BANCO CENTRAL DE LA REPÚBLICA ARGENTINA

COMUNICACIÓN “A” 4276 09/01/2005

TO FINANCIAL ENTITIES:

Ref.: Circular
REMON 1 - 792
Reduction of the minimum cash requirement in pesos. Penalties for non-compliance.
Modification.

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

“1. Substitute, with effect from 1.1.05, point 1.3. of Section 1. 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. Current account deposits.	16
1.3.2. Savings account deposits.
1.3.2.1. In pesos.	16
1.3.2.2. In foreign currency.	30
1.3.3. Usura pupilares, special accounts for closed circles, “Unemployment Fund for Construction Industry Workers”, “Payment of Remuneration”, special current accounts for legal entities and pension savings accounts.
1.3.3.1. In pesos.	16
1.3.3.2. In foreign currency.	30
1.3.4. Other demand deposits and obligations, pension benefits credited by ANSES pending cashing, and immobilized balances corresponding to obligations included in these regulations.
1.3.4.1. In pesos.	16
1.3.4.2. In foreign currency.	30
1.3.5. Unused balances of formalized current account advances.	16
1.3.6. Demand placements -regardless of the form of imposition- 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).	100
1.3.7. Deposits in current accounts of non-bank financial entities, computable for the integration of their minimum cash.	100
1.3.8. Time deposits, obligations for “acceptances” -including liabilities for the sale or assignment of credits to subjects other than financial entities-, passive repos, guarantees and passive stock market repos, investments with constant term, with option for early cancellation or renewal for a determined term and with variable remuneration, and other term obligations, with the exception of deposits included in points 1.3.12. and 1.3.15., according to their residual term:
1.3.8.1. In pesos.
i) Up to 29 days.	16
ii) From 30 to 59 days.	13
iii) From 60 to 89 days.	9
iv) From 90 to 179 days.	4
v) From 180 to 365 days.	2
vi) More than 365 days.	0

Deposits with “CER” clause and those included in the “Deposit Reprogramming Regime” are included in this point -without excluding those reached according to point 6.5., in whole or in part if applicable depending on the nature of the judicial decision-.

1.3.8.2. In foreign currency.
i) Up to 29 days.	35
ii) From 30 to 59 days.	28
iii) From 60 to 89 days.	20
iv) From 90 to 179 days.	10
v) From 180 to 365 days.	6
vi) More than 365 days.	0
1.3.9. Obligations for foreign financial lines (not instrumented through time deposits or debt securities to which the requirements provided in points 1.3.8. and 1.3.10. apply, respectively).	0
1.3.10. Debt securities (including debentures).
a) Debt issued from 1.1.02, including those from restructured obligations, according to their residual term:
In pesos.
i) Up to 29 days.	16
ii) From 30 to 59 days.	13
iii) From 60 to 89 days.	9
iv) From 90 to 179 days.	4
v) From 180 to 365 days.	2
vi) More than 365 days.	0
In foreign currency.
i) Up to 29 days.	35
ii) From 30 to 59 days.	28
iii) From 60 to 89 days.	20
iv) From 90 to 179 days.	10
v) From 180 to 365 days.	6
vi) More than 365 days.	0
b) Others.	0
1.3.11. Obligations with the Fiduciary Fund for Assistance to Financial and Insurance Entities.	0
1.3.12. Demand and time deposits made by order of the Justice with funds originating in the cases in which it intervenes, and their immobilized balances.
1.3.12.1. In pesos.	10
1.3.12.2. In foreign currency.	15
1.3.13. Special accounts in US dollars destined for the deposit of guarantees required in futures and options operations carried out in self-regulated markets subject to the control of the National Securities Commission.	100
1.3.14. Special demand accounts in foreign currency.	100
1.3.15. Deposits -regardless of their modality- that constitute the assets of common investment funds (except those included in point 1.3.6.).
1.3.15.1. In pesos.	25
1.3.15.2. In foreign currency.	40”

2. Replace, with effect from 1.1.05, the first paragraph of point 2.1.4. of Section 2. and point 3.1.1. of Section 3. of the regulations on “Minimum Cash”, with the following:

“2.1.4. Special guarantee accounts in favor of electronic clearing chambers and for the coverage of the settlement of operations with credit cards, consumption vouchers and in automated teller machines.”

“3.1.1. Deficiencies in the integration of the minimum cash and of the daily minimum integration in pesos shall be subject to a charge equivalent to twice the last interest rate for active peso repos with the Central Bank of the Republic Argentina, reported in the period of non-compliance for the operation of the longest term, provided it does not exceed 30 days.

Deficiencies in integration in foreign currency are subject to a charge equivalent to twice the nominal annual interest rate resulting from the tenders of the Letters of the Central Bank of the Republic Argentina in US dollars or twice the 30-day LIBO rate for operations in that currency, reported for the last business day of the pertinent month, whichever is higher.

In the case of the Letters of the Central Bank of the Republic Argentina, the accepted cut-off rate reported by this Institution shall be taken into account, which is expressed as a nominal annual rate due, corresponding to the last tender carried out in the period under report.

If letters are awarded for different terms on the same date, the rate corresponding to the operation of the shortest term shall be considered.

When deficiencies in the average position and in the daily minimum integration are verified concurrently in the same month, the charge resulting from the higher amount shall be paid.

To determine the deficiencies of the average position, the following shall be considered:

i) those for which the option of their transfer is not used. ii) those that are not susceptible of being transferred to the next month by exceeding the admitted margin.”

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 respectfully.

BANCO CENTRAL DE LA REPUBLICA ARGENTINA

Alfredo A. Besio
Gerente de Emisión de Normas

José I. Rutman
Gerente Principal de Normas

ANEXO

MINIMUM CASH B.C.R.A.

Section 1. Requirement.
Version: 20th. COMMUNICATION “A” 4276
Validity:
01/01/2005

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

Concept	Rate in %
1.3.1. Current account deposits.	16
1.3.2. Savings account deposits.
1.3.2.1. In pesos.	16
1.3.2.2. In foreign currency.	30
1.3.3. Usura pupilares, special accounts for closed circles, “Unemployment Fund for Construction Industry Workers”, “Payment of Remuneration”, special current accounts for legal entities and pension savings accounts.
1.3.3.1. In pesos.	16
1.3.3.2. In foreign currency.	30
1.3.4. Other demand deposits and obligations, pension benefits credited by ANSES pending cashing, and immobilized balances corresponding to obligations included in these regulations.
1.3.4.1. In pesos.	16
1.3.4.2. In foreign currency.	30
1.3.5. Unused balances of formalized current account advances.	16
1.3.6. Demand placements -regardless of the form of imposition- 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).	100
1.3.7. Deposits in current accounts of non-bank financial entities, computable for the integration of their minimum cash.	100
1.3.8. Time deposits, obligations for “acceptances” -including liabilities for the sale or assignment of credits to subjects other than financial entities-, passive repos, guarantees and passive stock market repos, investments with constant term, with option for early cancellation or renewal for a determined term and with variable remuneration, and other term obligations, with the exception of deposits included in points 1.3.12. and 1.3.15., according to their residual term:

MINIMUM CASH B.C.R.A.

Section 1. Requirement.
Version: 20th. COMMUNICATION “A” 4276
Validity:
01/01/2005

1.3.8.1. In pesos.

i) Up to 29 days. 16 ii) From 30 to 59 days. 13 iii) From 60 to 89 days. 9 iv) From 90 to 179 days. 4 v) From 180 to 365 days. 2 vi) More than 365 days. 0

Deposits with “CER” clause and those included in the “Deposit Reprogramming Regime” are included in this point -without excluding those reached according to point 6.5., in whole or in part if applicable depending on the nature of the judicial decision-.

1.3.8.2. In foreign currency.

i) Up to 29 days. 35 ii) From 30 to 59 days. 28 iii) From 60 to 89 days. 20 iv) From 90 to 179 days. 10 v) From 180 to 365 days. 6 vi) More than 365 days. 0

1.3.9. Obligations for foreign financial lines (not instrumented through time deposits or debt securities to which the requirements provided in points 1.3.8. and 1.3.10. apply, respectively). 0

1.3.10. Debt securities (including debentures).

a) Debt issued from 1.1.02, including those from restructured obligations, according to their residual term:

In pesos.

i) Up to 29 days. 16 ii) From 30 to 59 days. 13 iii) From 60 to 89 days. 9 iv) From 90 to 179 days. 4 v) From 180 to 365 days. 2 vi) More than 365 days. 0

MINIMUM CASH B.C.R.A.

Section 2. Integration.
Version: 7th. COMMUNICATION “A” 4276
Validity:
01/01/2005

2.1. Admitted Concepts.
The integration must be carried out in the same currency that corresponds to the requirement.

2.1.1. Cash.
Includes banknotes and coins maintained in the entity's offices and in custody in other financial entities.

2.1.2. Current accounts of financial entities opened at the Central Bank in pesos.

2.1.3. Minimum Cash accounts of financial entities opened at the Central Bank in US dollars or in other foreign currencies.

2.1.4. Special guarantee accounts in favor of electronic clearing chambers and for the coverage of the settlement of operations with credit cards, consumption vouchers and in automated teller machines.

They shall be considered, even when the balances are affected as guarantee for the electronic clearing and settlement chambers and deposited in their name, on behalf of the respective entity, in special accounts in pesos at the Central Bank of the Republic Argentina.

2.1.5. Current accounts of non-bank financial entities.
Opened in commercial banks for the integration of the minimum cash requirement.

2.1.6. Cash in transit and in cash-in-transit 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.

2.1.7. Special guarantee accounts for the operation with canceling checks, at the Central Bank.

They shall be considered, even when the balances are affected as guarantee for the operation with canceling checks.

2.1.8. Special current accounts opened at the Central Bank linked to the attention of pension benefits under the National Social Security Administration.

MINIMUM CASH B.C.R.A.

Section 2. Integration.
Version: 8th. COMMUNICATION “A” 4276
Validity:
01/01/2005

2.2. Computation.
The compliance with the integration of the minimum cash will be measured based on the monthly average of daily balances of the admitted concepts for this purpose, registered 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. The days on which no movement is registered 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 the account summaries shall be taken into account.

2.3. Daily Minimum Integration.
On no day of the month, the sum of the balances of the admitted concepts for integration referred to in points 2.1.2. to 2.1.5., 2.1.7. and 2.1.8., registered at the close of each day, may be less than 50% of the total minimum cash requirement, determined for the immediately preceding month, recalculated based on the requirements and concepts in effect in the month to which the reserves correspond, without considering the effects of the application of what is provided in point 1.6.1. of Section 1.

This daily requirement shall be 70% when a deficiency in average monthly integration exceeding the admitted transfer margin has been registered in the previous computation period.

2.4. Remuneration of account balances in pesos opened at the Central Bank.
Interest shall be recognized on the monthly average of the daily balances of the current accounts and of the special guarantee accounts in favor of the electronic clearing chambers and for the coverage of the settlement of operations with credit cards, consumption vouchers and in automated teller machines (considered together), without exceeding the higher of the amounts resulting from comparing the result of the following procedure:

2.4.1. Monthly minimum cash requirement in pesos net of the integration carried out through the admitted concepts of points 2.1.1. and 2.1.5. to 2.1.8.

2.4.2. Daily minimum integration requirement net of the integration carried out through the admitted concepts of points 2.1.5., 2.1.7. and 2.1.8.

Interest shall accrue at the rate that is set and that will be transmitted through the Foreign Exchange and Open Market Operations Desk. In case of modifications during the same month, the weighted average rate based on the number of calendar days of validity in the period shall be used.

The amounts shall be credited to the corresponding accounts within 5 business days of validating the presentation of the pertinent information regime.

MINIMUM CASH B.C.R.A.

Section 3. Non-Compliance.
Version: 7th. COMMUNICATION “A” 4276
Validity:
01/01/2005

3.1. Charge.

3.1.1. Deficiencies in the integration of the minimum cash and of the daily minimum integration in pesos shall be subject to a charge equivalent to twice the last interest rate for active peso repos with the Central Bank of the Republic Argentina, reported in the period of non-compliance for the operation of the longest term, provided it does not exceed 30 days.

Deficiencies in integration in foreign currency are subject to a charge equivalent to twice the nominal annual interest rate resulting from the tenders of the Letters of the Central Bank of the Republic Argentina in US dollars or twice the 30-day LIBO rate for operations in that currency, reported for the last business day of the pertinent month, whichever is higher.

In the case of the Letters of the Central Bank of the Republic Argentina, the accepted cut-off rate reported by this Institution shall be taken into account, which is expressed as a nominal annual rate due, corresponding to the last tender carried out in the period under report.

If letters are awarded for different terms on the same date, the rate corresponding to the operation of the shortest term shall be considered.

When deficiencies in the average position and in the daily minimum integration are verified concurrently in the same month, the charge resulting from the higher amount shall be paid.

To determine the deficiencies of the average position, the following shall be considered:

i) those for which the option of their transfer is not used. ii) those that are not susceptible of being transferred to the next month by exceeding the admitted margin.

3.1.2. The charges may be reduced in exceptional cases, when mitigating circumstances are present and weighing the causes that originated the non-compliance.

3.1.3. Charges not paid in time and form shall be subject during the period of non-compliance to an interest equivalent to the rate resulting from adding 50% to the rate applicable to the deficiency, as provided in point 3.1.1.

3.1.4. The charge shall be calculated with the following expression:

c = D * TNA / 36500

Where c: amount of the charge.

B.C.R.A.

ORIGIN OF THE PROVISIONS INCLUDED IN THE ORDERED TEXT OF THE REGULATIONS ON “MINIMUM CASH”

ORDERED TEXT				ORIGIN NORM				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.				According to Com. “A” 3498.
1.1.2.	“A” 3274	II	1.	1.1.2.				According to Com. “A” 3597.
1.1.3.	“A” 3274	II	1.	1.1.3.				According to Com. “A” 3498 and “A” 3905.
1.2.	“A” 3274	II	1.	1.2.				According to Com. “A” 3304, “A” 3498 and “A” 3597.
1.3.	“A” 3274	II	1.	1.3.
1.3.1.	“A” 3274	II	1.	1.3.1.				According to Com. “A” 3338, “A” 3417, “A” 3498, “A” 3597, “A” 3917, “A” 3967, “A” 4032, “A” 4051, “A” 4147 and ”A” 4276.
1.3.2.	“A” 3274	II	1.	1.3.2.				According to Com. “A” 3338, “A” 3417, “A” 3498, “A” 3597, “A” 3917, “A” 3967, “A” 4032, “A” 4051, “A” 4147, “A” 4179 and ”A” 4276.
1.3.3.	“A” 3274	II	1.	1.3.3.				According to Com. “A” 3338, “A” 3399, “A” 3417, “A” 3498, “A” 3597, “A” 3824, “A” 3917, “A” 3967, “A” 4032, “A” 4051, “A” 4147, “A” 4179 and ”A” 4276.
1.3.4.	“A” 3274	II	1.	1.3.4.				According to Com. “A” 3338, “A” 3417, “A” 3498, “A” 3597, “A” 3917, “A” 3967, “A” 4032, “A” 4051, “A” 4147, “A” 4179 and ”A” 4276.
1.3.5.	“A” 3274	II	1.	1.3.5.				According to Com. “A” 3338, “A” 3417, “A” 3498, “A” 3597, “A” 3917, “A” 3967, “A” 4032, “A” 4051, “A” 4147 and ”A” 4276.
1.3.6.	“A” 3274	II	1.	1.3.6.				According to Com. “A” 3365, “A” 3498, “A” 3967 and “A” 4179.
1.3.7.	“A” 3274	II	1.	1.3.7.
1.3.8.	“A” 3498	único	1.	1.3.8.				According to Com. “A” 3506 - pt. 2.-, “A” 3549, “A” 3732, “A” 3824, “A” 3905, “A” 3917, “A” 3925, “A” 3967, “A” 4032, “A” 4140, “A” 4179 and ”A” 4276.
1.3.9.	“A” 3498	único	1.	1.3.11.				According to Com. “A” 3597, “A” 3732 and “A” 4032.
1.3.10.	“A” 3498	único	1.	1.3.12.				According to Com. “A” 3905, “A” 3917, “A” 3967, “A” 4032, “A” 4179 and ”A” 4276.
1.3.11.	“A” 3549		1.
1.3.12.	“A” 3549		1.					According to Com. “A” 4179.
1.3.13.	“A” 3566		5.
1.3.14.	“A” 3583		3.

MINIMUM CASH

ORDERED TEXT				ORIGIN NORM				OBSERVATIONS
Sec.	Point	Para.	Com.	Annex	Sec.	Point	Para.
1.3.15.	“A” 4179		2.
1.4.	“A” 3905		3.					According to Com. “A” 4179.
1.5.	“A” 3274	II	1.	1.5.				According to Com. “A” 3498.
1.6.	“A” 3274	II	1.	1.6.
1.6.1.	“A” 3274	II	1.	1.6.1.
1.6.2.	“A” 3274	II	1.	1.6.2.				According to Com. “A” 3304.
1.7.	“A” 3498	único	1.	1.8.				According to Com. “A” 4147.
2.1.	“A” 3274	II	2.	2.1.				According to Com. “A” 3498 and “A” 3597.
2.1.1.	“A” 3274	II	2.	2.1.1.				According to Com. "A" 3304.
2.1.2.	“A” 3274	II	2.	2.1.2.				According to Com. “A” 3304, “A” 3498, “A” 4016 and “A” 4147.
2.1.3.	“A” 3498	único	2.	2.1.3.				According to Com. “A” 4147.
2.1.4.	“A” 3274	II	2.	2.1.3.				According to Com. “A” 3498, “A” 4147 and ”A” 4276.
2.1.5.	“A” 3274	II	2.	2.1.4.
2.1.6.	“A” 3311
2.1.7.	“A” 3498	único	2.	2.1.7.
2.1.8.	“A” 4016		1.
2.2.	“A” 3274	II	2.	2.2.				According to Com. “A” 3498
2.3.	“A” 3365		2.					According to Com. “A” 3387, 3470, “A” 3498, “A” 3549, “A” 3597, “A” 3732, “A” 3824 and “A” 4016.
2.4.	“A” 4147		3.					According to Com. ”A” 4276.
2.5.	“A” 4147		3.
3.1.	“A” 3274	II	3.	3.1.
3.1.1.	“A” 3274	II	3.	3.1.1.				According to Com. “A” 3326, 3365, “A” 3498, “A” 3549, “A” 3905 and ”A” 4276.
3.1.2.	“A” 3274	II	3.	3.1.2.
3.1.3.	“A” 3274	II	3.	3.1.3.				According to Com. “A” 3326.
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.	3.2.2.1.
3.2.2.	“A” 3274	II	3.	3.2.2.2.
3.3.	“A” 3274	II	3.	3.3.				According to Com. “A” 3498.
3.3.1.	“A” 3274	II	3.	3.3.1.
3.3.2.	“A” 3274	II	3.	3.3.2.
4.1.	“A” 3274	II	4.	4.1.
5.1.	“A” 3274	II	5.	5.1.				According to Com. “A” 3498.
5.2	“A” 3905		5.
5.3	“A” 3905		5.
6.1.	“A” 3824							According to Com. “A” 4032.