Circular OPASI 2 - 179. Variable-Rate Term Investments. Modification

BANCO CENTRAL DE LA REPUBLICA ARGENTINA
__________________________________________________________________ COMUNICACION " A " 2617 11/11/97 __________________________________________________________________ TO FINANCIAL ENTITIES:
Ref.: Circular
OPASI 2 - 179.
Variable-Rate Term Investments.
Its Modification

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

"1. Replace points 4.2. and 5. of the regulation applicable to "Variable-Rate Term Investments" (Communication "A" 2482, point 1. section D), with the following:

"4.2. Variable:
Based on the proportion agreed upon regarding positive or negative variations registered in the price of assets or indicators included in the list contained in the Annex to this communication. To this effect, the price variation experienced by the chosen asset until the maturity of the investment or until the date - not predetermined contractually - chosen by the investor, if the investor has that right, shall be considered. Likewise, the markets or financial centers as well as the definition of the moments (initial, final, average, etc.) and means that will serve as a reference to obtain the values of the chosen parameters must be precisely identified. In the relevant clause, in addition to its literal definition, the mathematical expression used to calculate the return (with identification of all variables involved) must appear."

"5. Central Bank Approval.
The collection of resources under this regime is subject to prior approval by the Central Bank, for which entities must provide the particular characteristics assigned to the modality. It must be expressly provided that operations for hedging the risks linked to the variable return offered - reproducing the assumed commitment - are conducted with entities that have an international rating of level "A" or higher, granted by international rating agencies admitted by the Central Bank (point 2.2. of Section 2. of Annex II to Communication "A" 2521)."

2. Add to the regulation applicable to "Variable-Rate Term Investments" (Communication "A" 2482, point 1. section D), the following point:

"6. The need to introduce corrections in the agreed contractual clauses - even if it is alleged that errors slipped into the original version - will be considered - in the judgment of this Institution - a deficient technical and administrative development of the operation, both in its instrumental and control aspects, which will be taken into account in the evaluation performed by the Superintendence of Financial and Exchange Entities in the respective category integrating the rating system, and may also give rise to the cancellation of the authorization to intervene in this operational modality."

3. Establish that this resolution will be effective from 14.11.97.
   Consequently, operations entered into from that date must comply with the new conditions established by this resolution, and returns that take into account price variations of assets other than those listed in the Annex may not be agreed upon."

We salute you very attentively.
BANCO CENTRAL DE LA REPUBLICA ARGENTINA
Juan Carlos Isi Alfredo A. Besio
Deputy Manager of Standards for Financial Entities Manager of Standards for Financial Entities

ANEXO

+--------+-----------------------------------------+-------------+ I IACTIVOS AND OTHER ACCEPTED INDICA-I Annex I IB.C.R.A.IRA DETERMINE THE YIELD OF THE IN-I a la I I IVESTMENTS WITH VARIABLE RETRI-ICom. "A" 2617I BLE (Com. "A" 2482, pt. 1., ap. D) I I +--------+-----------------------------------------+-------------+
1. National public bonds.
1.1. Guaranteed Fixed-Rate Bonds of the Argentine Republic ("Par").
1.2. Guaranteed Floating-Rate Bonds of the Argentine Republic in u$s ("Discount").
1.3. Floating-Rate Bonds in u$s ("FRB").
1.4. External Bonds 1989 and 1992.
1.5. Bonds for the Consolidation of Pension Debts (both series, in pesos and in dollars).
1.6. Consolidation Bonds (in pesos and in dollars).
1.7. Global External Bonds of the Argentine Republic 1999, 2001, 2003, 2006, 2017 and 2027.
1.8. External Letters of the Argentine Republic 2002 and 2007.
2. Foreign public bonds.
2.1. "Brady" series issued by Brazil ("C Bond"; "IDU"), Venezuela ("Par"; "D.C.B.") and Mexico ("Par"; "Discount").
2.2. Bonds issued by the treasuries of the central governments of Germany, United States of America, France, England and Italy.
3. Stock indices.
3. 1. Merval (Buenos Aires).
3. 2. Burcap (Buenos Aires).
3. 3. Dow Jones (New York).
3. 4. Standard & Poor's (New York).
3. 5. Bovespa (Sao Paulo).
3. 6. Ipsa (Santiago de Chile).
3. 7. FTSE (London).
3. 8. CAC (Paris).
3. 9. DAX (Frankfurt).
3.10. Nikkei (Tokyo).
3.11. IPC (Mexico).

4. Commodities.
4.1. Gold (London).
4.2. "Brent North Sea" Oil (London) and WTI (New York).
4.3. Wheat (local markets and Chicago).
4.4. Corn (local markets and Chicago).
4.5. Soybeans (local markets and Chicago).
4.6. Sunflower oil (Rotterdam).
5. Currencies.
Germany, Belgium, Brazil, Canada, United States of America, France, Netherlands, England, Italy, Japan, Sweden and Switzerland.
6. Rates.
LIBOR for operations conducted in some of the currencies admitted according to point 5. above.