Board of Directors Resolution No. 096/2020

BOARD OF DIRECTORS RESOLUTION NO. 096/2020 SUBJECT: FINANCIAL ENTITIES MANAGEMENT – APPROVAL OF THE REGULATION OF LIQUIDITY CREDITS TO THE PRODUCTIVE DEVELOPMENT BANK MIXED CORPORATION SEEN: The Political Constitution of the State (CPE) promulgated on February 7, 2009. Law No. 1670 of the Central Bank of Bolivia (BCB) of October 31, 1995. Law No. 393 of Financial Services of August 21, 2013. Law No. 1294, Exceptional Law for Deferral of Credit Payments and Temporary Reduction of Basic Services Payment, modified by Law No. 1319 of August 25, 2020. Supreme Decree No. 4331 of September 7, 2020. The BCB Statute approved by Board of Directors Resolution No. 128/2005 of October 21, 2005 and its subsequent modifications. Report BCB-GEF-SASF-DAN-INF-2020-19 of September 9, 2020, from the Financial Entities Management (GEF). Report BCB-GAL-SANO-DLBCI-INF-2020-85 of September 9, 2020, from the Legal Affairs Management (GAL). CONSIDERING: That the CPE in its Article 327 establishes that the BCB is a public law institution, with legal personality and its own assets. Within the framework of the State's economic policy, it is the function of the BCB to maintain the stability of the internal purchasing power of the currency, to contribute to economic and social development. That in its Article 328 the CPE indicates among the attributions of the BCB, in coordination with the economic policy determined by the Executive Branch, in addition to those indicated by Law: to determine and execute monetary policy, execute exchange rate policy, regulate the payment system, authorize the issuance of currency and manage international reserves. That Law No. 1670 in its Article 2 determines that the object of the BCB is to procure the stability of the internal purchasing power of the national currency. In its Article 36 it provides that to attend to liquidity needs in duly justified and qualified cases by its Board of Directors, by absolute majority of votes, the BCB may grant to banks and

//2. B.D.R. No. 096/2020 financial intermediation entities credits for terms of ninety days, renewable. The credit limits and their guarantees shall be established by the Board of Directors of the BCB, by absolute majority. To consider the requests for these credits, the BCB will carry out non-binding consultations with the Superintendency of Banks and Financial Entities, current Financial System Supervision Authority. That paragraphs a) and q) of Article 54 of Law No. 1670, establish that the Board of Directors has among its attributions, to cite norms and adopt general decisions that were necessary for the BCB to comply with the functions, competencies and faculties assigned to it by Law and others indicated by Law and those that are necessary for the fulfillment of its functions. That Law No. 393 of Financial Services in paragraph a) of its Article 179 establishes that the Productive Development Bank Mixed Corporation (BDP- S.A.M.), has among its functions within the framework of its first and second-tier activities, to provide financial and non-financial services to the different actors of the plural economy by itself or through third parties. That the cited Law, in its Article 430 indicates that the BCB may grant liquidity credits to financial intermediation entities with guarantee of the constituted legal reserve, as well as with other guarantees determined by the Issuing Entity, according to regulations approved by its Board of Directors. Likewise, in paragraph e) of its Article 464 it determines that financial intermediation entities may not give their assets as guarantee, directly or indirectly, under any modality provided by Law. This limitation does not reach the guarantees that are granted for the liquidity credits of the BCB, according to Regulation of the Issuing Entity, nor to the guarantees granted in contracts made with the State according to legislation issued for the case. That Law No. 1294 modified by Law No. 1319, in paragraph I of its Article 1 establishes that the Financial Intermediation Entities that operate in national territory must carry out the automatic deferral of the payment of amortizations of credit to capital and interest and other types of levies of the national credit system from the Declaration of Emergency due to the Coronavirus (COVID-19) Pandemic to December 31, 2020, to all borrowers without distinction. That Supreme Decree No. 4331 has the object of giving continuity to the policies of strengthening the economy necessary to mitigate the negative effects of the Coronavirus (COVID-19). In its Article 2 it provides that the BCB within the framework of the attributions, regulations, conditions and amounts established by the Board of Directors of the BCB, the BDP-S.A.M. may request liquidity credits from the BCB with the guarantee of second-tier credit portfolio, which will be channeled with a spread not greater than one hundred (100) basis points to the Development Financial Institutions (IFD) and to the Savings and Credit Cooperatives (CAC) with operating license granted by the Financial System Supervision Authority (ASFI) that channel credits of the Special Support Program

//3. B.D.R. No. 096/2020 for the Micro, Small and Medium Enterprise, established in Supreme Decree No. 4216, of April 14, 2020. That the cited Article, also provides that the BDP-S.A.M. will evaluate access to this financing with information reported by the Financial Intermediation Entities and will define the mechanisms of linkage with the Special Support Program for the Micro, Small and Medium Enterprise and that the ASFI within the scope of its competence, will supervise compliance with what is provided in this Supreme Decree. That numerals 1) and 9) of its Article 11 of the BCB Statute establish that the Board of Directors of the Issuing Entity has the attributions of approving general decisions and dictating the norms that were necessary for the BCB to comply with the functions, competencies and faculties that are assigned to it by Law, as well as approving by absolute majority of votes, the liquidity credits for terms of up to 90 days, renewable, to the financial intermediation entities. That in response to the non-binding consultation carried out by the BCB based on Article 36 of Law No. 1670 of the Central Bank of Bolivia, the Financial System Supervision Authority answered via note ASFI/DEP/R-104965/2020 of September 7, 2020 referred to "Liquidity Credits for Development Financial Institutions and Savings and Credit Cooperatives" concluding that it is foreseeable that the IFD and CAC will require a greater quantity of liquid assets and that ASFI has no objection to the BCB considering the credit requests presented to the Issuing Entity. CONSIDERING: That through Report BCB-GEF-SASF-DAN-INF-2020-19, the GEF states that the liquidity of the financial system has deteriorated as a result of the propagation of COVID-19. Likewise, it concludes that although the BCB has implemented a set of measures to maintain liquidity at adequate levels, the promulgation of Law No. 1319 for deferral of credits until December 2020 considerably increases the liquidity risk, especially in non-bank entities such as the IFD and CAC and that this type of entities currently has limited access to the liquidity windows of the BCB, for which it submits for consideration of the Board of Directors of the BCB the approval of the Regulation of Liquidity Credits to the Productive Development Bank Mixed Corporation to comply with Supreme Decree No. 4331. That in Report BCB-GAL-SANO-DLBCI-INF-2020-85, the GAL concludes that there is no legal impediment for the Board of Directors of the BCB, by majority of votes, to approve the Regulation of Liquidity Credits to the Productive Development Bank S.A.M, according to the technical conditions proposed by the GEF through Report BCB-GEF-SASF￾DAN-INF-2020-19 under the provisions of article 36, paragraphs a) and q) of article 54 of Law No. 1670 and numerals 1) and 9) of article 11 of the BCB Statute.

//4. B.D.R. No. 096/2020 That since the deferral of the payment of amortizations of credits to capital and interest and other types of levies from the Declaration of Emergency due to the Coronavirus (COVID-19) Pandemic to December 31, 2020, provided by Law No. 1294 modified by Law No. 1319, affects the Financial Intermediation Entities, mainly the IFD and CAC, and since they are going through liquidity needs, and with the purpose of preserving a stable financial system, the issuance of the Regulation of Liquidity Credits to the Productive Development Bank Mixed Corporation is considered convenient. THEREFORE, THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA RESOLVES: Article 1.- Based on the justification made and within the framework of what is established in Supreme Decree No. 4331 of September 7, 2020, to attend to liquidity needs, approve the Regulation of Liquidity Credits to the Productive Development Bank Mixed Corporation that in Annex forms part of this Resolution. Article 2.- The Regulation of Liquidity Credits to the Productive Development Bank Mixed Corporation will enter into force from the date of its approval. Article 3.- For the purpose of granting the liquidity credits provided in the cited Regulation, the Acting President of the BCB is authorized to sign the corresponding Contract. Article 4.- The Presidency and the General Management are in charge of the execution and compliance of this Resolution. La Paz, September 10, 2020 Signed: Armando Pinell Siles

Signed: Walter Morales Carrasco Signed: Alejandro Banegas Rivero Signed: José Gabriel Espinoza Yañez

//5. B.D.R. No. 096/2020 ANNEX REGULATION OF LIQUIDITY CREDITS TO THE PRODUCTIVE DEVELOPMENT BANK MIXED CORPORATION Article 1.- (Purpose). The purpose of this Regulation is to norm the requirements and guidelines for the granting of liquidity credits of the Central Bank of Bolivia (BCB) to the Productive Development Bank S.A.M. (BDP-S.A.M.), with guarantee of its second-tier credit portfolio within the framework of what is provided by Supreme Decree No. 4331 of September 7, 2020. Article 2.- (Destination of Resources). I. The resources of the liquidity credits received by the BDP-S.A.M. must be channeled in favor of the Development Financial Institutions (IFD) and of the Savings and Credit Cooperatives (CAC), with Operating License granted by the Financial System Supervision Authority (ASFI) as liquidity credits, with a spread not greater than 100 (one hundred) basis points. II. For the purposes of this Regulation the IFD and the CAC will be considered as Beneficiary Entities. Article 3.- (Guarantees). I. The liquidity credits granted by the BCB in favor of the BDP-S.A.M. are guaranteed with its second-tier credit portfolio to financial entities with local risk rating equal to or higher than A1 (A+). II. This guarantee must be constituted with the second-tier credit portfolio of the BDP￾S.A.M., with the support of the financial information contained in its Financial Statements and must be maintained at all times at least a ratio of one point five (1.5) to one (1) between the capital balance of the second-tier credit portfolio that guarantees the liquidity credits and the balance of the liquidity credits and must be substituted in case that the rating of a certain Financial Entity decreases from A1 (A+). Article 4.- (Amount). The maximum accumulated amount of liquidity credits granted by the BCB in favor of the BDP S.A.M. corresponds to the capital balance of the second-tier credit portfolio with rating equal to or higher than A1 (A+) of the BDP-S.A.M. contemplated in its Financial Statements. Article 5.- (Term). The term for the liquidity credits will be up to 90 (ninety) calendar days, renewable for similar terms up to a maximum of 3 times each one, being necessary the cancellation of the interests for each renewal. Article 6.- (Contract). I. The BCB and the BDP-S.A.M. must sign a contract that establishes the scope, conditions, rights, obligations and other aspects through which the disbursements of the liquidity credits will be operationalized.

//6. B.D.R. No. 096/2020 II. For the signing of the corresponding contract, the BDP-S.A.M. must remit to the BCB a written request signed by its legal representative in which it requests the enabling of the liquidity credit window for the BDP-S.A.M. within the framework of what is provided in Supreme Decree No. 4331, attaching: a) Financial Statements in which the balance of its Second-Tier Credit Portfolio to Financial Entities with a rating equal to or higher than A1 (A+) is accredited; b) Minutes of its Board of Directors that authorizes the signing of the contract by which the BCB will grant liquidity credits to the BDP-S.A.M.; c) Legalized copy of the Power of Attorney Deed of Legal Representation with the faculties to enter into contracts; d) Simple copy of the Identity Card of the legal representative; e) Updated Commerce Registry. III. The Contract to be signed between both entities, will contemplate the way in which the guarantee would be executed in case of non-compliance by the BDP-S.A.M., the same that will be instrumented through a Conditional Assignment of Credits by the BDP￾S.A.M in favor of the BCB. Article 7.- (Disbursement and Cancellation). I. Once the contract between the BCB and the BDP-S.A.M. is signed, the disbursements, renewals and cancellations will be materialized through individual requests of liquidity credits, same that must be presented in writing by the BDP-S.A.M. to the BCB for each request in attention to the requirement of the liquidity credit made by the Beneficiary Entities, which must be attached to the respective liquidity credit request. II. The BCB will disburse the funds through credit to the Current Account and/or Reserve Account of the BDP-S.A.M. in the BCB. IV. At the expiration of the term of each liquidity credit operation, the BDP S.A.M. must credit to its Current Account and Reserve Account in the BCB the amount to be canceled. Article 8.- (Currency). The liquidity credits granted by the BCB in favor of the BDP￾S.A.M. and in turn the disbursements of the BDP-S.A.M to the Beneficiary Entities must be carried out solely in national currency. Article 9.- (Interest Rates). The interest rate applicable for the liquidity credits granted by the BCB in favor of the BDP-S.A.M. is 2% annual. Article 10.- (Reporting Obligation). The BDP-S.A.M. must inform the BCB within a maximum period of three (3) business days subsequent to each disbursement the financial conditions agreed in each operation with the Beneficiary Entities.

//7. B.D.R. No. 096/2020 Article 11.- (Credit Management). The operational management of the liquidity credits of the BCB to the BDP-S.A.M. is in charge of the Financial Entities Management of the BCB. -0-