Circular LISOL 1 - 100. Computable Equity Liability. Treatment of the Restatement of Non-Monetary Assets

BANCO CENTRAL DE LA REPUBLICA ARGENTINA
__________________________________________________________________ COMUNICACION " A " 2279 12/12/94 __________________________________________________________________ TO FINANCIAL ENTITIES:
Ref.: Circular
LISOL 1 - 100.
Computable Equity Liability. Treatment of the Restatement of Non-Monetary Assets

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

"- Substitute, with effect from January 1995, the first paragraph of point 3.1. of Chapter VI of Circular LISOL - 1 (text according to Communication 'A' 2266), with the following:

"3.1. Determination. Computable Concepts.
The computable equity liability of financial entities, for the purposes of the regulatory norms of the prescriptions of articles 30 and 32 of Law 21.526 and other provisions of the Central Bank referring to this concept, will arise from the following expression:

RPC = PNb + PNc - Cd - D - Vd

where

RPC : Computable Equity Liability
PNb : Basic Net Equity, including the effect of the balance of the account 'Difference in valuation not realized due to holdings of public securities available for sale'. PNc : Complementary Net Equity, not exceeding 100% of PNb Cd : Accounts that must be deducted according to point 3.2. of Chapter VI of Circular LISOL - 1 and complementary norms.

D : 100% of the positive amount of the restatement of non-monetary assets, except for concepts included in Cd - net of the amortizations attributable to them -, generated from the balances as of January 1995, to the extent that the assets are maintained in equity. Vd : Total positive difference between the lower value of the securities and the lower value of the relevant liabilities - measured with respect to their accounting valuation, according to point 1.7.1. of the resolution disseminated by Communication 'A' 2266 -, originating from variations in the level of market interest rates, when that difference exceeds 3% of the computable equity liability of the month prior to the one in question, in cases where there is an admitted mismatch in the duration of assets and liabilities (point 1.2.1. of the resolution disseminated via Communication 'A' 2266)."

We salute you very respectfully.
BANCO CENTRAL DE LA REPUBLICA ARGENTINA
Alfredo A. Besio Miguel A. Kiguel
Manager of Standards for General Manager
Financial Entities Area of Economics and Finance