BOARD OF DIRECTORS

BOARD RESOLUTION NO. 112/2024

SUBJECT: TREASURY MANAGEMENT – AUTHORIZE MONETIZATION OF CURRENCY MATERIAL FROM Bs100 AND Bs200 CUTS.

VIEWED:

• The Political Constitution of the State of February 7, 2009.
• Law No. 901 of November 28, 1986, on the Creation of a New Monetary Unit.
• Law No. 1670 of October 31, 1995, of the Central Bank of Bolivia (BCB) and its modifications.
• The BCB Statute, approved by Board Resolution No. 095/2022 of October 6, 2022.
• Board Resolution No. 094/2018 of July 24, 2018, and its modifications, which approve the Regulation on Monetization, Distribution, and Destruction of Currency Material and Destruction of Counterfeit Material.
• Board Resolution No. 067/2023 of May 2, 2023, which approves the Regulation on Exchange and Fractionation of Currency Material of the BCB.
• Contract SANO - DLABS No. 201/2023 of September 8, 2023, and its modification.
• Report BCB-GTES-SAMM-DAMM-INF-2024-93 of August 30, 2024, issued by the Treasury Management (GTES).
• Legal Report BCB-GAL-SANO-DLBCI-INF-2024-372 of August 30, 2024, issued by the Legal Affairs Management (GAL).

CONSIDERING:

That Article 327 of the Political Constitution of the State determines that the BCB is a public law institution, with legal personality and its own assets. Within the framework

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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.

That numeral 4 of paragraph I of Article 328 of the Political Constitution of the State establishes that it is an attribute of the BCB, in coordination with the economic policy determined by the Executive Branch, to authorize the issuance of currency.

That Article 1 of Law No. 901 of November 28, 1986, establishes the creation of the Boliviano as a new unit of the monetary system of the Plurinational State of Bolivia through banknotes and coins that the BCB will issue and circulate with the quality of legal and mandatory tender.

That Article 1 of Law No. 1670 establishes that the Issuing Entity is the sole monetary authority of the country, with administrative, technical, and financial competence and specialized regulatory powers.

That Articles 10 and 11 of Law No. 1670 provide that the BCB will exercise exclusively and inalienably the function of issuing the monetary unit of Bolivia called the "Boliviano," in the form of banknotes and metallic coins, and that the banknotes and coins issued by the BCB are means of payment with legal tender throughout the territory of the Plurinational State of Bolivia, with unlimited liberatory power.

That Article 44 of Law No. 1670 provides that the highest authority of the BCB is its Board of Directors, responsible for defining its policies, specialized regulations of general application, and internal rules; as well as for establishing administrative, operational, and financial strategies of the BCB.

That subsections a) and m) of Article 54 of the aforementioned Law determine that the BCB Board of Directors has the attribute to issue regulations and adopt general decisions that are necessary for the BCB to fulfill the functions, competencies, and powers assigned to it by the Law, and to authorize and supervise the printing, issuance, and destruction of banknotes and the minting and withdrawal of coins, within the norms of this Law.

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That numerales 1) and 11) of Article 10 of the BCB Statute provide that the BCB Board of Directors has the attribute to approve general decisions and issue regulations that are necessary for the BCB to fulfill the functions, competencies, and powers assigned to it by the Law, as well as to approve the printing, issuance, and destruction of Boliviano banknotes and coins, and those issued for commemorative and numismatic purposes as well as their denominations, dimensions, designs, and colors, in accordance with Regulations when applicable.

That Article 24 of the aforementioned Statute provides that resolutions and decisions of the Board of Directors are adopted by a simple majority of votes of the members present at the meeting, except in cases where Law No. 1670 or this Statute require qualified majorities.

That Article 26 of the Statute states that the Board of Directors pronounces itself on matters within its competence through Resolutions. It may also do so through decisions that will be expressly recorded in the Minutes. Every draft Board Resolution must be motivated and justified by a technical report from the Management or Managements to which the subject matter of the Resolution corresponds and by a report from the GAL. These reports must be submitted to the Board of Directors by the General Management with its recommendation.

That Articles 1 and 3 of the Regulation on Monetization, Distribution, Destruction of Currency Material, and Destruction of Counterfeit Material determine that its object is to regulate the monetization, distribution, demonetization, destruction of currency material, and destruction of counterfeit banknotes seized by Financial Intermediation Entities and submitted to the BCB. It also establishes that the BCB Board of Directors, through an express Resolution, will authorize the monetization of currency material based on reports from GTES and GAL, in function of the issuance or storage requirements determined by GTES.

That Articles 4 and 5 of the aforementioned Regulation determine that the authorization of monetization will be recorded in Minutes signed by a Director designated by the BCB Board of Directors, the General Manager, the Treasury Manager, and the Deputy Manager of Currency Material Operations. The Treasury Management will record the monetization of banknotes and coins, transferring accounting the nominal value of each of the denominations of "Currency Material in Warehouses" to the "Central Vault" account.

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That the Regulation on Exchange and Fractionation of Currency Material of the BCB has the object of regulating the exchange and fractionation operations of Boliviano banknotes and/or coins that must be carried out by all financial intermediation entities supervised by the Financial System Supervision Authority.

That the technical report BCB-GTES-SAMM-DAMM-INF-2024-93, from GTES, concludes that with the purpose of satisfying the projected demand of financial intermediation entities to respond to the population's fractionation needs and, in general, to meet issuance requirements, in conformity with current regulations, the monetization of larger cut banknotes is required. For this effect, the currency material to be used will correspond to pieces of banknotes from the new family of banknotes, amounting to 11.4 million pieces of the Bs200 cut (Bs2.28 billion). 42.4 million pieces of the Bs100 cut (Bs4.24 billion). It also recommends that, within the framework of Article 3 of the Regulation on Monetization, Distribution, Destruction of Currency Material, and Destruction of Counterfeit Material, the aforementioned monetization be authorized and a member of the Board of Directors be designated to participate in the monetization act.

That the legal report BCB-GAL-SANO-DLBCI-INF-2024-372, from GAL, concludes that the request of GTES through the Technical Report on monetization of 11.4 million pieces of the Bs200 cut (equivalent to Bs2.28 billion) and 42.4 million pieces of the Bs100 cut (equivalent to Bs4.24 billion), is legally appropriate by virtue of the legal provisions contained in the Political Constitution of the State, Articles 1 and 3 of Law No. 901, Law No. 1670, and the BCB Statute; likewise, in observance of what is provided in Articles 3 and 4 of the Regulation on Monetization, Distribution, Destruction of Currency Material, and Destruction of Counterfeit Material, it corresponds to the BCB Board of Directors to authorize the monetization of banknotes by a simple majority of votes of the members present, in conformity with paragraph I of Article 24 and Article 26 of the BCB Statute. Finally, in the exercise of the supervision attribute, it corresponds to the BCB Board of Directors to designate one of its members to participate in the corresponding monetization act.

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THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Authorize the monetization of banknotes in the Bs100 and Bs200 cuts, according to the following detail:

Cut	Quantity (Pieces)	Amount (Bs)
Bs200	11,400,000	2,280,000,000
Bs100	42,400,000	4,240,000,000

Article 2.- Designate Acting Director Gumercindo Héctor Pino Guzmán to represent the Board of Directors and participate in the monetization act of the aforementioned material.

Article 3.- The Presidency and General Management are charged with the compliance of this Resolution.

La Paz, September 3, 2024.

SIGNED. ROGER EDWIN ROJAS ULO, Oscar Ferrufino Morro, Gabriel Herbas Camacho, Gumercindo Héctor Pino Guzmán, Diego Alejandro Pérez Cueto Eulert.