Central Bank of Bolivia

Board of Directors

BOARD RESOLUTION NO. 084/2017

SUBJECT: INTERNATIONAL OPERATIONS MANAGEMENT – APPROVES MODIFICATION TO THE REGULATION FOR THE ADMINISTRATION OF INTERNATIONAL RESERVES.

VISTOS:

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).

The Statute of the BCB approved by Board Resolution No. 128/2005 of October 21, 2005, and its subsequent modifications.

The Regulation for the Administration of International Reserves approved by Board Resolution No. 122/2016 of July 5, 2016.

The Report of the International Operations Management BCB-GOI-SRES-DNI-INF-2017-15 of June 22, 2017.

The Report of the Legal Affairs Management BCB-GAL-SANO-DLBCI-INF-2017-151 of June 23, 2017.

CONSIDERING:

That the Political Constitution of the State establishes in its article 328 that it is an attribution 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 its functions and for their adequate safeguarding and security.

That within the framework of the aforementioned, the Issuing Entity has approved through Board Resolution No. 122/2016 the Regulation for the Administration of International Reserves, establishing the policies and norms for its correct administration.

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That the Report of the International Operations Management BCB-GOI-SRES-DNI-INF-2017-15, recommends approving the modifications to the Regulation for the Administration of International Reserves.

That the Report of the Legal Affairs Management BCB-GAL-SANO-DLBCI-INF-2017-151 concludes that the project of Modifications to the Regulation for the Administration of International Reserves proposed by the GOI is legally appropriate, since it does not contravene the current legal framework, being the competence of the Board of Directors of the BCB to consider its approval by two-thirds of the votes of all its members in accordance with what is established in subsection o) of article 54 of Law No. 1670 and numeral 29 of article 11 of the Statute of the BCB.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Modify article 10 of the Regulation for the administration of international reserves as follows:

IT SAYS.

Article 10.- (Investment Tranche)

III. It is constituted by the Portfolios: Medium Term 0-5 years, Global (in the currencies authorized by the Board), TIPS (Treasury Inflation Protected Securities) and holdings of Special Drawing Rights. This tranche is invested in the instruments and operations indicated in article 13 of this Regulation.

IT MUST SAY

“Article 10.- (Investment Tranche)

III. It is constituted by the Portfolios: Medium Term 0-5 years, Global (in the currencies authorized by the Board) and holdings of Special Drawing Rights. This tranche is invested in the instruments and operations indicated in article 13 of this Regulation.”

Article 2.- Modify article 12 of the Regulation for the administration of international reserves as follows:

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IT SAYS

Article 12.- (Reference Comparators)

Tranche	Portfolio	Reference Comparator (Benchmark)
Precautionary	Working Capital	LIBID Overnight average in USD
	0-3 years Portfolio	Merrill Lynch US Treasuries Index 0 to 3 years
	Liquidity Portfolio	LIBID 6 months average in USD
Investment	Medium term 0-5 years	MTI BIS Bonds 0-5 years
	TIPS	Barclays Capital US Govt. Inflation-linked Bond Index, 1-10 years
	Global(1)	Merrill Lynch Index Bonds 0-5 years AAA in EUR(EGAV), FIXBIS 6 months in AUD, FIXBIS 6 months in CAD, 6 months deposit index in CNH and Merrill Lynch Index of Chinese Government Bonds 1-10 years in CNY

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

IT MUST SAY

“Tranche	Portfolio	Reference Comparator (Benchmark)
Precautionary	Working Capital	LIBID Overnight average in USD
	0-3 years Portfolio	Merrill Lynch US Treasuries Index 0 to 3 years
	Liquidity Portfolio	LIBID 6 months average in USD
Investment	Medium term 0-5 years	MTI BIS Bonds 0-5 years
	Global(1)	Merrill Lynch Index Bonds 0-5 years AAA in EUR(EGAV), FIXBIS 6 months in AUD, FIXBIS 6 months in CAD, 6 months deposit index in CNH and Merrill Lynch Index of Chinese Government Bonds 1-10 years in CNY

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

Article 3.- Eliminate paragraph V of article 16 of the Regulation for the administration of international reserves.

Article 4.- These modifications enter into force on the date of issuance of this Board Resolution.

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Article 5.- The Presidency and General Management are charged with the compliance of this Resolution.

La Paz, June 27, 2017

Pablo Ramos Sánchez
Luis Baudoin Olea
Ronald Polo Rivero
Abraham Pérez Alandia
Sergio Velarde Vera