Circular Liquidity and Solvency - LISOL 1 - 51. Modifications to current liquidity and solvency regulations

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
COMMUNICATION "A" 1883 11/10/91
TO FINANCIAL ENTITIES:
Ref.: CIRCULAR LIQUIDITY AND SOLVENCY - LISOL - 1 -
51. Modifications to current regulations on liquidity and solvency

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

"1. Repeal the prohibition on granting guarantees referred to in point 3 of Chapter I of Circular LISOL - 1.

2. Replace point 1.1 of Chapter II of Circular LISOL - 1 with the following:
   "1.1. The total of facilities granted to a client, in national or foreign currency, must not exceed 25% of the computable equity responsibility of each financial entity. In the case of a physical or legal person linked, the total of facilities must not exceed 6.25% of said computable equity responsibility. Private sector economic sets or groups, linked or not to the entity, shall be considered as a single client for the purpose of applying the corresponding limit in each case."

3. Replace point 1 of Chapter III of Circular LISOL - 1 (text according to Communication "A" 1214) with the following:
   "1. Limit.
   The investments in securities referred to in point 2.8 must not exceed 25% of the computable equity responsibility of the respective entity. For these purposes, the holding imputed to the segment of negotiable obligations that will not be considered as immobilized to determine the minimum capital requirement will be included. Participations in public service companies, necessary to obtain the service, are included in the fixed limit."

4. Replace point 5.1.1 of Chapter III of Circular LISOL - 1 (text according to Communication "A" 1214) with the following:
   "5.1.1. Goods taken in defense or in payment of credits will not be counted as immobilized assets for a period of six months, counted from the date of their incorporation into the entity's assets. For these purposes, only goods susceptible to being encumbered with pledges or mortgages will be considered."

5. Establish that the preceding provisions will be in effect under the terms indicated below:
   5.1. points 1. and 2.: from the day following the date on which this resolution is communicated.
   5.2. point 3.: from October 1991.
   5.3. point 4.: regarding goods that are incorporated from the day following the date of communication."

We remind you that, as previously announced by telephone, starting with the information corresponding to September 1991, forms 2965 "Statement of immobilized assets" and 2966 "Statement of the relationship for deposits and other obligations", will only need to be integrated with the data indicated below in each case:

• Form 2965: section A and row 1 of section B of Table I, section A of Table II and, if applicable, row 1 of Table III and the one intended for the settlement of the charge.
• Form 2966: columns B (2 or 4 times, as appropriate), H and N (rows 2. to 4.), row 5.2. and, if applicable, row 6. for whose integration the amount recorded in row 4., column N, will be taken into account.

We salute you very respectfully.
BANCO CENTRAL DE LA REPÚBLICA ARGENTINA
Alfredo A. Besio José Agustín Uriarte
Departmental Manager General Submanager
Monetary and Exchange Norms Area