Central Bank of Bolivia

Board of Directors

BOARD RESOLUTION NO. 006/2019

SUBJECT: ECONOMIC POLICY ADVISORY - APPROVAL OF MAXIMUM LIMIT FOR FOREIGN INVESTMENTS BY INSURANCE COMPANIES.

VIEWED:

• Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia.
• Law No. 1883 of June 25, 1998, on Insurance.
• Supreme Decree No. 25201 of October 16, 1998, which approves the Regulations of Law No. 1883.
• Report from the Economic Policy Advisory BCB-APEC-SIE-INF-2019-2 of January 4, 2019.
• Report from the Legal Affairs Management BCB-GAL-SANO-DLBCI-INF-2019-2 of January 7, 2019.

CONSIDERING:

• That Law No. 1883 in its article 35 establishes that the Central Bank of Bolivia (BCB) will periodically set the maximum limit for investments by Insurance Companies in securities of issuers constituted abroad, which may not exceed fifty percent (50%) of the resources for investment.
• That Supreme Decree No. 25201 in its article 18 determines that the Board of Directors of the BCB must annually set the maximum limit for foreign investments by Insurance Companies.
• That Law No. 1670 in its articles 6 and 14 establishes that the Issuing Entity must execute monetary policy and regulate the amount of money and the volume of credit according to its monetary program, and also ensure the strengthening of international reserves to allow the normal functioning of the country's international payments.
• That the Economic Policy Advisory in its Technical Report BCB-APEC-SIE-INF-2019-2 recommends reducing the percentage from ten percent (10%) to eight percent (8%) as the maximum limit for foreign investments for Insurance Companies valid for the 2019 fiscal year.

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//2. B.R. No. 006/2019

That the Legal Affairs Management, in its Report BCB-GAL-SANO-DLBCI-INF-2019-2 concludes that the approval of the maximum limit for foreign investments by insurance companies for the 2019 Fiscal Year is legally appropriate.

THEREFORE, THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA RESOLVES:

Article 1.- Establish for the 2019 fiscal year the maximum limit of foreign investment for Insurance Companies of seven percent (7%) of their investment resources.

Article 2.- Communicate the preceding decision to the Insurance and Pension Supervisory Authority (APS), so that it authorizes the limits within the maximum established in this Resolution and establishes the adaptation period for companies that have foreign investments exceeding 7% of their investment resources on the date of approval of this Resolution.

Article 3.- Board Resolution No. 006/2018 of January 9, 2018, is hereby repealed.

Article 4.- The Presidency and General Management are charged with the execution and compliance of this Resolution.

La Paz, January 8, 2019

Pablo Ramos Sánchez Gabriel Herbas Camacho Sergio Velarde Vera Abraham Pérez Alandia Ronald Polo Rivero