Circular LISOL 1 - 357. Minimum liquidity requirements from October 2001. Extension of the temporary reduction of the minimum daily requirement. Modification of the minimum cash requirement and integration from October 2001

BANCO CENTRAL DE LA REPUBLICA ARGENTINA
__________________________________________________________________________ COMUNICACION " A " 3338 I 27/09/01 __________________________________________________________________________ TO FINANCIAL ENTITIES:
Ref.: LISOL 1 – 357.
Minimum liquidity requirements from October
2001. Extension of the temporary reduction of the minimum daily requirement. Modification of the minimum cash requirement and integration from October 2001

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

“1. Maintain the validity of the current structure of minimum liquidity requirements, which arises from the application of what is stipulated in point 1. of the resolution made known through Communication “A” 3311.

2. Extend until 12.31.01 the validity of point 2.2. of Section 2. of the regulations on “Minimum liquidity requirements” (minimum daily requirement of 60%), text according to Communication “A” 3302.

3. Substitute, with effect from 10.01.01, points 1.3. of Section 1., 2.1.5. and 2.3.
   of Section 2. of the regulations on “Minimum cash” with the following:

“1.3. Minimum cash.
The minimum cash amounts resulting from applying the following rates shall be integrated:

Concept Rate in %
1.3.1. Checking account deposits. 18,5
1.3.2. Savings account deposits. 18,5
1.3.3. Pupilar usuras, special accounts for closed circles, “Unemployment Fund for workers in the construction industry”, “Payment of remuneration”, special current accounts for legal entities and pension savings accounts. 18,5
1.3.4. Other deposits and demand obligations, including with banks and foreign correspondents, pension benefits credited by ANSES pending cashing and immobilized balances corresponding to obligations included in these regulations. 18,5
1.3.5. Unused balances of formalized current account advances. 18,5

1.3.6. Demand placements -regardless of the form of imposition and its remuneration- that, as a minimum, must constitute the assets of common investment funds (in accordance with what is provided in the regulations of the National Securities Commission). 50
1.3.7. Deposits in current accounts of non-bank financial entities, computable for the integration of their minimum cash. 100”

“2.1.5. Public securities.
Only Treasury Bills in pesos issued by the National Government are admitted, computed at their market value.”

“2.3. Maximum computation limits.
The integration in the admitted concepts will only be computable up to the following maximum limits, measured with respect to the minimum cash of each period:

Concept Maximum computable
-in %- i) Points 2.1.1. to 2.1.4. and 2.1.6. (together) 100 ii) Point 2.1.5. 20”

We send you attached the sheets that, in replacement of those previously provided, should be incorporated into the ordered text of the regulations on “Minimum cash”.

We salute you very attentively.

BANCO CENTRAL DE LA REPUBLICA ARGENTINA
Claudio A. Gatti Alfredo A. Besio
Submanager of Emission Manager of Emission of Norms of Norms

ANEXO

MINIMUM CASH B.C.R.A. Section 1. Requirement.
The requirement will be observed separately for each of the currencies in which the obligations are denominated.
At the option of the entities, the requirement on demand obligations for pending payment transfers and for foreign correspondent operations in foreign currencies other than the euro or the US dollar may be imputed to the requirement in the latter currency. This alternative may be applied whenever the requirement in currencies other than the US dollar or the euro does not exceed the equivalent of US$ 100,000 or 1% of the minimum cash requirement of all foreign currencies, whichever is greater.

1.3. Minimum cash.
The minimum cash amounts resulting from applying the following rates shall be integrated:

Concept Rate in %
1.3.1. Checking account deposits. 18,5
1.3.2. Savings account deposits. 18,5
1.3.3. Pupilar usuras, special accounts for closed circles,
“Unemployment Fund for workers in the construction industry”, “Payment of remuneration”, special current accounts for legal entities and pension savings accounts. 18,5
1.3.4. Other deposits and demand obligations, including with banks and foreign correspondents, pension benefits credited by ANSES pending cashing and
immobilized balances corresponding to obligations included in these regulations. 18,5
1.3.5. Unused balances of formalized current account advances. 18,5
1.3.6. Demand placements -regardless of the form of imposition and its remuneration- that, as a minimum, must constitute the
assets of common investment funds (in accordance with what is provided in the regulations of the National Securities Commission). 50 Version: 3rd Communication “A” 3338 Validity:
01.10.01

MINIMUM CASH B.C.R.A. Section 1. Requirement.
1.3.7. Deposits in current accounts of non-bank financial entities,
computable for the integration of their minimum cash. 100
1.4. Alternative requirement increase to debt placement.
The exercise of the option not to issue debt, as provided in the regulations on “Mandatory issuance and placement of debt”, determines an increase of one percentage point in the minimum cash rates for all concepts, starting from the month following that in which the maximum term between each issuance and placement expires. This increased requirement will automatically expire the month following that in which the entity effectively carries out a placement as provided in the regulations on “Mandatory issuance and placement of debt”, prior demonstration of this circumstance to the Superintendence of Financial and Exchange Entities. In case of fraud or action that, in the judgment of the Superintendence of Financial and Exchange Entities, implies, directly or indirectly, circumventing the compliance with the mandatory placement of debt, the minimum cash rates will be increased by an additional three percentage points.
1.5. Specific increases in requirement due to liability concentration.
When excessive concentration of liabilities (in titleholders and/or terms) is verified, which implies a significant risk with respect to the individual liquidity of the financial entity and/or has a significant negative effect on systemic liquidity, additional minimum cash requirements may be established on the liabilities included in the financial entity and/or those complementary measures deemed appropriate. It will be considered that this situation is configured when, among others, any of the following factors are present:

• A high percentage of liabilities is concentrated in the same titleholder or titleholders.
• In term obligations, the residual term is short.
• The aforementioned liabilities represent a significant percentage with respect to the integration of the minimum cash and the minimum liquidity requirements and/or the total of private sector deposits in the entity.
  Version: 3rd Communication “A” 3338 Validity:
  01.10.01

MINIMUM CASH B.C.R.A. Section 2. Integration.
The balance recorded at the close of each business day in these accounts will accrue interest for the period until the next business day, at the rate fixed daily and which will be transmitted through the Foreign Exchange and Open Market Operations Desk. The corresponding settlement will be made available to the entities at the opening of operations of the next business day through the STAF communications system; the accrued amounts will be automatically credited to the corresponding special accounts. In the case of US dollar accounts, also used for the integration of minimum liquidity requirements, the appropriation for these or for the minimum cash will be carried out by the entity after the computation period has concluded in accordance with the procedure established by the information regime. Current accounts 2.1.4. Current accounts of non-bank financial entities. Opened in commercial banks for the integration of the minimum cash requirement.
2.1.5. Public securities.
Only Treasury Bills in pesos issued by the National Government are admitted, computed at their market value.
2.1.6. Cash in transit and in cash transport companies.
Includes banknotes and coins in transit within the country from or to another financial entity or between offices of the same entity or in the possession of transport companies located in the country.
2.2. Computation.
The compliance with the integration of the minimum cash will be measured on the basis of the monthly average of daily balances of the concepts admitted for such effect, recorded during the same month to which the minimum cash corresponds, dividing the sum of said balances by the total number of days in the period. Days on which no movement is recorded must repeat the balance corresponding to the immediate previous business day. In the case of current accounts opened in commercial banks by non-bank entities, the balances reflected in account summaries will be taken into account. The computation of national public securities will be carried out taking into account the value that arises for each day of the month based on the daily quotation of the securities. Version: 4th Communication “A” 3338 Validity:
01.10.01

MINIMUM CASH B.C.R.A. Section 2. Integration.
2.3. Maximum computation limits.
The integration in the admitted concepts will only be computable up to the following maximum limits, measured with respect to the minimum cash of each period:

Concept Maximum computable
-in %- i) Points 2.1.1. to 2.1.4. and 2.1.6. (together) 100 ii) Point 2.1.5. 20 Version: 3rd Communication “A” 3338 Validity:
01.10.01

B.C.R.A. ORIGIN OF THE PROVISIONS INCLUDED IN THE ORDERED TEXT OF THE REGULATIONS ON MINIMUM CASH ORDERED TEXT SOURCE REGULATION OBSERVATIONS Sec. Point Para. Com. Annex Sec. Point Para.
1.1. “A” 3274 II 1. 1.1.
1.1.1. “A” 3274 II 1. 1.1.1.
1.1.2. “A” 3274 II 1. 1.1.2.
1.1.3. “A” 3274 II 1. 1.1.3.
1.2. “A” 3274 II 1. 1.2. According to Com. “A” 3304.
1.3. “A” 3274 II 1. 1.3.
1.3.1. “A” 3274 II 1. 1.3.1. According to Com. “A” 3338.
1.3.2. “A” 3274 II 1. 1.3.2. According to Com. “A” 3338.
1.3.3. “A” 3274 II 1. 1.3.3. According to Com. “A” 3338.
1.3.4. “A” 3274 II 1. 1.3.4. According to Com. “A” 3338.
1.3.5. “A” 3274 II 1. 1.3.6. According to Com. “A” 3338.
1.3.6. “A” 3274 II 1. 1.3.7.
1.3.7. “A” 3274 II 1. 1.3.8.
1.4. “A” 3274 II 1. 1.4.
1.5. “A” 3274 II 1. 1.5.
1.6. “A” 3274 II 1. 1.6.
1.6.1. “A” 3274 II 1. 1.6.1.
1.
1.6.2. “A” 3274 II 1. 1.6.2.
2.1. “A” 3274 II 2. 2.1. According to Com. “A” 3304.
2.1.1. “A” 3274 II 2. 2.1.1.
2.1.2. “A” 3274 II 2. 2.1.2. According to Com. "A" 3304.
2.1.3. “A” 3274 II 2. 2.1.3. According to Com. “A” 3304.
2.1.4. “A” 3274 II 2. 2.1.4.
2.1.5. “A” 3274 II 2. 2.1.5. According to Com. “A” 3338.
2.1.6. “A” 3311
2.2. “A” 3274 II 2. 2.2.
2.
2.3. “A” 3274 II 2. 2.3. According to Com. “A” 3311 and
3338.
3.1. “A” 3274 II 3. 3.1.
3.1.1. “A” 3274 II 3. 3.1.1.
3.1.2. “A” 3274 II 3. 3.1.2.
3.1.3. “A” 3274 II 3. 3.1.3.
3.1.4. “A” 3274 II 3. 3.1.4.
3.2. “A” 3274 II 3. 3.2.
3.2.1. “A” 3274 II 3. 3.2.1.
3.2.2. “A” 3274 II 3. 3.2.2.
3.3. “A” 3274 II 3. 3.3.
3.3.1. “A” 3274 II 3. 3.3.1.
3.
3.3.2. “A” 3274 II 3. 3.3.2.
4. 4.1. “A” 3274 II 4. 4.1.
5. 5.1. “A” 3274 II 5. 5.1.
6. 6.1. “A” 3274 II 6. 6.1.