Technical Standards for the Recognition and Qualification of Asset Appraisers for Securitization Processes

Alameda Juan Pablo II, between 15 and 17 Av. Norte, San Salvador, El Salvador. Tel. (503) 2281-8000 www.bcr.gob.sv Page 1 of 11 CNBCR-09/2024 NDMC-37 TECHNICAL STANDARDS FOR THE RECOGNITION AND QUALIFICATION OF ASSET APPRAISERS FOR SECURITIZATION PROCESSES Approval: 09/23/2024 Validity: 10/09/2024

THE NORMS COMMITTEE OF THE CENTRAL RESERVE BANK OF EL SALVADOR,

CONSIDERING: I. That Article 46, subsection a) of the Asset Securitization Law establishes that Securitization Funds may be constituted and integrated with real estate assets, which must be appraised by experts registered with the Superintendency of the Financial System or other entities whose registries are recognized by the Superintendency, using appraisal methods of recognized technical value approved by this body. II. That the second paragraph of Article 51 of the Asset Securitization Law establishes that prior to the alienation of assets by the Originator to a Securitization Fund, such assets must be subject to the opinion of an appraiser qualified by the Superintendency of the Financial System. III. That Article 93, subsection g) of the Asset Securitization Law empowers the Securities Superintendency, now the Superintendency of the Financial System, with regulatory authority that, by virtue of the entry into force of the Law on Supervision and Regulation of the Financial System, was transferred to the Central Reserve Bank of El Salvador, through its Norms Committee, to issue Technical Standards of general application that are necessary for the operation of Securitization processes and for the sound development of the Securities Market. IV. That Article 3, subsection h) of the Law on Supervision and Regulation of the Financial System establishes that it is the competence of the Superintendency to authorize the registrations, registry entries, modifications, and cancellations thereof, of persons, institutions, and operations subject to such requirement, in accordance with the laws on the matter; V. That Article 78 of the Law on Supervision and Regulation of the Financial System establishes that the Superintendency of the Financial System will organize and keep updated the registries entrusted to it by the laws, among which are those relating to Experts in cases specified by law.

THEREFORE, by virtue of the regulatory powers conferred by Article 99 of the Law on Supervision and Regulation of the Financial System,

AGREES to issue the following:

Alameda Juan Pablo II, between 15 and 17 Av. Norte, San Salvador, El Salvador. Tel. (503) 2281-8000 www.bcr.gob.sv Page 2 of 11 CNBCR-09/2024 NDMC-37 TECHNICAL STANDARDS FOR THE RECOGNITION AND QUALIFICATION OF ASSET APPRAISERS FOR SECURITIZATION PROCESSES Approval: 09/23/2024 Validity: 10/09/2024

TECHNICAL STANDARDS FOR THE RECOGNITION AND QUALIFICATION OF ASSET APPRAISERS FOR SECURITIZATION PROCESSES

CHAPTER I OBJECT, SUBJECTS, AND TERMS

Object Art. 1.- These Standards aim to define the minimum requirements that other registries of real estate asset appraisers, different from that of the Superintendency of the Financial System, must meet to be recognized by this body. Such recognition will enable professionals registered in them to perform appraisals of real estate assets participating in Securitization processes. Likewise, it establishes the minimum requirements for natural or legal persons interested in being qualified by the Superintendency of the Financial System as experts to perform appraisals of financial assets in Securitization processes.

Subjects Art. 2.- The subjects obliged to comply with the provisions established in these Standards are: a) Entities interested in receiving recognition of the registry of real estate asset appraisers different from that of the Superintendency of the Financial System; and b) Natural or legal persons interested in receiving the qualification of asset appraisers for financial assets for securitization processes.

Terms Art. 3.- For the purposes of these Standards, the terms indicated below have the following meaning: a) Financial Assets: Any value, right, or financial instrument that can integrate securitization funds, in accordance with the Asset Securitization Law and the norms issued by the Norms Committee of the Central Reserve Bank of El Salvador; b) Real Estate Assets: Real estate, land, buildings, and constructions of all kinds adherent to the soil. Real estate assets include plants rooted in the soil, pending fruits, mine deposits, doors, windows, slabs, etc., of buildings, and in general, all natural objects or objects of use or ornamentation that are fixed and stable to real estate, so as to form a single body with them; c) Central Bank: Central Reserve Bank of El Salvador; d) Securitization Fund: Independent patrimony, different from that of the Securitization Company and the Originator, formed by a set of assets and liabilities that result from or are integrated as a consequence of the development of the respective securitization process. The assets of the Fund will have the main purpose of generating payments for the securities issued against it; e) Securitization Law: Asset Securitization Law; f) Expert or Appraiser: Natural or legal person authorized to perform the appraisal of assets as established in the Securitization Law and norms issued by the Norms Committee of the Central Reserve Bank of El Salvador, which are applicable; g) Registry: Control system maintained and fed by public or private entities, whose object is to list or register professional persons related to the valuation of assets; h) Representative of Security Holders: Legal person responsible for representing the owners of the securities of each Fund in accordance with what is established in the Asset Securitization Law; i) Superintendency: Superintendency of the Financial System; j) Securitization Company: Legal person that administers Securitization Funds, registered with the Superintendency of the Financial System; and k) Security: Any negotiable amount in an organized market, expressed in monetary terms.

CHAPTER II OF THE EXPERTS AUTHORIZED TO PARTICIPATE IN THE APPRAISAL OF REAL ESTATE ASSETS PARTICIPATING IN SECURITIZATION PROCESSES

Experts who may participate in the appraisal of real estate assets Art. 4.- In accordance with what is established in subsection a) of Article 46 of the Securitization Law, the experts authorized to perform appraisals on real estate assets are the following: a) Those registered in the registry kept by the Superintendency of Experts Appraisers (CNBCR-09-2017), issued by the Central Bank through its Norms Committee; and b) Those registered in other registries recognized by the Superintendency, in accordance with the requirements set forth in these Standards. In any case, for experts registered in other registries to participate in the appraisal of real estate assets in securitization processes, they must also comply with the specific requirements set forth in these Standards.

CHAPTER III REQUIREMENTS FOR THE RECOGNITION OF OTHER REGISTRIES

Art. 5.- For the Superintendency to recognize other registries, it is indispensable that they be maintained by institutions or entities legally established and additionally that within their respective regulations, such registries be fully authorized to qualify the registration of professionals in areas such as: Civil Engineering, Architecture, or related areas.

Documentation Art. 6.- For the Superintendency to recognize other registries, they must present the following documentation: a) Request the respective recognition from the Superintendency. Such request must be signed by the Legal Representative of the registry in question; b) Present a certification, signed by the Legal Representative of the registry in question, stating that the interested party is recorded or registered in it and that as of that date, they are current in the fulfillment of their obligations with said registry; c) Present documentation accrediting that said registry is legally established, as well as the internal regulations to which the professionals registered in them are subject; and d) That the Legal Representative of the corresponding registry present a document expressing the commitment to provide the information required by the Superintendency regarding the registered professionals who intend to provide real estate valuation services for Securitization processes.

Art. 7.- Once the recognition of the registry is granted, the experts recorded in them who wish to participate in the appraisal of real estate assets for Securitization processes must comply with the requirements set forth in Chapter Four of these Standards, insofar as they are applicable.

Art. 8.- Experts registered in other registries recognized by the Superintendency may only participate in the appraisal of real estate assets in Securitization processes.

CHAPTER IV REQUIREMENTS FOR THE QUALIFICATION OF ASSET APPRAISERS FOR FINANCIAL ASSETS PARTICIPATING IN SECURITIZATION PROCESSES

Requirements for qualification of experts Art. 9.- Experts qualified to appraise financial assets susceptible to securitization, which intend to integrate a Securitization Fund, when these are negotiable securities on the stock exchange, will be Specialized Agents in Security Valuation, authorized by the Superintendency in accordance with the Securities Market Law.

Documentation Art. 10.- For an expert to participate in the appraisal of other financial assets other than those defined in Article 9 of these Standards, they must be previously qualified by the Superintendency, for which they will comply with the following requirements: a) Requirements for Natural Persons: i. Request the respective qualification from the Superintendency, in accordance with the request and documentation established in Article 11 of these Standards; ii. Be a professional with a university degree in Industrial Engineering, Public Accounting, Business Administration, Economics, or other related fields; iii. Have training in finance or, in default thereof, have received specialized training in asset valuation and demonstrate experience in the performance of asset appraisals; iv. Demonstrate that they have sufficient technical equipment, installed capacity, and sufficient and suitable human resources to perform appraisals; v. Not have been suspended in the exercise of their profession; vi. Not have been sanctioned by the Superintendency; vii. Not be a debtor, co-debtor, or guarantor of credits from institutions belonging to the Salvadoran Financial System, to which fifty percent (50%) or more of cleaning reserves have been constituted, in accordance with the regulations applicable in this regard. In the case of foreigners or Salvadorans domiciled abroad, they must also demonstrate that in their respective countries of domicile and origin, they do not find themselves in the aforementioned circumstance; viii. Not be in a state of bankruptcy, suspension of payments, or creditors' composition; ix. Not have been convicted by a final judgment in El Salvador or abroad for having committed or participated fraudulently in the commission of any crime; and x. Not have been judicially proven to have participated in activities related to drug trafficking and related crimes, and money laundering and asset laundering, terrorism financing, and financing of the proliferation of weapons of mass destruction, in accordance with the legislation and regulation in this matter. b) Legal Persons that intend to participate in the valuation of financial assets must additionally comply with the following requirements: i. That the purpose stated in the Deed of Constitution or the constitution form of simplified joint-stock companies and their modifications, is not incompatible with the activity related to asset valuation; ii. That their Legal Representative and the members of their administrative body comply with the following:

1. The requirements indicated in romans i, and vi to x of subsection a) of this article and those set forth in Article 12 of these Standards;
2. Be Salvadorans domiciled in the country, and in the case of foreigners, prove their residence and physical presence in the country;
3. Be over twenty-five (25) years of age; and
4. Be of recognized honorability and financial competence. iii. Demonstrate that they have sufficient technical equipment, installed capacity, and sufficient and suitable human resources to perform appraisals.

Content of the request Art. 11.- The request established in roman i of subsection a) of Article 10 of these Standards must be accompanied by the following documentation: a) Requirements for Natural Persons: i. Curriculum vitae and a notarially certified copy of the academic title of the interested party, duly accredited by the Ministry of Education or by the competent authority in the country of origin if it concerns titles issued abroad; ii. Certification issued by the General Directorate of Penal Centers or by the equivalent authority when it concerns foreigners, stating that the applicant has no criminal record. When the applicant is a legal person, this requirement must be met by its Legal Representative and by the members of its administrative body; iii. Legible copy of the Unique Identity Document of the applicant, their Tax Identification Number, which will be in accordance with what is established by the Tax Administration, and the Taxpayer Registration Card for the Tax on the Transfer of Movable Goods and the Provision of Services, if applicable; iv. Documentation accrediting that the applicant and their technical team have training in finance or specialized training in asset valuation and experience in the performance of financial asset appraisals; and v. Sworn declaration signed by the applicant or their Legal Representative or attorney-in-fact, if applicable, declaring compliance with the requirements established in these Standards. b) Legal Persons that intend to participate in the valuation of financial assets must additionally annex to what is defined in romans ii to v of subsection a) of this article, the following information: i. Notarially certified copy of their current Social Pact and the latest credential of the election of their administrative body. If as of that date the term for the election of administrators has already expired, a statement must be presented expressing that as of that date no new administration has been elected and therefore, the previously elected one continues in the full exercise of its functions. It is understood that in accordance with what is provided in the second paragraph of Article 265 of the Commercial Code, such statement will only be admissible in the case that six (6) months have not elapsed from the expiration of the period for which the respective administrators were elected. After said period has elapsed, a copy of the credential of election of the new administration, which is valid as of that date, must be presented, which must be registered in the Commerce Registry; and ii. If the current Social Pact establishes that to request this circumstance, the Legal Representative of the applicant needs authorization from any superior body, a notarially certified copy of the certification of the Point of the Act in which such agreement is recorded must be presented. The request and documentation may be presented through the means made available by the Superintendency, which may be electronic. In any case, the period referred to in the first paragraph of Article 13 of these Standards will begin to run from the next business day after the request has been presented.

Art. 12.- Experts, at the time of performing an appraisal of a financial asset that intends to be transferred to a Securitization Fund, must comply with the following requirements: a) Not be a debtor of the Originator or the Representative of Security Holders, for amounts equivalent to or greater than two percent (2%) with respect to the amount of the issuance to be made; b) Not be a director, administrator, or employee of the Originator, the Securitization Company, or the Representative of Security Holders; and c) Not have obtained during the last three years, more than 25% of their income from services provided to the Securitization Company, the Originator, or the respective economic group or financial conglomerate of both. A sworn declaration of compliance with the requirements established in the first paragraph of this article must be presented as an annex to the corresponding appraisal report. Furthermore, in the case that the applicant is a debtor of the Originator or the Representative of Security Holders, they must present a certificate issued by any of them, as applicable, stating the details of the obligations at their charge, the amount granted, and the balance currently active as of that date in terms of principal, interest, and accessories, if any. The Securitization Company will be responsible for verifying that the expert they hire to appraise the assets constituting a Securitization Fund complies with what is defined in this article.

CHAPTER V PROCEDURE FOR THE RECOGNITION AND QUALIFICATION OF EXPERTS

Procedure for the recognition of other registries of asset appraisers and qualification of experts for the valuation of financial assets

Art. 13.- Upon receipt of the request in accordance with what is established in Articles 6, 10, and 11 of these Standards, as applicable, the Superintendency will proceed to verify compliance with the requirements defined in these Standards, having twenty (20) business days to authorize or deny the request. If the request is not accompanied by the complete and duly formatted information detailed in Articles 6, 10, and 11 of these Standards, the Superintendency, due to the lack of necessary requirements, may require the applicant to present the missing documents within a period of ten (10) business days counted from the day following the notification, a period that may be extended at the request of the applicant when there are reasons justifying it. The Superintendency in the same notice will indicate to the applicant that if they do not complete the information within the aforementioned period, it will proceed without further procedure to archive the request, reserving their right to present a new request, which will give rise to a new procedure. If after the analysis of the documentation presented in accordance with Articles 6, 10, and 11 of these Standards, the Superintendency has observations or when the documentation or information presented is not sufficient to establish the facts or information intended to be accredited; the Superintendency will notify the respective applicant to remedy the deficiencies communicated or present additional documentation or information required. The applicant will have a maximum period of ten (10) business days counted from the day following the notification, to remedy the observations or present the additional information required by the Superintendency. The Superintendency may, through a reasoned resolution, extend by up to another ten (10) business days, the period indicated in the previous paragraph, when the nature of the observations or deficiencies notified so requires.

Extension Period Art. 14.- The applicant may present a request for extension of the period indicated in the fifth paragraph of Article 13 of these Standards to the Superintendency, before the expiration of said period, must express the grounds on which it is based, and propose, if applicable, the pertinent evidence. The extension period may not exceed ten (10) business days and will begin from the next business day after the expiration date of the original period.

Suspension of the Period Art. 15.- The period of twenty (20) business days indicated in the first paragraph of Article 13 of these Standards, will be suspended for the days that elapse between the notification of the

Alameda Juan Pablo II, between 15 and 17 Av. Norte, San Salvador, El Salvador. Tel. (503) 2281-8000 www.bcr.gob.sv Page 9 of 11 CNBCR-09/2024 NDMC-37 TECHNICAL STANDARDS FOR THE RECOGNITION AND QUALIFICATION OF ASSET APPRAISERS FOR SECURITIZATION PROCESSES Approval: 09/23/2024 Validity: 10/09/2024 request for information or documentation referred to in the paragraphs