Circular 36/2008 — Modifies Circular 30/2008

"2008, Year of Physical Education and Sport"
CIRCULAR 36/2008
Mexico, D.F., August 1, 2008.
TO CREDIT INSTITUTIONS:
SUBJECT: MONETARY REGULATION DEPOSITS

The Bank of Mexico, based on Articles 28 of the Political Constitution of the United Mexican States, sixth and seventh paragraphs; 14, 24, and 28 of the Bank of Mexico Law; 22 of the Law for Transparency and Ordering of Financial Services; 8th paragraphs third and sixth, 10, 17 section I, and 19 section IX of the Internal Regulations of the Bank of Mexico, which provide for the attribution of the Central Bank, through the Directorate of Central Bank Regulations and the Directorate of Operations, respectively, to issue regulations; Unique of the Agreement on the Assignment of Administrative Units of the Bank of Mexico, sections I and IV, and with the objective of promoting the sound development of the financial system and promoting the adequate compliance with the procedure for the termination of existing monetary regulation deposits and the constitution of new monetary regulation deposits, has resolved to modify sections 1., 2. first paragraph, 2.1, and 2.3, second and third paragraphs of Circular 30/2008, to read as follows:

1. PROCEDURE FOR THE TERMINATION OF EXISTING MONETARY REGULATION DEPOSITS

“The Bank of Mexico shall consider terminated the monetary regulation deposits that credit institutions have constituted in accordance with the provisions of Circular-Telefax 30/2002 of August 29, 2002, 10/2003 of March 28, 2003, 21/2004 of November 19, 2004, and 22/2005 of November 25, 2005. The aggregate balance of the principal of the aforementioned deposits currently amounts to $278,981,126,756.00 (TWO HUNDRED SEVENTY-EIGHT BILLION NINE HUNDRED EIGHTY-ONE MILLION ONE HUNDRED TWENTY-SIX THOUSAND SEVEN HUNDRED FIFTY-SIX PESOS 00/100 M.N.).

For this purpose, on the days August 21 and 28; September 4, 11, 18, and 25, as well as October 2 and 9, 2008, at the opening of operations of the Bank of Mexico Account Holder Service System (SIAC-BANXICO), the Bank of Mexico will make the necessary credits to the Single Account held for each credit institution, up to the amount of $34,872,640,844.50 (THIRTY-FOUR BILLION EIGHT HUNDRED SEVENTY-TWO MILLION SIX HUNDRED FORTY THOUSAND EIGHT HUNDRED FORTY-FOUR PESOS 50/100 M.N.) each day; considering the portion of the aforementioned deposits corresponding to each credit institution with respect to the aggregate principal amount. On the same dates, the amount for interest accrued on the deposits maintained during the last interest period will also be credited.

For the credits on August 21 and 28, as well as September 4 and 11, the last interest period will be counted from August 21, 2008, up to each of the mentioned dates. For the credits on September 18 and 25, as well as October 2 and 9, the last interest period will be counted from September 18 up to each respective date.

The interest accrued during this last period will be calculated by applying the rate resulting from the formula specified in the Circular-Telefax referred to in the first paragraph of this section, using the weighted banking funding rate that the Bank of Mexico obtains each banking business day, from the beginning of said interest period up to the day immediately preceding the payment dates mentioned in the previous paragraph.

Consequently, the deposits that are considered terminated: a) on August 28 and September 25 will accrue interest for seven days; b) on September 4 and October 2 will accrue interest for fourteen days; c) on September 11 and October 9 will accrue interest for twenty-one days; and d) on August 21 and September 18 will accrue interest for twenty-eight days.”

2. PROCEDURE FOR THE CONSTITUTION OF MONETARY REGULATION DEPOSITS

“Credit institutions are obligated to constitute monetary regulation deposits for a total amount of $280,000,000,000.00 (TWO HUNDRED EIGHTY BILLION PESOS 00/100 M.N.). From this sum, $35,000,000,000.00 (THIRTY-FIVE BILLION PESOS 00/100 M.N.) must be deposited weekly on the days August 21 and 28; September 4, 11, 18, and 25, as well as October 2 and 9, 2008.

. . .”

2.1 Amount

“The amount that each institution must deposit on the mentioned days will be the result obtained by distributing the indicated amounts pro rata based on the reference liabilities of the credit institutions as of May 31, 2008.

To this effect, reference liabilities shall be understood as the collection of resources in national currency and Investment Units (UDI’s), comprised in the following categories: (1) traditional collection; (2) outstanding subordinated obligations; (3) repo operations (creditor balance), and (4) interbank loans and loans from other entities. To arrive at reference liabilities, loans received from: (i) development banks (other than “Call”); (ii) public trusts; (iii) the Federal Government; (iv) operations as an agent of the Federal Government, and (v) other entities will be subtracted from category (4). All the aforementioned categories are obtained from the sub-report “R10 A 1011 Reclassifications in the Balance Sheet” (column: Bank Financial Statement without Consolidation) of the National Banking and Securities Commission, whose information was registered as of July 8, 2008, according to a query made by the Bank of Mexico itself on that same day, in the systems of said Commission.

The Bank of Mexico will inform each credit institution in writing of the amount corresponding to it as a result of the proration, which will be sent electronically no later than August 5 of the current year. Each credit institution must pick up the original copy corresponding to it no later than August 7 of the same year, at the Directorate of Financial System Information of the Bank of Mexico located at Avenida Cinco de Mayo Number 1, second floor, Guardiola building, Centro Neighborhood, Mexico City, D.F., C.P. 06059, with telephone number 5237.25.40.”

2.3 Yields

“. . .

The first interest period for deposits constituted between August 21 and September 11 will conclude on September 18, 2008; on the other hand, the first interest period for deposits constituted between September 18 and October 9 will conclude on October 16, 2008. The payment of interest for said first period will be carried out according to the following procedure, for deposits constituted:
a) on August 21 and September 18, 2008, interest will be paid for twenty-eight days; b) on August 28 and September 25, for twenty-one days; c) on September 4 and October 2, for fourteen days, and d) on September 11 and October 9, for seven days.

Interest will be paid to these institutions by credit to the Single Account held by the Institute itself at the close of said first period.

. . .”

TRANSITORY
SINGLE. This Circular shall enter into force on August 4, 2008.