Circular No. 2.934

CIRCULAR N. 002934 ------------------ Amends the risk-weighting factor in the Asset Classification Table of Regulation Annex IV to Resolution No. 2.099 of 1994, and creates accounting accounts in COSIF. The Board of Directors of the Central Bank of Brazil, in a session held on 4 October 1999, based on art. 4, item XII, of Law No. 4.595 of 31 December 1964, by competence delegated by the National Monetary Council, by act of 19 July 1978, and in view of the provisions of art. 2, paragraph 2, of Regulation Annex IV to Resolution No. 2.099 of 17 August 1994, D E C I D E D: Art. 1 Reduce, from 100% (one hundred percent) to 0% (zero percent), the risk-weighting factor applicable to the portions of credit operations carried out by financial institutions and other institutions authorized to operate by the Central Bank of Brazil, guaranteed by funds or any other credit risk coverage mechanisms established by the Federal Constitution or federal law, by law of the Federal District, state or municipal, or created by official or private bodies, provided that the resources guaranteeing the operations are available or invested in immediately liquid assets and segregated in an amount equivalent to that of the guarantees provided by the aforementioned funds or mechanisms, so as to immediately cover any default by the respective borrower. Paragraph 1 The liquidity and segregation conditions established in the caput do not apply to funds established by the Federal Constitution or federal law that rely on contributions of resources from the Union. Paragraph 2 It is incumbent upon the financial institution benefiting from the guarantee provided to prove before the Central Bank of Brazil, at any time, the conditions established in this article. Art. 2 The accounts 3.0.4.67.00-8 VALORES GARANTIDOS POR FUNDOS OU MECANISMOS GOVERNAMENTAIS OU OFICIAIS and 9.0.4.67.00-0 VALORES COM GARANTIA DE FUNDOS OU MECANISMOS GOVERNAMENTAIS OU OFICIAIS are created in the Chart of Accounts for Institutions of the National Financial System (COSIF), with attributes UBDKIFERLMNZ and ESTBAN codes 300 and 800, respectively, intended for recording the portions of financing guaranteed with the resources mentioned in the previous article. Art. 3 The account 3.0.4.67.00-8 VALORES GARANTIDOS POR FUNDOS OU MECANISMOS GOVERNAMENTAIS OU OFICIAIS is included, with a negative sign and a weighting factor of 100% (one hundred percent), in the Asset Classification Table referred to in art. 2, paragraph 1, of Regulation Annex IV to Resolution No. 2.099 of 1994, with the amendments introduced by Circular No. 2.568 of 4 May 1995. Art. 4 Operations that rely on the guarantee referred to in art. 1 must be classified in the appropriate financing accounts and controlled in internal-use subaccounts. Art. 5 This Circular enters into force on the date of its publication. Brasília, 4 October 1999 Arminio Fraga Neto President