Circular CONAU 1 - 963: Distribution of Results. Adjustments.

"2012 – Year of Homage to Dr. D. Manuel Belgrano" COMMUNICATION “A” 5273 27/01/2012 TO FINANCIAL ENTITIES:
Ref.: Circular
CONAU 1 - 963
Distribution of Results. Adjustments.

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We address you to inform you that this Institution adopted the following resolution:

“1. Replace the first paragraph of point 2.1. of the rules on "Distribution of results" with the following:

“Entities not included in any of the situations foreseen in point 1.1. may distribute results up to the positive amount that arises extracountably, from the sum of the balances at the close of the annual period to which they correspond, recorded in the account “Unassigned Results” (code 450000) and the discretionary reserve for future distribution of results, from which the amounts of the legal and statutory reserves -whose constitution is mandatory- must be deducted, and then those corresponding to the concepts -registered at the same date- detailed below:

2. Replace the last paragraph of point 2.2. of the rules on "Distribution of results" with the following:

“Without prejudice to what is established above, in no case shall the distribution of results be admitted while:

• the integration of minimum cash on average -in pesos, in foreign currency or in public securities- was less than the requirement corresponding to the last closed position or the projected considering the effect of the distribution of results, and/or
• the integration of minimum capital was less than the requirement recalculated above,
  increased by 75 %, and/or
• it registers financial assistance for illiquidity from the Central Bank of the Republic of Argentina,
  in the framework of article 17 of the Organic Charter of this Institution.
  For the case of financial entities that are branches of foreign entities, the Superintendence of Financial and Exchange Entities will take into account, in addition, the liquidity and solvency situation of their parent houses and of the markets in which they operate.”

Likewise, we send you attached the sheets that, in replacement of those previously provided, must replace the norms on "Distribution of results". Finally, it is recalled that on this Institution's website www.bcra.gov.ar, accessing "regulations" ("ordered texts"), the modifications made will be found with texts highlighted in special characters (strikethrough and bold).

We salute you attentively.
CENTRAL BANK OF THE REPUBLIC OF ARGENTINA
Darío C. Stefanelli Alfredo A. Besio
Main Manager of Emission and Normative Queries General Deputy Manager of Norms

ANNEX

2.1. Determination of distributable result.
Entities not included in any of the situations foreseen in point 1.1. may distribute results up to the positive amount that arises extracountably, from the sum of the balances at the close of the annual period to which they correspond, recorded in the account “Unassigned Results” (code 450000) and the discretionary reserve for future distribution of results, from which the amounts of the legal and statutory reserves -whose constitution is mandatory- must be deducted, and then those corresponding to the concepts -registered at the same date- detailed below:

2.1.1. the balances in concept of activation of differences resulting from payments made in compliance with judicial measures originating in cases in which the current applicable regulation to the “pesified” deposits is questioned, regardless of whether or not the granting of new long-term loans is registered, as referred to in the resolution disseminated by Communication “A” 4439.

2.1.2. the net positive difference resulting between the book values and the market quotation values, in the case that the financial entity registers public debt instruments and/or monetary regulation instruments of the Central Bank not valued at market prices, which have volatility published by the Central Bank.
When the public debt instrument is listed in the list of present values published by the Central Bank, for the purposes of the comparison indicated, the respective present value will be used. For the case of public titles and monetary regulation instruments of the Central Bank, which are not listed in the volatility or present value lists published by this Institution, said value must be calculated by the financial entities, based on the corresponding cash flow discounted at the internal rate of return of instruments of similar characteristics and “duration” that have volatility published by this Institution or, in default, using a yield rate that is consistent with the methodology provided in Section 4. of the norms on “Valuation of debt instruments of the non-financial public sector and monetary regulation of the Central Bank of the Republic of Argentina”.

Likewise, the criteria indicated above will be applied for the determination of valuation differences in participation certificates and debt titles of financial trusts, in the proportion that corresponds, when their underlying is constituted by the aforementioned instruments not valued at market price.

2.1.3. the asset valuation adjustments notified by the Superintendence of Financial and Exchange Entities -accepted or not by the entity- that are pending registration and/or those indicated by the external audit that have not been registered accountably.

DISTRIBUTION OF RESULTS
B.C.R.A.
Section 2. General procedure.
Version: 10a. COMMUNICATION “A” 5273
Validity:
27/01/2012

2.2.3.3. adjustments made according to points 2.1.1. to 2.1.4.
Without prejudice to what is established above, in no case shall the distribution of results be admitted while:

• the integration of minimum cash on average -in pesos, in foreign currency or in public securities- was less than the requirement corresponding to the last closed position or the projected considering the effect of the distribution of results, and/or
• the integration of minimum capital was less than the requirement recalculated above,
  increased by 75 %, and/or
• it registers financial assistance for illiquidity from the Central Bank of the Republic of Argentina,
  in the framework of article 17 of the Organic Charter of this Institution.
  For the case of financial entities that are branches of foreign entities, the Superintendence of Financial and Exchange Entities will take into account, in addition, the liquidity and solvency situation of their parent houses and of the markets in which they operate

2.3. Authorization.
Express authorization from the Superintendence of Financial and Exchange Entities must be obtained, whose intervention will have the object of verifying the correct application of the procedure. The request must be made, at minimum, with an advance of 30 business days of the holding of the shareholders' assembly or equivalent corporate body, which will consider the distribution of results.

DISTRIBUTION OF RESULTS
B.C.R.A.
Section 2. General procedure.
Version: 4a. COMMUNICATION “A” 5273
Validity:
27/01/2012

ORDERED TEXT ORIGIN OF THE NORM OBSERVATIONS
Sec. Point Para. Com. Annex Ch. Sec. Point Para.
1.1. “A” 4589 1.
1.1.1. “A” 4589 1.1.
1.1.2. “A” 4589 1.2. According to Com. “A” 4591
(point 6.) and 5072.
1.1.3. “A” 4589 1.3.
1.
1.1.4. “A” 4589 1.4. According to Com. “A” 5072.
2.1. “A” 4589 2. According to Com. “A” 4591
(point 6.), and 5273.
2.1.1. “A” 4589 2.1.
2.1.2. 1° “A” 4589 2.2. 1° According to Com. “A” 4698,
4898, 4976, 5072 and “B”
9186.
2° “A” 4589 2.2. 2° According to Com. “A” 4591 (point 7.), 4664, 4898 and 4976.
3° “A” 4898 According to Com. “A” 4976,
5072 and 5180.
4º “A” 4589 2.2. 3°
2.1.3. “A” 4589 2.3.
2.1.4. “A” 4589 2.4.
2.1.5. “A” 4686 3.
2.1.6. “A” 4702 4. According to Com. “A” 5180.
2.2. “A” 4589 3. According to Com. “A” 4591
(point 8.), 5072, 5273 and
“B” 9104.
2.2.1. “A” 4589 3.1. According to Com. “A” 4591
(point 8.).
2.2.2. “A” 4589 3.3. iv) According to Com. “A” 4591
(point 8.) and “B” 9104.
2.2.3. “A” 4589 3.3. According to Com. “A” 4591
(point 8.).
2.
2.3. “A” 4589 4.
3.1. “A” 4591 1.
3.1.1. “A” 4591 1. Incorporates the interpretative criterion of the Com.
“C” 46841.
3.
3.1.2. “A” 4591 1. According to Com. “A” 4686,
4702, 5072, 5180 and “B”
9104.
B.C.R.A.
ORIGIN OF THE PROVISIONS INCLUDED IN THE ORDERED TEXT OF THE NORMS ON “DISTRIBUTION OF RESULTS”