Circular 17/2007 — Modifies Circular 2031/97 — BANXICO — MX

CIRCULAR 17/2007
Mexico, D.F., December 6, 2007.
TO THE CREDIT INSTITUTIONS OF THE COUNTRY:
SUBJECT: MODIFICATIONS TO THE OPERATING RULES OF THE RECIPROCAL PAYMENTS AND CREDITS AGREEMENT SIGNED BY THE BANK OF MEXICO AND THE CENTRAL BANKS OF THE OTHER MEMBER COUNTRIES OF THE LATIN AMERICAN INTEGRATION ASSOCIATION (ALADI) AND THE DOMINICAN REPUBLIC

The Bank of Mexico, based on Articles 28 of the Political Constitution of the United Mexican States, sixth and seventh paragraphs; 24 of the Bank of Mexico Law; 22 of the Law for Transparency and Orderly Regulation of Financial Services; as well as Articles 8, 10, 17 fraction I and 20 Bis fraction XII, which establish the authority of the Central Banking Regulations Directorate and the Operational Procedures Directorate, respectively, to participate in the issuance of provisions, all of the Internal Regulations of the Bank of Mexico published in the Official Gazette of the Federation on September 30, 1994, whose last modification was published in said Official Gazette on April 26, 2007; as well as in the Single Article, fractions I and IV of the Agreement on the Affiliation of the Administrative Units of the Bank of Mexico; with the objective of promoting the sound development of the financial system and considering that:

The Council for Financial and Monetary Affairs of "ALADI" in a meeting held on May 18, 2007, approved modifying the text of the Regulations of the "Agreement" in its article 18, with the objective of changing from 1 to 4 the number of digits that the Year field must have in the "Reimbursement Code", so it will be necessary to use 20 digits instead of 17, and
The need to modify the operations classified in the Bank of Mexico Account Holder Attention System (SIAC), through which this Central Bank is informed of issuance notices, reimbursement requests, and claim notices.

For the above, this Central Institute has resolved to modify Annex III, as well as add Annexes XIII, XIV and XV of the Operating Rules of the aforementioned Agreement contained in Circular 2031/97, under the following terms:

ANNEX III
CHARACTERISTICS AND NORMS OF THE SICAP/ALADI REIMBURSEMENT CODE

"For the routing of "Instruments" through the "Agreement", their identification via the "Reimbursement Code" is mandatory, which consists of sixteen digits plus four optional ones to be used in divisible operations and whose characteristics and application norms are developed below:

1.1 CONTENT OF THE FIELD DIGITS

Bank/Office Code 4
Instrument Type 1
Year of Issue 4
Sequence Number 6
Check Digit 1
Eventual Sequence (optional) 4

1.2 DESCRIPTION OF THE FIELDS
a) ... b) ... c) Year of Issue:

Refers to the year in which the reimbursement code is generated. d) ... e) Check Digit:
The check digit will be generated by the Modulo 10 calculation method, determined in each case by the "Authorized Mexican Institution" and will be calculated on the first fifteen digits of the code occupying position number sixteen. f) Eventual Sequence (optional):
This field will consist of four digits and will be used to indicate linked partial payments, identified by the same "Reimbursement Code". The responsibility for assigning this sequence will correspond to the issuing "Authorized Mexican Institution", when the "Instrument" provides for payment in installments of the amount indicated in it or, in its case, to the "Mexican Institution" reimbursing, when through it, it carries out the fragmentation of the payment of an operation."

...
2. IMPORTANCE OF THE CORRECT USE OF CODE NUMBERS, AS WELL AS THE CALCULATION OF THE VERIFIER DIGIT
...
CALCULATION OF MODULO 10

"The modulo 10 can be calculated for any number of 2 to 127 digits in length. For the calculation, the following is done:

Multiply by the factors 1,2,1,2,1,2,1,2,1,2,1,2,1,2,1 respectively each position of the number, starting from the first digit of the left extreme.
...
...
...

E X A M P L E
Basic number 756312765748159
Multipliers 121212121212121
(1) Multiplication 7,10,6,6,1,4,7,12,5,14,4,16,1,10,9 (2) Accumulation of digits 7,1,6,6,1,4,7,3,5,5,4,7,1,1,9 (3) Sum 7+1+6+6+1+4+7+3+5+5+4+7+1+1+9=67 (4) Next highest number ending in 0 70 Subtraction 70-67=3 Check digit 3

BANK "X"
GRAPHICAL EXAMPLE OF AN OPERATION WITH PAYMENT ORDER 5106 Code number assigned to Bank "X", according to the list of "Authorized Mexican Institutions". 4 Number of encoding that corresponds to payment order. 2008 Year in which the payment order was issued. 000001 Progressive number assigned by the issuing institution of the payment order. 3 Check digit calculated according to the modulo 10 method of the instruction.

Basic number 510642008000001
Multipliers 1212 1 2 121212121
(1) Multiplication 5 2 0 12 4 4 0 0 8 0 1
(2) Accumulation of digits 5 2 0 3 4 4 0 0 8 0 1
(3) Sum 5+2+0+3+4+4+0+0+8+0+0+0+0+0+1=27
(4) Next highest number ending in 0
30
Subtraction 30-27=3
Check digit 3

RECOMMENDATION
...
Any additional information on the matter will be provided by the Office of Procedures for Investments and Agreements of this "Bank", at Av. 5 de Mayo No. 6, or at phones 5227.8735 and 5227.8733."

"ANNEX XIII
INSTRUCTION FOR DATA ENTRY IN THE SIAC OF THE OPERATION "206029 ISSUANCE NOTICES" This operation will be used only by "Authorized Mexican Institutions", to present to the "Bank" the Issuance Notices that they wish to route through Agreements (ALADI and Malaysia), according to section 1.5 of Circular 2031/97. The registration of this operation is Same Day Value (SDV), so to capture this operation the following procedure must be followed:
1.- To enter the capture screen for this operation in the SIAC system, select the following options: Capture – Operation Entry – Manual – SDV - 206029. 2.- The "Issuance Notices Capture" screen is shown, in which the information corresponding to the operation(s) being processed is entered. (I) OFFICE This field is filled automatically with your CESIF key. (II) FOLIO Progressive number (daily), assigned as control to the "Instruments" captured by the "Authorized Mexican Institution". (III) REGISTRATION DATE This field is filled automatically with the date of the day on which the operation is captured. (IV) ALADI / MALAYSIA IDENTIFIER The options "A" and "M" are displayed. Choose the corresponding one, according to the following criterion:
A = Agreement with ALADI.
M = Agreement with Malaysia.
(V) EVENT TYPE
Type the following concepts, as appropriate to the action you wish to execute:
AVISO: When it is an issuance notice.

CANAVISO: In the event of a partial or total cancellation of an issuance notice, provided that the Latin American bank has not made the operation effective. (VI) FOREIGN CENTRAL BANK Press in the box and choose the name of the beneficiary "Central Bank" of the issuance notice that is reported to the "Bank", or type the key assigned to the "Central Bank", according to Annex I of Circular 2031/97. (VII) MEXICAN INSTITUTION This field is filled automatically with the code that was assigned to them by the Bank of Mexico at the time of requesting to be considered as "Authorized Mexican Institution", detailed in Annex IV of Circular 2031/97. (VIII) LATIN AMERICAN BANK Press in the box and choose the name of the beneficiary "Latin American Bank" of the issuance notice or consult Annex II of Circular 2031/97. (IX) DETAIL Number assigned automatically by the system. (X) INSTRUMENT Enter the key corresponding to the "Instrument" in question, according to the following nomenclature:
OP Payment Order OD Divisible Payment Order
GN Nominal Draft CC Letter of Credit
CD Documentary Credit LA Guaranteed Bill
PA Guaranteed Promissory Note PE Discounted Promissory Note (XI) REIMBURSEMENT CODE Capture the "Reimbursement Code" issued by the "Authorized Mexican Institution" itself, according to the procedure described in Annex III of Circular 2031/97, which must appear invariably in the "Instruments", immediately after the phrase: "Reimbursable through the Reciprocal Payments and Credits Agreement under Reimbursement Code Number___". In the case of LA, PA and PE, a reimbursement code will be issued for each of the maturities of the "Instrument". (XII) SHIPMENT DATE (Exclusively for CC, CD, and CG) Enter the maximum shipment date determined in the "Instrument", in format YYYYMMDD. In case it is not contracted, type the maturity date of the "Instrument". (XIII) ISSUANCE DATE Capture the issuance date determined in the "Instrument", in format YYYYMMDD. (XIV) NEGOTIATION TERM (Exclusively for CC and CD) Capture the negotiation term in number of days, which is established in the "Instrument". In the case of being payable at sight, capture 1. (XV) AMOUNT Capture the total value of the "Instrument".

(XVI) MATURITY DATE
Capture the maturity date determined in the "Instrument", in format YYYYMMDD.
(XVII) MERCHANDISE
Type the corresponding key, according to Annex IX of Circular 2031/97.
(XVIII) MERCHANDISE NAME.
Name assigned automatically by the system, this corresponds to the code typed in the previous point.
(XIX) OBSERVATIONS
Field in which any comment regarding the instrument being notified can be entered.
Once the complete information of the issued "Instrument" (or cancellation of issuance) is captured, press the [Accept] icon.
If you have a second instrument, continue with the capture of this one in folio number 2 and so on until finished.
At the end of the capture session, press the [Accept and Sign] icon.
CLARIFICATIONS

They must send to the email address convenios@banxico.org.mx, a copy of the issued "Instrument" and/or a copy of the modifications, as appropriate, that support the captured operations. Any additional clarification will be attended by the Office of Procedures for Investments and Agreements of this "Bank", at phones 5227.8735 and 5227.8733, or at the email address mentioned above."

"ANNEX XIV
INSTRUCTION FOR DATA ENTRY IN THE SIAC OF THE OPERATION "206269 REIMBURSEMENT REQUEST" This operation will be used to present to the "Bank" the Reimbursement Requests derived from agreement operations (ALADI and Malaysia), according to section 1.5 of Circular 2031/97. The registration of this operation is Same Day Value (SDV), so for the capture of this operation the following procedure must be followed:
1.- To enter the capture screen for this operation, in the SIAC system select the following options: Capture – Operation Entry – Manual – SDV - 206269. 2.- The "Reimbursement Requests Capture" screen is shown, in which the information corresponding to the operation(s) to be processed is entered. (I) OFFICE This field is filled automatically with your CESIF key. (II) FOLIO Progressive number (daily), assigned as control to the "Instruments" captured by the "Mexican Institution".

(III) REGISTRATION DATE
This field is filled automatically with the date of the day on which the operation is captured.
(IV) INSTRUMENT TYPE TERM / AT SIGHT
The options "V" and "P" are displayed. Choose the corresponding one, according to the following criterion:
V = Operations reimbursable in less than 180 days.
P = Operations reimbursable in more than 180 days.
(V) GROUP
The options "1" and "2" are displayed. Choose the corresponding one, according to the type of "Instrument", according to the following classification:
1 = Payment Order (OP); Divisible Payment Order (OD) and Nominal Draft (GN).
2 = Letter of Credit (CC); Documentary Credit (CD); Letter of Credit Interest (CCI); Documentary Credit Interest (CDI); Commissions and Expenses (CG); Guaranteed Bill (LA); Guaranteed Bill Interest (LAI); Guaranteed Promissory Note (PA); Guaranteed Promissory Note Interest (PAI); Discounted Promissory Note (PE), and Discounted Promissory Note Interest (PEI). (VI) EVENT TYPE Type the following concepts, as appropriate to the action you wish to execute:
ASOLIC: When it is a reimbursement request.
CANSOLIC: In the event of a partial or total cancellation of a previous reimbursement request, provided that both events, request and cancellation, occur within the same quadrimester period (January-April, May-August or September-December). (VII) FOREIGN CENTRAL BANK

Press in the box and choose the name of the "Central Bank" that grants the reimbursement guarantee of the operation that is reported to the Bank of Mexico, or type the key assigned to the "Central Bank", the detail is found in Annex I of Circular 2031/97. (VIII) MEXICAN INSTITUTION This field is filled automatically with the code that was assigned to them by the "Bank", at the time of requesting to be considered as "Authorized Mexican Institution". In the case of not being authorized by the "Bank", code 5108 will appear. (IX) INSTRUMENT Enter the key corresponding to the "Instrument" in question, according to the nomenclature detailed below:
Payment Order (OP); Divisible Payment Order (OD); Nominal Draft (GN); Letter of Credit (CC); Documentary Credit (CD); Letter of Credit Interest (CCI); Documentary Credit Interest (CDI); Commissions and Expenses (CG); Guaranteed Bill (LA); Guaranteed Bill Interest (LAI); Guaranteed Promissory Note (PA); Guaranteed Promissory Note Interest (PAI); Discounted Promissory Note (PE) and Discounted Promissory Note Interest (PEI). (X) REIMBURSEMENT CODE Capture the "Reimbursement Code" assigned by the "Latin American Banks", which must appear invariably in the "Instruments", immediately after the phrase: "Reimbursable through the Reciprocal Payments and Credits Agreement under Reimbursement Code Number___". (XI) SEQUENCE (Exclusively for those "Instruments" that are reimbursed in several installments) Consecutive number of four digits, determined and controlled by the "Mexican Institution" or the "Authorized Mexican Institution"

(XII) SHIPMENT DATE (Exclusively for CC, CD, and CG) Enter the date determined in the corresponding shipping document, in format YYYYMMDD.
(XIII) ISSUANCE DATE
Capture the date on which the "Latin American Bank" issued the "Instrument", in format YYYYMMDD.
(XIV) NEGOTIATION TERM (Exclusively for CC, CD, and CG) Capture the negotiation term established in the "Instrument" in number of days. In the case of being payable at sight capture 1. (XV) AMOUNT Capture the value, total or partial, of the "Instrument", as appropriate. (XVI) OBSERVATIONS Field in which any comment regarding the instrument being reimbursed can be entered. If you have a second "Instrument", continue with the capture of this one in folio number 2 and so on until finished. Once the information of the "Instrument assigned to a certain folio is captured, press the [Accept] icon. At the end of the capture session, press the [Accept and Sign] icon. CLARIFICATIONS

They must send to the email address convenios@banxico.org.mx, a copy of the "Instrument", modifications and shipping documents that support the captured operations. Any additional clarification will be attended by the Office of Procedures for Investments and Agreements of this "Bank", at phones 5227.8735 and 5227.8733, or at the email address mentioned above."

"ANNEX XV
INSTRUCTION FOR DATA ENTRY IN THE SIAC OF THE OPERATION "206408 CLAIM NOTICES" This operation will be used to present to the "Bank" the Claim Notices derived from operations of the agreement established with ALADI, according to section 1.5 of Circular 2031/97 issued by the "Bank" itself. This operation must be entered into the SIAC prior to the presentation to the "Bank" of the Reimbursement Request with the following procedure:
1.- Within the SIAC system select the following options: Capture – Operation Entry – Manual SDV - 206408 2.- The Capture – Claim Notices screen is shown, in which the corresponding details of the operation(s) to be reported are entered. (I) OFFICE This field is filled automatically with your CESIF key. (II) FOLIO Progressive number (daily), assigned by the "Mexican Institution" for control of the operations entered into the SIAC. (III) REGISTRATION DATE

This field is filled automatically with the date of the day on which the operation is captured.
(IV) AGREEMENT COUNTRY KEY
Choose the name of the "Central Bank" in charge of which the Claims to be reported to the "Bank" correspond, or type the key assigned to the "Central Bank", detailed in Annex I of Circular 2031/97. (V) MEXICAN INSTITUTION This field is filled automatically with the code that was assigned to them by the "Bank" at the time of being considered as "Authorized Mexican Institution". In the case of not being authorized by the "Bank", code 5108 will appear. (VI) INSTRUMENT Enter the reference corresponding to the "Instrument" in question, according to the following nomenclature:
OP Payment Order OD Divisible Payment Order
GN Nominal Draft CC Letter of Credit
CD Documentary Credit LA Guaranteed Bill
LAI Guaranteed Bill Interest PA Guaranteed Promissory Note PAI Guaranteed Promissory Note Interest PE Discounted Promissory Note PEI Discounted Promissory Note Interest (VII) MOVEMENT TYPE Capture the key of the type of movement, according to the event that is reported to the "Bank", based on the following nomenclature:
E Issuance N Negotiation
C Cancellation M/E Issuance Modification
M/N Negotiation Modification
(VIII) REIMBURSEMENT CODE
Capture the "Reimbursement Code" assigned and reported by the "Latin American Banks", which must appear invariably in the "Instruments", immediately after the phrase: "Reimbursable through the Reciprocal Payments and Credits Agreement under Reimbursement Code Number ___". (IX) SEQUENCE (Exclusively for those "Instruments" that are reimbursed in several installments) Consecutive number of four digits, determined and controlled by the "Mexican Institution" or the "Authorized Mexican Institution". (X) ISSUANCE DATE Capture the date on which the "Latin American Banks" issued the "Instrument", in format YYYYMMDD. In the case of OP and OD that have been revalidated, the issuance date will be that of revalidation. (XI) MATURITY DATE (Only for "E" and "M/E" in case the maturity date is modified)

Capture the maturity date determined in the "Instrument", in format YYYYMMDD, except for OP, OD and GN, for whom it will be 90 days from the date of issuance. (XII) AMOUNT Capture the value, total or partial, of the "Instrument", as appropriate to the type of movement that is reported to the "Bank". (XIII) REIMBURSEMENT DATE (Only for "N" and "M/N" in case the reimbursement date is modified) Capture the date on which the Claim is intended to be made effective, that is, the date on which the Reimbursement Request will be presented, except for OP, OD and GN. Once the information of the Claim Notices of the "Instrument" is captured, press the [Accept] icon. If you have a second notice, continue with the capture of this one in folio number 2 and so on until finished. At the end of the capture session, press the [Accept and Sign] icon. CLARIFICATIONS Any additional clarification will be attended by the Office of Procedures for Investments and Agreements of this "Bank", at phones 5227.8735 and 5227.8733 or at the email address convenios@banxico.org.mx."

TRANSITIONAL PROVISIONS
FIRST. This Circular will enter into force on January 2, 2008.
SECOND. The reimbursement codes issued before the date mentioned in the previous paragraph will retain their structure of one digit in the "Year" field and when reference is made to them, only seventeen positions must be used.

Lineage: No known changes