Circular 12-43

Insurgentes Sur No. 1971, Plaza Inn, Col. Guadalupe Inn C.P. 01020, Delegación Álvaro Obregón, Ciudad de México. Tel.: 5255 1454-6000 www.gob.mx/cnbv México, D.F., a 4 de marzo de 2002. CIRCULAR 12-43

TO INVESTMENT COMPANIES:
The Bank of Mexico, through official letter S01/120-2002, forwarded to this Commission its Circular 2/2002 issued on March 4, 2002, which is transcribed below for your knowledge and compliance:
OPERATIONS WITH SAVINGS PROTECTION BONDS.

The Bank of Mexico, based on Article 2 of the Federal Revenue Law for the fiscal year 2002, Article 7, section I, and Article 26 of its Law, and C O N S I D E R I N G a) That Article 2 of the Federal Revenue Law for the fiscal year 2002 authorizes the Institute for the Protection of Bank Savings (IPAB) to issue securities with the sole purpose of exchanging or refinancing its financial obligations, in order to meet its payment obligations, provide liquidity to its titles and, in general, improve the terms and conditions of its aforementioned financial obligations;

b) That the cited provision in the previous paragraph authorizes the Bank of Mexico to act as a financial agent for the IPAB, for the issuance, placement, purchase and sale, in the national market, of the debt-representing securities of the aforementioned Institute, and in general, for the service of such debt, as well as to operate on its own account with the aforementioned securities;

c) That the Secretariat of Finance and Public Credit has interpreted that the securities, titles and documents issued by the aforementioned Institute resemble those issued or guaranteed by the Federal Government, for the purposes of their registration in the National Securities Registry, and

d) That it is convenient to expand the primary market for Savings Protection Bonds (BPAs) issued by the IPAB, allowing the participation in the primary auctions of said securities by investment companies, has resolved the following:

Insurgentes Sur No. 1971, Plaza Inn, Col. Guadalupe Inn C.P. 01020, Delegación Álvaro Obregón, Ciudad de México. Tel.: 5255 1454-6000 www.gob.mx/cnbv SOLE PROVISION.- Investment companies that are authorized, in accordance with the regime applicable to them, to acquire Savings Protection Bonds (BPAs) issued by the IPAB, registered in the National Securities Registry and with respect to which the Bank of Mexico acts as a financial agent for their issuance and placement in the national market, may participate in the auction directed at investment companies and as provided in the following paragraph.

For the purposes of the primary placement of BPAs, interested investment companies must deliver their bids, in accordance with what is established in numeral 4 of the immediate banking day prior to the date of placement of the securities to be auctioned. The Bank of Mexico may announce another date or time for a particular auction. The Bank of Mexico will inform each bidder individually no later than 12:00 hours on the day the auction in question has been held, through the SIAC-BANXICO, the result of the quantity of BPAs that, if applicable, have been assigned to them and the total prices that must be paid for said BPAs.

T R A N S I T O R Y

FIRST.- This Circular shall enter into force on March 5, 2002.

SECOND.- To be able to participate in the aforementioned BPA auctions through the Systems of the Bank of Mexico, investment companies regulated by the Investment Companies Law, through their respective operators and specialized investment companies for retirement funds interested, must sign the respective contract or agreement with the Bank of Mexico.

For the purposes of the aforementioned and in order to be informed of the documentation they must present, those companies must contact the Sub-gerencia of Instrumentation of National Operations of this Central Bank, located at Avenida 5 de Mayo, number 1 (Anexo Guardiola), third floor, Colonia Centro, México D.F., 06059, phones 5237.23.12 and

Bank of Mexico Circular 1/2002 was made known through our Circular 12-42 of January 22, 2002.