Board Resolution No. 062/2020

BOARD RESOLUTION NO. 062/2020 SUBJECT: INTERNATIONAL OPERATIONS MANAGEMENT – APPROVES THE AMENDMENT TO THE REGULATION FOR THE ADMINISTRATION OF INTERNATIONAL RESERVES.

HAVING SEEN: The Political Constitution of the State approved by referendum on January 25, 2009, and published on February 7, 2009. Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia (BCB). Board Resolution No. 097/2018 of July 31, 2018, and its amendment. The Reports from the International Operations Management of the BCB, BCB-GOI-SRES-DNI-INF-2020-20 and BCB-GOI-SRES-DNI-INF-2020-22, dated June 24 and July 3, 2020, respectively. The Report from the Legal Affairs Management of the BCB, BCB-GAL-SANO-DLBCI-INF-2020-50, dated June 26, 2020.

CONSIDERING: That the Political Constitution of the State establishes in its Article 328 that it is the responsibility of the BCB, in coordination with the economic policy determined by the Executive Branch, in addition to those indicated by Law, to administer international reserves.

That in accordance with what is provided in Article 16 of Law No. 1670, the Central Bank of Bolivia has the function of administering and managing International Reserves, being able to invest them and deposit them in custody, as well as dispose of and pledge them, in the manner it considers most appropriate for the fulfillment of its object and functions and for their adequate safeguard and security.

That within the framework of the aforementioned, the Issuing Entity has approved through Board Resolution No. 097/2018 the Regulation for the Administration of International Reserves, establishing the policies and norms for its correct administration.

That the Reports from the International Operations Management of the BCB, BCB-GOI-SRES-DNI-INF-2020-20 and BCB-GOI-SRES-DNI-INF-2020-22, recommend approving the modifications to the Regulation for the Administration of International Reserves.

That the Report from the Legal Affairs Management of the BCB, BCB-GAL-SANO-DLBCI-INF-2020-50, concludes that the project of Modifications to the Regulation for the Administration of International Reserves proposed by the GOI is legally appropriate, as it does not contravene the current legal framework, being the competence of the Board of Directors of the BCB to consider its approval.

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

Article 1.- Modify Articles 12 and 15 of the Regulation for the Administration of International Reserves as follows:

SAYS Article 12.- (Reference Comparators). The following reference comparators are established:

Portfolio Segment	Reference Comparator (Benchmark)
Precautionary	Working Capital: LIBID Overnight average in USD
0-3 Year Portfolio	Merrill Lynch US Treasuries Index 0 to 3 years
Liquidity Portfolio	LIBID 6 months average in USD
Medium-term Investment 0-5 years	BIS MTI Bonds 0-5 years
Global (1)	Merrill Lynch Bonds Index 0-5 years AAA in EUR (EGAV), FIXBIS 6 months in AUD, FIXBIS 6 months in CAD, 6-month deposit index in CNH, and BISP CNY Index of Chinese Government Bonds in CNY.

(1) The weight of each index in the comparator will be based on the average balance of each Portfolio and its currencies.

SHOULD SAY “Article 12.- (Reference Comparators).

Portfolio Segment	Reference Comparator (Benchmark)
Precautionary	Working Capital: ICE BofA SOFR Overnight Rate Index
0-3 Year Portfolio	Merrill Lynch US Treasuries Index 0 to 3 years
Liquidity Portfolio	LIBID 6 months average in USD
Medium-term Investment 0-5 years	BIS MTI Bonds 0-5 years
Global (1)	Merrill Lynch Bonds Index 0-5 years AAA in EUR (EGAV), FIXBIS 6 months in AUD, FIXBIS 6 months in CAD, 6-month deposit index in CNH, and BISP CNY Index of Chinese Government Bonds in CNY.

(1) The weight of each index in the comparator will be based on the average balance of each Portfolio and its currencies.”

SAYS Article 15.- (Credit Risk). V. The maximum credit loss in a year, measured by Value at Risk (VaR), is 1% for the total of International Monetary Reserves, with a confidence level of 99.9%.

SHOULD SAY “Article 15.- (Credit Risk). V. The maximum credit loss in a year, measured by Value at Risk (VaR), is 1.25% for the total of International Monetary Reserves, with a confidence level of 99.9%.”

Article 2.- The Presidency and General Management are charged with the execution and compliance of this resolution.

La Paz, July 7, 2020

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