Central Bank of Bolivia

Board of Directors

BOARD RESOLUTION NO. 033/2015

SUBJECT: ECONOMIC POLICY ADVISORY - APPROVAL OF THE CREATION OF SPECIAL MONETARY REGULATION DEPOSITS

VIEWED:

• The Political Constitution of the State promulgated on February 7, 2009.
• Law No. 1670 of October 31, 1995 of the Central Bank of Bolivia (BCB).
• The BCB Statute approved by Board Resolution No. 128/2005 of October 21, 2005 and its subsequent modifications.
• The Report from the Economic Policy Advisory BCB-APEC-SIE-INF-2015-18 of March 10, 2015.
• The Report from the Legal Affairs Management BCB-GAL-SANO-INF-2015-96 of March 10, 2015.

CONSIDERING:

• That the Political Constitution of the State in its article 328 provides that the BCB, in coordination with the economic policy determined by the Executive Branch, is empowered to determine and execute monetary policy.
• That the Economic Policy Advisory, through report BCB-APEC-SIE-INF-2015-18, considering the recent evolution of price variations, regulated credit targets, and the need to contract short-term liquidity, recommends the creation of Special Monetary Regulation Deposits in order to control the liquidity of the financial system, preventing second-round inflationary effects.
• That the Legal Affairs Management in Report BCB-GAL-SANO-INF-2015-96 states that there are no observations to the proposal presented by the APEC, as it falls within the current legal framework and the powers expressly conferred on the Issuing Entity to fulfill its purpose; and concludes that within the framework indicated in Report BCB-APEC-SIE-INF-2015-18, the proposal made by the APEC is legally appropriate and it is the competence of the Board of Directors to consider its approval.
• That the BCB Board of Directors, in its capacity as the highest authority of the Institution, is responsible for defining its policies, specialized regulations of general application, and internal rules, being empowered to issue norms and adopt general decisions that may be necessary to fulfill the functions, competencies, and powers

//2. B.D. No. 033/2015

assigned by Law to the Issuing Entity, as established in articles 44 and 54 item o) of Law No. 1670 and articles 9, 11, and 24 of the BCB Statute.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1 (Object)

Approve the creation and implementation of Special Monetary Regulation Deposits - Second Offer (DERM-2) directed at Financial Intermediation Entities (EIFs).

Article 2 (Amount)

The offering of DERM-2 will reach a total amount of up to Bs2,000 million.

Article 3 (Offering Period)

EIFs interested may voluntarily demand DERM-2 between Thursday, March 12 and Friday, April 3, 2015, inclusive, or until the total offering amount is exhausted.

Article 4 (Term)

The maturity term of the DERM-2 is July 10, 2015, regardless of the date of resource constitution.

Article 5 (Allocation Method)

Entities will be served according to the "first come, first served" modality.

Article 6 (Remuneration)

DERM-2 will be remunerated at an Annual Effective Rate (TEA) of 1.75%, payable at maturity.

Article 7 (Restrictions)

Resources constituted by EIFs for the concept of DERM-2 will be immobilized at the BCB and cannot be used by EIFs to meet legal reserve requirements, nor to guarantee or carry out other types of operations.

//3. B.D. No. 033/2015

Article 8 (Participants)

All entities that have the operating authorization from the Financial System Supervision Authority (ASFI) may acquire DERM-2.

Article 9 (Operational Procedures)

Operational procedures related to the implementation of DERM-2 will be determined by the Open Market Operations Committee (COMA).

Article 10.- The Presidency and General Management are charged with the execution and compliance of this Resolution.

La Paz, March 10, 2015

---

Marcelo Zabalaga Estrada

Reynaldo Yujra Segales

Abraham Pérez Alandia

Ronald Polo Rivero

Sergio Velarde Vera