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2026-04-17

STANDARD ON THE MANAGEMENT OF INVESTMENTS OF SAVINGS AND CREDIT COOPERATIVES (CEC)

Issued by the Banque de la République d’Haïti (BRH), this standard mandates Savings and Credit Cooperatives (CECs) to strictly limit investment risk exposure by capping total investments at 70% of equity, prohibiting holdings in foreign entities and stock-exchange-traded shares, and requiring mandatory impairment provisioning for durable value declines. It establishes a one-year transitional period for non-compliant portfolios, enforces semi-annual portfolio reporting to the central bank, and dictates specific accounting treatments for impairment provisions. Violations, including failure to restore impaired provisions or exceed investment thresholds, trigger administrative sanctions under Articles 139 and 140 of the June 26, 2002 Law, which must be formally addressed during the CEC’s annual general meeting.

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Bank of the Republic of Haiti (BRH) 7 STANDARD ON THE MANAGEMENT OF INVESTMENTS OF SAVINGS AND CREDIT COOPERATIVES (CEC) Pursuant to Article 14 of the Law of June 26, 2002 on Savings and Credit Cooperatives, CECs must comply with the following provisions regarding limits governing investment risk management.

  1. Definitions Investments concern the purchase of equity or debt securities. They do not include time deposits made in financial institutions. Depending on their nature and the period for which the company intends to hold them, investments may be short-term or long-term. If a CEC's investment in another company aims to control said company or gives rise to significant business relationships, the investment will be classified as a long-term investment regardless of its duration.

1.1 Investment Risks Investment risk refers to the probability of financial losses resulting from a negative change in the value of an investment (on-balance sheet and off-balance sheet) and the default of a counterparty. Investment risks encompass the following asset items (on-balance sheet and off-balance sheet): • Equity securities (shares and capital participation in a company); • Debt securities (bonds); • Other securities. Investment risks exclude receivables from the BRH

1.2 Provision for Impairment - Investments and Securities If a loss in value is identified in investments and this decline in value is durable (at least three (3) consecutive years), a provision must be created to bring the investments to their net realizable value. In the case of short-term investments, they must be revalued at each fiscal year-end. The CEC may reverse the effects of a previously recognized loss in value, but the recognized gain must in no case result in the securities having a book value exceeding their acquisition cost.

  1. Limitation of Investments Limitation ratios aim to restrict the use of the cooperative's funds for investment purposes.

2.1 Limitation of Total Investments: The total amount of investments must not exceed the following standard: In no case shall investments exceed 70% of equity ! " ! !"#A% &'("*)+#

Bank of the Republic of Haiti (BRH) 8 2.2 Limitation of Investments in a Single Company The maximum amount of investments in a single company must not exceed the following standard: 2.3 Prohibition of Certain Investments A CEC cannot acquire or hold the following type of investment: • More than 25% of the share capital of a local company • Shares traded on the stock exchange • Investments in a foreign company

  1. Transitional Provisions From the publication of this document, the BRH grants a period of one (1) year to CECs that currently hold prohibited investments to dispose of them and comply with this standard.

  2. Accounting for Provisions for Impairment - Investments and Securities When establishing or reversing provisions, the line items "provision for impairment - Investments and securities" in the income statement and "provisions for impairment - Investments and securities" in the balance sheet must be used.

  3. Semi-Annual Report on Investment and Securities Portfolio CECs must complete and submit to the BRH a report on the investment and securities portfolio according to the table attached to this circular.

  4. Sanctions Misvaluation of Investments and Securities If a CEC fails to restore, within the timeframe required by the BRH, the level of its provision for impairment - investments and securities created following a misvaluation, the BRH reserves the right to apply administrative sanctions against the CEC in accordance with Articles 139 and 140 of the Law of June 26, 2002. Exceeding the Standard If a CEC exceeds the investment limits set by this circular, the BRH reserves the right to apply administrative sanctions against the CEC in accordance with Articles 139 and 140 of the Law of June 26, 2002. ! " ! !"#A% /+.")0),# -.,& ,) &)+) &'"A(#(

Bank of the Republic of Haiti (BRH) 9 Other Offenses For all other violations of this circular, the BRH reserves the right to apply administrative sanctions against the CEC in accordance with Articles 139 and 140 of the Law of June 26, 2002. Administrative sanctions imposed by the BRH must be addressed during the CEC's annual general meeting, pursuant to Article 43(g) of the Law of June 26, 2002.

  1. Entry into Force of this Circular The provisions of this circular enter into force on _______________________ Port-au-Prince, on ___________________ 2008 Charles CASTEL Governor

Bank of the Republic of Haiti (BRH) 10 ANNEX NAME OF THE CEC:_________________________________________________ STATUS AS OF:_____________________________________ FREQUENCY: SEMI-ANNUAL INFORMATION ON THE INVESTMENT AND SECURITIES PORTFOLIO

CompanyInvestmentCalculated RatiosStandardsVariance
NameLocationCapitalTotal
Authorized Signature________________________________________ Date: ___________________________
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