Circular Letter No. 2.359

CIRCULAR LETTER No. 002359 ------------------------ CLARIFIES REGARDING THE INFORMATION REQUIRED BY CIRCULAR No. 2.292. IN VIEW OF DOUBTS RAISED BY THE FINANCIAL MARKET REGARDING THE INFORMATION REQUIRED BY CIRCULAR No. 2.292, OF 24.03.93, WE CLARIFY THAT: I - THE INFORMATION TO BE PROVIDED DAILY TO THE CENTRAL BANK IS THE AVERAGE RATE AND THE TOTAL VOLUME OF FUNDS EFFECTIVELY INVESTED ON THE DAY, IN EACH MODALITY, AS PER THE "CAPUT" OF ART. 1 OF THE AFOREMENTIONED CIRCULAR. II - THE "EFFECTIVE-DAY" RATES MUST BE DETERMINED BASED ON THE COST OF OPERATIONS FOR THE FUND BORROWERS, AS EXEMPLIFIED BELOW: A - OPERATION: DISCOUNT OF DUPLICATES - VALUE OF THE TITLE: 100 MILLION - DATE OF OPERATION: 12.04.93 - MATURITY: 12.05.93 - BUSINESS DAYS IN THE PERIOD: 21 - NOMINAL DISCOUNT RATE IN THE PERIOD: 25% - VALUE MADE AVAILABLE TO THE BORROWER: 75 MILLION - EFFECTIVE RATE IN THE PERIOD: 33.33% 1/21 - EFFECTIVE-DAY RATE: 100((1.333) -1) = 1.3792% B - OPERATION: FINANCING FOR ACQUISITION OF GOODS - VALUE OF THE GOOD: 13 MILLION - FINANCED VALUE: 10 MILLION - FINANCING TERM: 3 MONTHS - RATE: 30% P.M. 3 - RATE IN THE PERIOD: 100((1.3) -1) = 119.70% - BUSINESS DAYS IN THE PERIOD: 63 1/63 - EFFECTIVE-DAY RATE: 100((2.197) -1) = 1.2572% C - OPERATION: OVERDRAFT - DEBIT BALANCE ON THE DAY: 10 MILLION - INTEREST ACCRUED ON THE DAY: 130 THOUSAND - EFFECTIVE-DAY RATE = 1.3% III - THE AVERAGE RATE MUST BE CALCULATED BY WEIGHTING THE EFFECTIVE-DAY RATE OF EACH OPERATION BY ITS EFFECTIVE VOLUME. EXAMPLE: A - THREE DISCOUNT OF DUPLICATES OPERATIONS UNDER THE FOLLOWING CONDITIONS: 1 - VALUE MADE AVAILABLE TO THE BORROWER: 75 MILLION - EFFECTIVE-DAY RATE: 1.38% 2 - VALUE MADE AVAILABLE TO THE BORROWER: 50 MILLION - EFFECTIVE-DAY RATE: 1.41% 3 - VALUE MADE AVAILABLE TO THE BORROWER: 92 MILLION - EFFECTIVE-DAY RATE: 1.37% 75(1.38) + 50(1.41) + 92(1.37) B - AVERAGE RATE = ------------------------------- = 1.3827% 75 + 50 + 92 C - VOLUME INVESTED ON THE DAY: 75 + 50 + 92 = 217 MILLION. IV - EXPENSES, FEES, TAXES OR ANY OTHER FORM OF INDIRECT CHARGING MUST NOT COMPOSE THE CALCULATION OF THE EFFECTIVE RATE TO BE REPORTED. V - IN THE "OVERDRAFT" AND "GUARANTEED ACCOUNT" MODALITIES, THE VOLUME TO BE REPORTED IS THE SUM OF DEBIT BALANCES (WITHDRAWALS) AND NOT OF CONTRACTED LIMITS. VI - IF THERE IS NO INVESTMENT IN CERTAIN MODALITIES ON A GIVEN DAY, NULL VALUES FOR RATES AND VOLUMES MUST BE REPORTED. VII - INVESTMENTS OF FUNDS ORIGINATING FROM GOVERNMENT TRANSFERS MUST NOT BE CONSIDERED. VIII - OPERATIONS AT POST-FIXED RATES MUST CONSIDER ONLY THE INTEREST, REGARDLESS OF THE INDEXERS USED. IX - IN OPERATIONS UNDER RESOLUTION No. 63, THE ORIGINALLY CONTRACTED RATE MUST HAVE THE "SPREAD" CHARGED BY THE FINANCIAL INSTITUTION ADDED TO IT, FOR THE PURPOSE OF CALCULATING THE EFFECTIVE-DAY RATE. BRASILIA (DF), APRIL 16, 1993 DEPARTMENT OF SPECIAL STUDIES AND MONITORING OF THE FINANCIAL SYSTEM RONALDO FONSECA DE PAIVA HEAD