2023-05-17 | RESOLUCIONES DE DIRECTORIO Nº 078/2023Added · Updated
The Board of Directors of the Central Bank of Bolivia approves financial conditions for liquidity credits to acquiring financial intermediation entities involved in the resolution of Banco Fassil S.A. The resolution sets an annual interest rate of 2% on the credit balance and allows national currency loans with a term of up to 1,080 days, renewable once. These measures are implemented under Article 46 of the Legal Reserve Regulation to facilitate the absorption of assets and liabilities during the intervention procedure.
SUBJECT: ECONOMIC POLICY ADVISORY AND FINANCIAL ENTITIES MANAGEMENT – APPROVE THE FINANCIAL CONDITIONS FOR LIQUIDITY CREDITS TO FINANCIAL INTERMEDIATION ENTITIES IN THE FRAMEWORK OF THE RESOLUTION PROCEDURE OF BANCO FASSIL S.A. UNDER INTERVENTION.
That Article 327 of the Political Constitution of the State states that the Central Bank of Bolivia (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.
//2. B.R. No. 078/2023
That Article 328 of the Political Constitution of the State states that the BCB, in coordination with the economic policy determined by the Executive Branch, in addition to those established by law, has the following attributes: 1. Determine and execute monetary policy. 2. Execute exchange rate policy. 3. Regulate the payment system. 4. Authorize the issuance of currency. 5. Administer international reserves.
That Article 7 of Law No. 1670 determines that the BCB may establish Legal Reserves of mandatory compliance by Banks and financial intermediation entities. Their composition, amount, method of calculation, characteristics, and remuneration shall be established by the Board of the Bank, by an absolute majority of votes. The control and supervision of the Legal Reserve shall correspond to the current Supervisory Authority of the Financial System.
That Article 8 of Law No. 1670 states that the reserve and deposits constituted in the BCB by banks and financial entities shall not be subject to any type of seizure or retention by third parties.
That Article 37 of Law No. 1670 establishes that the BCB will be the depositary of the liquid reserves intended to cover the Legal Reserve and to attend to the payment system and other operations with the BCB of Financial Intermediation Entities subject to the authorization and control of the Supervisory Authority of the Financial System.
That Article 430 of Law No. 393 determines that the BCB may grant liquidity credits to Financial Intermediation Entities with the guarantee of the constituted Legal Reserve, as well as with other guarantees determined by the Issuing Entity, according to a regulation approved by its Board of Directors.
That Article 532 of Law No. 393 provides that to facilitate acquiring entities, within resolution procedures, the absorption of the impact that the acquisition of assets and the assumption of liabilities entail, the BCB may flexibly apply its legal reserve policy and will facilitate liquidity windows with respect to these entities.
That the Sole Final Provision of Law No. 1503 states that within the framework of Articles 327 and 328 of the Political Constitution of the State, the BCB, with the objective of complying with its constitutional mandate, is authorized to apply what is provided in Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia and its modifications, being this sufficient for the development of its functions, without requiring further provisions than said law.
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That Board Resolution No. 075/2023 of May 11, 2023 incorporates into the Legal Reserve Regulation Title IX on Facilitation of Liquidity Credits in the Framework of Resolution Procedures and in its Article 46 establishes that the conditions of liquidity credits within the framework of the present Title shall be determined by the Board of Directors, for each resolution procedure.
That Article 44 of Law No. 1670 provides that the highest authority of the BCB is its Board of Directors, which is responsible for defining its policies, specialized regulations of general application, and internal rules; as well as establishing administrative, operational, and financial strategies of the Issuing Entity, approving their respective short and medium-term programs.
That subsections a), i), and o) of Article 54 of Law No. 1670 indicate as attributes of the Board of Directors of the BCB to issue regulations and adopt general decisions that are necessary for the Issuing Entity to fulfill the functions, competencies, and powers assigned by Law; to fix and regulate the administration of the Legal Reserve to which banks and other financial entities must be subject, disposing of measures for its compliance; as well as to approve, modify, and interpret the Statute and Regulations of the BCB by two-thirds of the votes of all its members, without the need for an additional administrative act.
That items 1) and 7) of Article 10 of the BCB Statute determine that the Board of Directors of the Issuing Entity has the attributes to approve general decisions and issue regulations that are necessary for the BCB to fulfill the functions, competencies, and powers assigned to it by Law; to establish by absolute majority of votes, Legal Reserves of mandatory compliance by Financial Intermediation Entities and to approve their composition, amount, calculation, characteristics, forms of administration, custody, and remuneration, according to Regulation.
That the Financial Entities Management and the Economic Policy Advisory, through Report BCB-GEF-INF-2023-8, conclude and recommend to the Board of Directors of the BCB the approval of the financial conditions for Liquidity Credits in the Framework of the Resolution Procedure of Banco Fassil S.A. under intervention.
That the Legal Affairs Management, through Report BCB-GAL-SANO-DLBCI-INF-2023-159, concludes that the proposal of the Economic Policy Advisory and the Financial Entities Management is legally viable, as it does not contravene the legal order, recommending to the Board of Directors of the Issuing Entity its approval.
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The interest rate shall be 2% (two percent) annually on the credit balance.
Liquidity credits in national currency shall be granted with a term of up to 1,080 (one thousand eighty) days, renewable up to one time.
La Paz, May 12, 2023
SIGNED. ROGER EDWIN ROJAS ULO, Gabriel Herbas Camacho, Gumercindo Héctor Pino Guzmán, Diego Alejandro Pérez Cueto Eulert.
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