Circular No. 2.595

CIRCULAR N. 002595 ------------------ Establishes mandatory deposit at the Central Bank on the Net Equity of the Short-Term Financial Investment Fund. The Board of the Central Bank of Brazil, based on art. 66 of Law No. 9.069, of 29.06.95, on art. 1 of Resolution No. 2.183, of 21.07.95, and on art. 42, item II, subitem "a" of the Regulation annexed to Circular No. 2.594, of 21.07.95, D E C I D E D: Art. 1 The institutions administering Short-Term Financial Investment Funds must maintain at the Central Bank a mandatory deposit, in cash, equivalent to 35% (thirty-five percent) of the Net Equity of the respective fund. Art. 2 The requirement of the mandatory deposit referred to in art. 1 of this Circular shall be based on the daily arithmetic average of the Net Equity, calculated at the end of the day, during the calculation period. Paragraph 1 The calculation period is defined as the business days comprised in the period of two consecutive weeks, which move one by one, beginning on a Monday and ending on the Friday of the following week. Paragraph 2 The adjustment date is defined as the Wednesday of the week following the end of the calculation period, it being understood that, if Wednesday is not a business day, the adjustment shall be made on the first subsequent business day, remaining unavailable until the subsequent adjustment date. Art. 3 The mandatory deposit at the Central Bank: I - has its constitution and movement carried out exclusively via the Banking Reserves account; and II - shall not be entitled to any remuneration. Sole paragraph. The institution administering a fund that does not hold a Banking Reserves account must enter into an agreement under the terms provided in Circular No. 2.425, of 15.06.94. Art. 4 If insufficiency in the mandatory deposit is found, the administering institution incurs the payment of financial costs, calculated on the amount of the deficiency found. Paragraph 1 The financial costs shall be calculated considering the days, between consecutive adjustment dates, during which the deficiency persisted and due on the date of regularization or of the subsequent adjustment, whichever occurs first, based on the adjusted average rate of all financing operations registered in the Special System for Settlement and Custody (SELIC), regardless of the characteristics of the securities, plus 30% (thirty percent) per year. Paragraph 2 The financial costs related to eventual past deficiencies shall be updated based on the daily rate of Interfinancial Deposits (DI) and debited on a present date, and the financial institution may opt for the valorized debit, and such option must be communicated to the Regional Office of the Central Bank where it is subject to jurisdiction until the third business day following the processing of the alterations/entries that gave rise to them. Paragraph 3 The administering institution is prohibited from reimbursing itself for the financial costs referred to in this article by passing on the
corresponding burden to the quotaholders. Paragraph 4 The daily factors used for the purposes of calculating the financial cost may be obtained by consulting the PTAX860 and PTAX880 transactions of the Central Bank Information System (SISBACEN). Art. 5 This Circular enters into force on the date of its publication, producing effects as from the first calculation period, which, exceptionally, shall be from 01.08.95 to 11.08.95, with adjustment on 16.08.95. Brasília, 21 July 1995 Alkimar Ribeiro Moura Cláudio Ness Mauch Director of Monetary Policy Director of Norms and Organization of the Financial System NOTE: Reissued due to alterations made in art. 4, paragraph 1.