Circular No. 1367 — Mortgage Bonds - Decree-Law 2478 of September 28, 1988. Issuance by Entities of the Housing Financial System. Redemption Period. Complementary Norms

CIRCULAR NO. 001367

We communicate that the Board of Directors of the Central Bank of Brazil, in a meeting held on October 12, 1988, having regard to the provisions of Article 5 of Decree-Law No. 2,478 of September 27, 1988, decided to establish the following conditions for mortgage bonds:

a) issuance shall be exclusive to institutions acting in the granting of financing with resources from the Housing Financial System;

b) the guarantee shall be the pledge of mortgage credits over which the institutions referred to in the preceding item are holders, guaranteed by a first mortgage;

c) the minimum issuance period shall be 180 (one hundred and eighty) days;

d) control of issuances shall be carried out by present value;

e) the financial institution must maintain off-balance-sheet controls that allow for the identification of the credits serving as guarantee for the issued bonds.

2. This Circular shall enter into force on the date of its publication, with Item 9 of Circular No. 1,278 of January 5, 1988, and Circular No. 1,150 of March 24, 1987, being revoked.

Brasília-DF, October 19, 1988

Keyler Carvalho Rocha Wadico Waldir Bucchi Director Director