, through Article 13 of the Organic Monetary and Financial Code, Book 1, the Financial Policy and Regulation Board was created as part of the Executive Function, as a legal person of public law, with administrative, financial, and operational autonomy, responsible for the formulation of credit, financial, securities, insurance, and prepaid comprehensive health care services policy and regulation; and its composition was determined;

That, Article 14.1, numeral 14, literal a) of the Organic Monetary and Financial Code establishes as a function of the Financial Policy and Regulation Board to annually approve the budget of the entities of the public financial sector, their reforms, as well as regulate their execution;

That, the first transitional provision of the Organic Law for Economic Development and Fiscal Sustainability mandates “In order to achieve the technical and capital parameters necessary to grant low-cost and long-term credit to the agricultural and productive sectors, within sixty (60) days counted from the publication of this law in the Official Register, the competent instances will initiate the pertinent procedures to merge BANECUADOR EP [sic] and the CORPORACIÓN FINANCIERA NACIONAL EP [sic] into a single entity called BANCO DE FOMENTO ECONÓMICO DEL ECUADOR”;

That, in the Codification of Monetary, Financial, Securities, and Insurance Resolutions, Book I "Monetary and Financial System", Title II "National Financial System", Chapter XXXIII "On the Government and Administration of the Public Financial Sector", Section III "On the Public Financial Sector Capital Budget", Subsection I, the Budget Management Norms for Entities of the Public Financial Sector are contained;

That, Chapter XXXIII "On the Government and Administration of the Public Financial Sector", Section III "On the Public Financial Sector Capital Budget", Subsection I, was renumbered by Article 2 of Resolution No. 647-2021-F of the Monetary and Financial Policy Board, published in Official Register No. 415 of March 22, 2021;

That, on September 27, 2021, the Ministry of Economy and Finance issued the guidelines for the programming and formulation of the General State Budget corresponding to the fiscal year 2022 and the Four-Year Budget Programming 2022-2025. Within that instrument, section 4.2.2. develops the guidelines for public banking budgets;

That, through Resolution No. JPRF-F-2021-003 of December 10, 2021, the Financial Policy and Regulation Board, based on the guidelines issued by the Governing Body of Public Finances, issued the guidelines for the preparation of the budget draft of Public Financial Entities for the year 2022;

That, through Resolution No. JPRF-F-2021-009 of December 30, 2021, the schedule for the presentation and approval of budget drafts for the current year was modified, in accordance with the Second and Third Transitional Provisions of Section XI “Guidelines for the preparation of the budget draft of Public Financial Entities for the year 2022”, of Chapter XXXIII "On the Government and Administration of the Public Financial Sector", Book I "Monetary and Financial System" of the Codification of Monetary, Financial, Securities, and Insurance Resolutions;

That, through letter No. BANECUADOR-BANECUADOR-2021-1044-OF of December 30, 2021, the General Manager proceeded to send the budget draft for the economic year 2022 to this collegiate body;

That, on January 6, 2022, through letter No. JPRF-JPRF-2022-0002-O, the President of the Financial Policy and Regulation Board requested the pronouncement of the Ministry of Economy and Finance within the approval procedure of the budget draft of BANECUADOR B.P. for the economic year 2022;

That, through letter No. MEF-VE-2022-0007-O of January 12, 2022, the Vice Minister of Economy attaches report No. MEF-CESFM-2022-004 of January 11, 2022, and pronounces himself in the following terms: “… does not recommend the approval of the Budget Draft of BanEcuador B.P. corresponding to the economic year 2022, according to the figures contained in Annex 1 and in concordance with the unfavorable vote issued by the MEF in the Extraordinary Session of the Board of Directors of BANECUADOR B.P. instrumented via email from December 28 to 29, 2021;

That, on January 17, 2022, the JPRF through Resolution No. JPRF-G-2022-017, decided not to approve the budget of BANECUADOR B.P., corresponding to the economic year 2022, which was sent by the General Manager of BANECUADOR B.P. to the Financial Policy and Regulation Board with letter No. BANECUADOR-BANECUADOR-2021-1044-OF of December 30, 2021;

That, through memorandum No. BANECUADOR-BANECUADOR-2022-0026-MEM of January 21, 2022, the General Manager of BANECUADOR B.P. sent a new budget draft for the year 2022 to be elevated to the knowledge and approval of the Board of Directors;

That, the Board of Directors of BANECUADOR B.P., through resolution No. D-2022-002 of January 25, 2022, approved the respective budget draft for the year 2022;

That, through letter No. BANECUADOR-BANECUADOR-2022-0040-OF of January 25, 2022, the General Manager of BANECUADOR B.P. sent to the Financial Policy and Regulation Board the adjusted budget draft for the economic year 2022;

That, on January 25, 2022, through letter No. JPRF-JPRF-2022-0021-O, the President of the Financial Policy and Regulation Board requested the pronouncement of the Ministry of Economy and Finance within the corresponding approval procedure;

That, through letter No. MEF-VE-2022-0011-O of January 26, 2022, the Vice Minister of Economy sends report No. MEF-CESFM-2022-006 of January 26, 2022, where the approval of the Budget Draft of BANECUADOR B.P. corresponding to the economic year 2022 is recommended;

That, the Technical Secretary of the Financial Policy and Regulation Board through memorandum No. JPRF-SETEC-2022-0012-M of January 26, 2022, sends to the President of the JPRF the technical and legal analyses that support the pertinence of this resolution, contained in reports No. JPRF-CT-2022-0014 and No. JPRF-CJ-2022-0009 of January 26, 2022, respectively;

That, the Financial Policy and Regulation Board, in an extraordinary session held by technological means convened on January 26, 2022, and carried out via video conference on January 27, 2022, reviewed the budget of BANECUADOR B.P. for the economic year 2022; and,

In exercise of its functions,

RESOLVES:

SINGLE ARTICLE.- Approve the budget of BANECUADOR B.P., sent by the general management with letter No. BANECUADOR-BANECUADOR-2022-0040-OF of January 25, 2022, corresponding to the economic year 2022, which shall be valid from January 1, 2022, according to the attached annex, which forms an integral part of this resolution.

GENERAL PROVISIONS:

FIRST.- The legal representative of BANECUADOR B.P. shall be responsible, within the framework of the Law, for the execution of the budget.

SECOND.- It is ordered that BANECUADOR B.P. send the approved budget for the economic year 2022 to the Ministry of Economy and Finance and to the National Assembly within a term of 30 days, counted from the issuance of this resolution, in compliance with what is established in Articles 112 of the Organic Code of Planning and Public Finances and 94 of the General Regulation to the Organic Code of Planning and Public Finances.

TRANSITIONAL PROVISION: In case there has been any budgetary movement or impact directly related to the operability of BANECUADOR B.P. in the days prior to the issuance of this resolution, these movements must be regularized during the first month of budget execution of the fiscal year 2022.

Such movements and regularizations shall not affect the total amount of the Institutional Budget sent for approval to the Financial Policy and Regulation Board.

FINAL PROVISION.- This resolution shall enter into force from the date of its issuance, without prejudice to its publication in the Official Register. Publish this resolution on the website of the Financial Policy and Regulation Board, within a maximum term of two days from its issuance.

COMMUNICATE.- Given in the Metropolitan District of Quito, on January 27, 2022.

THE PRESIDENT, Mgs. María Paulina Vela Zambrano

The aforementioned resolution was processed and signed by Master María Paulina Vela Zambrano, President of the Financial Policy and Regulation Board, in the Metropolitan District of Quito, on January 27, 2022.- I CERTIFY.

TECHNICAL SECRETARY Dr. Nelly Arias Zavala

ANNEX SOURCE: BANECUADOR B.P.