Circular CONAU 1-1665: Monthly Accounting Reporting Regime. Minimum Capital Requirement and Integration (R.I.-C.M.). Adjustments

"Año de la Reconstrucción de la Nación Argentina" COMMUNICATION “A” 8196 13/02/2025 TO FINANCIAL ENTITIES:
Ref.: Circular
CONAU 1-1665:
Monthly Accounting Reporting Regime. Minimum Capital Requirement and Integration (R.I. - C.M.). Adjustments.
___________________________________________________________________________ We address you to inform you of the modifications introduced in the reporting regime referenced, as a consequence of the issuance of Communication “A” 8068. In this regard, Section 5. Operational Risk Requirement is adapted, with effect from March/25. Likewise, we inform you that, in accordance with what is provided in point 2.8. of Section 1 of “Submission of Information to the Central Bank”, the accrual of debits corresponding to the cut-off after the expiration of the first reporting period that corresponds based on the entry into force of these modifications will be exempted. Finally, the sheets corresponding to be replaced in the consolidated text of this reporting regime are attached. We greet you attentively. CENTRAL BANK OF THE ARGENTINE REPUBLIC Mariana A. Diaz Estela M. del Pino Suárez Manager of the Reporting Regime Deputy General Manager of the Reporting Regime and Protection of Users of Financial Services

ANNEX

5.1. Procedure rules
5.1.1. Operational risk requirement for Group 1 entities
It will be determined monthly by the following expression:
CRO = BIC x ILM where:
CRO: capital requirement for operational risk.
ILM: internal loss multiplier equal to 1.
BIC: business indicator component = ∑ BIi x αi where; αi: marginal coefficient, determined based on the BI bracket:

Category	BI Bracket (in thousands of millions of euros*)	Marginal BI Coefficients (αi)
1	≤ 1	12 %
2	1 < BI ≤ 30	15 %
3	> 30	18 %

(*) The equivalent amount in pesos will be calculated at the selling exchange rate of the BNA at the close of business on the last business day of the previous month in question.

That is, for a BI = 35,000 m EUR, the BIC = (1 x 12%) + (30-1) x 15% + (35-30) x 18% = 5.370 m EUR.

BI: Absolute Value (ILDCProm + SCProm + FCProm + RMProm).
The line item corresponding to the BIC will be reported at the amount calculated based on the marginal coefficients applicable. VA: Absolute Value. ILDCProm: Interest, leases, and dividends component. SCProm: Services component. FCProm: Financial component. RM Prom: Total monetary result. For the line items corresponding to each component, the amounts resulting from performing the calculations for their determination will be reported. Each term within the 3 components and the monetary result must be reported, with respect to each of the 3 periods of 12 months, restated for inflation. When these terms refer to results, the restatement will operate from the month of origin of each concept until the close of the calculation period of the 36 months (that is, n-1). B.C.R.A. MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Version: 6a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 1

Regarding assets that generate interest, it will be the amount resulting from restating the balances at the close of each of the 3 periods of 12 months, from that date until the close of the calculation period of the 36 months (n-1). First, the value of the net line items that correspond (for example, income minus expenses) must be determined for each consecutive 12-month period, and then the average of the 3 periods is calculated.

5.1.2. Operational risk requirement for Group 2 entities
It will be determined monthly by the following expression:

C_RO = ∑_{t=1}^{n} (a * IB_t)

Where:
a: 15 % n: number of 12-month consecutive periods in which the IB is positive, taking into account the last 36 months prior to the month of calculation. Maximum n = 3 If n = 0: a requirement equivalent to the limit provided in point 7.3. of the rules on Minimum Capital of financial entities must be observed. To this effect, financial entities of Group “A” will receive the treatment established for financial entities of Group “B”. (points 5.1.3.2 and 5.1.3.3 of this rule). IBt: gross income of consecutive 12-month periods -as long as it is positive-, corresponding to the last 36 months prior to the month in which the calculation is performed, expressed in homogeneous currency of the month prior to that in which the calculation is performed. IB = (financial income - financial expenses) Plus (income from services – expenses from services) Plus (other profits - other losses) Plus total monetary result. For the purpose of reporting the results of each of the 12-month periods, it will be necessary to restate each concept included from its month of origin until the close of the calculation period of the 36 months (that is, n-1). B.C.R.A. MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Version: 8a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 2

5.1.3. Reduction of the requirement for financial entities of Group 2 that belong to Groups “B” and “C”.
5.1.3.1. This requirement reduction will apply to Group 2 entities that belong to Groups “B” and “C” and are not subsidiaries or branches of globally systemically important entities (G-SIB).
5.1.3.2. Reduction. General limit.
The corresponding reduction in requirement will be reported in line items 36000001 or 36000004 when the applicable limits on the average of the credit risk requirements for the 36 months prior to the report are lower than those reported in code 70300000. This calculation will respond to the following expression:

Reduction = 70300000 - [0.17 * (∑_{i=1}^{36} ERC (n-1) + ... + ERC (n-36)) / 36]

Where:
(∑_{i=1}^{36} ERC (n-1) + ... + ERC (n-36)) / 36 = average of the credit risk requirements corresponding to the 36 months prior to the period to be reported, expressed in homogeneous currency of the month prior to that in which the calculation is performed. ERC = Line item 70100000 + ∑ 8XX00000 This reduction will apply with respect to entities that meet the requirements mentioned in point 5.1.3.1., preceding.

5.1.3.3. Reduction. Special limits.
When the entity's rating in all aspects provided for in the pertinent regulatory provisions allows the application of percentages lower than those indicated in point 5.1.3.2., the resulting requirement reductions will be reflected in line items 36000002, 36000003, 36000005 or 36000006 -as long as their amount is lower than that recorded in line item 70300000-, as explicitly stated below:
B.C.R.A.
MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Entity % Line Item Calculation
B 17 36000001 70300000 - [0.17 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] C 14 36000004 70300000 - [0.14 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] Version: 7a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 3

To this effect, the last reported rating will be considered for the calculation of the requirement that corresponds to integrate in the third month following that in which the notification takes place.

5.1.3.4. A single line item 3600000Y will be reported, reflecting the entity's situation with respect to its rating; the average of the credit risk requirements will be calculated at this Institution based on data on credit risk requirements reported in previous periods.

5.1.4. New entities The monthly minimum capital requirement for operational risk will be determined taking into account what is provided in the rules on “Minimum Capital of financial entities”.
B.C.R.A.
MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Rating Entity % Line Item Calculation
1, 2 or 3
B 11 36000002 70300000 - [0.11 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] C 8 36000005 70300000 - [0.08 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] 1 or 2 B 7 36000003 70300000 - [0.07 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] C 5 36000006 70300000 - [0.05 * (∑{i=1}^{36} ERC(n-1) + ... + ERC(n-36)) / 36] Version: 5a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 4

5.2. Information model
5.2.1. Business Indicator (BI)

Code	Concept	Observations
33000000	BIC	The calculated BIC will be reported

5.2.2. Components of the Business Indicator (BI)

Code	Concept
34000000	BI
34100000	ILDC (Prom) - Interest, leases, and dividends component
3411000X	Interest income
3412000X	Interest expenses
3413000X	Interest-bearing assets
3414000X	Dividend income
34200000	SC (Prom) - Services component
3421000X	Other income from operations
3422000X	Other expenses from operations
3423000X	Income from fees and commissions
3424000X	Expenses from fees and commissions
34300000	FC (Prom) - Financial component
3431000X	Net result of trading portfolio
3432000X	Net result of investment portfolio
34400000	RM (Prom) - Total Monetary Result
3440000X	RM - Total Monetary Result

B.C.R.A.
MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Version: 5a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 5

5.2.3. Gross Income

Code	Concept	Observations
3500000X	Gross Income	The gross income of period X will be reported

5.2.4. Correlation with Balance Sheet line items

Code	Concept	Accounting Accounts
3510000X	Financial income	510000 except relevant part of 511102 / 515102 / 511099 / 511106 / 515099 / 515106 / 511541 / 515541
3520000X	Financial expenses	520000 except 521023 / 521036 / 521074 / 525004 and relevant part of 521103 / 525103 / 521107 / 521101 / 525107 / 525101 / 521541 / 525541
3530000X	Income from services	540000 except relevant part of 541018 / 545018
3540000X	Expenses from services	550000 except relevant part of 551018 / 555018
3550000X	Other profits	570000 except 570006 / 570009 / 570021 / 570024 and relevant part of 570003 / 570025 / 570045 / 570034
3560000X	Other losses	580000 except 580006 / 580009 / 580018 / 580021 / 580027 / 580031 / 580033 and relevant part of 580003 / 580035 / 580045 / 580041 / 580046 / 580047 / 580048 / 580050 / 580056
3570000X	Total Monetary Result	620000

B.C.R.A.
MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Version: 1a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 6

5.2.5. Reduction of requirement for entities of Groups “B” and “C”.

Code	Concept
3600000Y	Reduction of requirement

References:
X = 1 to 3, where:
1 = months 1 to 12
2 = months 13 to 24
3 = months 25 to 36
Y = 1 to 6, where:
1 = reduction by application of the 17% limit
2 = reduction by application of the 11% limit
3 = reduction by application of the 7% limit
4 = reduction by application of the 14% limit
5 = reduction by application of the 8% limit
6 = reduction by application of the 5% limit

B.C.R.A.
MONTHLY ACCOUNTING REPORTING REGIME
4. MINIMUM CAPITAL REQUIREMENT AND INTEGRATION (R.I.-C.M.)
Section 5. Operational Risk Requirement
Version: 1a. COMMUNICATION “A” 8196 Effective Date:
01/03/2025 Page 7