Circular REMON 1 - 888: Minimum Cash Requirements. Modifications.

2014 - YEAR OF TRIBUTE TO ADMIRAL GUILLERMO BROWN, ON THE BICENTENNIAL OF THE NAVAL BATTLE OF MONTEVIDEO

COMMUNICATION “A” 5631 12/09/2014

TO FINANCIAL ENTITIES:

Ref.: Circular
REMON 1 - 888
Minimum Cash. Modifications.

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

“1. Incorporate, with effect from 1.10.14., in Section 1. of the rules on “Minimum Cash”, the following point:

“1.5.5. Based on the granting of financing for the acquisition of goods and services referred to in the “AHORA 12” Program.

The requirement shall be reduced by an amount equivalent to 16% of the peso financing that the entity grants in accordance with the “AHORA 12” Program referred to in Joint Resolution No. 671/2014 and 267/2014 of the Ministry of Economy and Public Finance and the Ministry of Industry, respectively, whose purpose is the acquisition of goods and services included in said resolution and its complementary rules.

To this effect, the balance of the financing achieved from the period prior to the calculation period of the requirement that meet the stated requirements shall be considered.

This deduction, furthermore, shall not exceed 1% of the peso items subject to the requirement, on average, of the month prior to the calculation period.”

2. Replace, with effect from 1.10.14, the last paragraph of point 1.5. of Section 1. of the rules on “Minimum Cash”, with the following:

“The total decrease in the requirement - resulting from considering what is provided in points 1.5.1. to 1.5.5. jointly - shall not exceed the amount of the requirement previously determined.”

Finally, we send you the sheets that, in replacement of those previously provided, should be incorporated into the rules in question. Likewise, we remind you that on this Institution’s website www.bcra.gob.ar, accessing “regulations” (“ordered texts”), the modifications made with texts highlighted in special characters (strikethrough and bold) will be found.

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We greet you attentively.

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA

Matías A. Gutiérrez Girault Darío C. Stefanelli Manager of Emission Head of the General of Regulations Supervisory Office of Regulations a/c

ANNEX

1.5.3. Based on the credits made by the National Social Security Administration (ANSES) for the payment of social security benefits.

The requirement shall be reduced by the amount resulting from the following expression:

Q(I-IV) x 0.027 + Q(V-VI) x 0.056

Where:

Q(I-IV): total amount in pesos credited in the previous month by ANSES to make payment of salaries and/or other social security benefits -such as social aid plans or programs-, to the extent that the locality in which the operational office where the payment is made is located belongs to any jurisdiction included in categories I to IV -provided for in point 3.3. of Section 3. of Chapter II of Circular CREFI - 2-.

Q(V-VI): total amount in pesos credited in the previous month by ANSES to make payment of salaries and/or other social security benefits -such as social aid plans or programs-, to the extent that the locality in which the operational office where the payment is made is located belongs to any jurisdiction included in categories V and VI -provided for in point 3.3. of said Circular CREFI - 2-.

1.5.4. Based on the granting of financing to Small and Medium Enterprises (MiPyMEs) from 1.1.14 (with effect from 1.3.14).

The requirement shall be reduced by an amount equivalent to 16% of the financing agreed to SMEs from 1.1.14, in accordance with the provisions of the rules on the “Credit Line for Productive Investment”, to the extent that it is verified that the term of said financing at the time of its granting exceeds 5 years, without its average term being less than 30 months.

To this effect, the monthly average of daily balances of the aforementioned financing -principal- of the month prior to the calculation period of the requirement shall be considered.

This reduction shall also apply to financial entities that, despite not being included in point 1.3. of the rules on the “Credit Line for Productive Investment”, grant financing to SMEs under the conditions of this point.

1.5.5. Based on the granting of financing for the acquisition of goods and services referred to in the “AHORA 12” Program.

The requirement shall be reduced by an amount equivalent to 16% of the peso financing that the entity grants in accordance with the “AHORA 12” Program referred to in Joint Resolution No. 671/2014 and 267/2014 of the Ministry of Economy and Public Finance and the Ministry of Industry, respectively, whose purpose is the acquisition of goods and services included in said resolution and its complementary rules.

MINIMUM CASH B.C.R.A.
Section 1. Requirement.
Version: 8th COMMUNICATION “A” 5631
Validity:
01/10/2014

To this effect, the balance of the financing achieved from the period prior to the calculation period of the requirement that meet the stated requirements shall be considered.

This deduction, furthermore, shall not exceed 1% of the peso items subject to the requirement, on average, of the month prior to the calculation period.

The total decrease in the requirement - resulting from considering what is provided in points 1.5.1. to 1.5.5. jointly - shall not exceed the amount of the requirement previously determined.

1.6. Decrease in the requirement on average in US dollars, with effect for fixed-term deposits collected from 27.1.14.

Prior to the determination of the requirement, the monthly average of daily balances of the net position of Internal Letters of the Central Bank of the Argentine Republic in US dollars registered by the financial entity shall be deducted from the application base.

1.7. Specific increases in requirement due to liability concentration.

When an excessive concentration of liabilities (in titleholders and/or terms) is verified, which implies a significant risk regarding the individual liquidity of the financial entity and/or has an important negative effect on systemic liquidity, additional minimum cash requirements may be set on the liabilities included in the financial entity and/or those complementary measures deemed pertinent.

It will be considered that this situation is configured when, among others, any of the following factors are present:

• A high percentage of liabilities is concentrated in the same titleholder or titleholders.
• In term obligations, the term is short.
• The aforementioned liabilities represent a significant percentage with respect to the integration of the minimum cash and/or the total deposits of the private sector in the entity.

1.8. Transfers.

1.8.1. Admitted margin.

The integration of the minimum cash of the positions on average monthly or quarterly of daily balances of the obligations included shall not be less than 80% of the requirement resulting from the following expression:

EEMA (n) = EEF (n) + ENI (n-1)

Where

EEMA (n): adjusted minimum cash requirement corresponding to period “n”.

MINIMUM CASH B.C.R.A.
Section 1. Requirement.
Version: 7th COMMUNICATION “A” 5631
Validity:
01/10/2014

EEF (n): minimum cash requirement according to current rules corresponding to period “n”.

ENI (n-1): requirement not integrated in period “n-1”.

Period: month or quarter, as applicable.

1.8.2. Period of use.

The admitted transfer of the requirement not integrated in each period to the next position may be carried out for a maximum of six periods, counted from the first period (inclusive) in which the option to use it is chosen in accordance with the provisions above or from the first immediate position subsequent to that in which the transferred defects are compensated or charges are paid on them.

For its calculation, the transferred numerals of the period to which they correspond shall be computed, divided by the number of days of the period to which the transfer is made.

1.9. Defect in the application of resources in foreign currency.

The defect in the application of resources corresponding to deposits in foreign currency that is determined in a month shall be computed by an equivalent amount in the calculation of the minimum cash requirement of that same period of the respective currency.

1.10. Increase in the requirement due to non-compliance with the rules on “Credit Line for Productive Investment”.

The defect in the application of the 2013 Quota verified -on 1.7.13 or 1.1.14, as the case may be, when it concerns the first tranche and 1.1.14 or 1.7.14, as the case may be, when it concerns the second tranche- shall be computed by an equivalent amount in the calculation of the minimum cash requirement on average in pesos, from said dates and for 24 months.

The defect in the application of the 2014 Quota will generate an increase in the minimum cash requirement on average in pesos by an equivalent amount from the day following its verification (1.7.14 or 1.1.15) for 24 months.

1.11. Increase in the requirement due to non-compliance with the maximum rate level in financing subject to interest rate regulation by the B.C.R.A.

Non-compliance with the maximum limit for rates in financing subject to interest rate regulation by the B.C.R.A., in accordance with what is established in point 6.4. of Section 6. of the rules on “Interest Rates in Credit Operations”, will generate an increase in the minimum cash requirement in pesos by an amount equivalent to that obtained according to point 6.6.1. of Section 6. of said rules.

Without prejudice to this, financial entities may reverse that increase in accordance with the procedure established in point 6.7. of Section 6. of the rules on “Interest Rates in Credit Operations”.

MINIMUM CASH B.C.R.A.
Section 1. Requirement.
Version: 2nd COMMUNICATION “A” 5631
Validity:
01/10/2014

MINIMUM CASH
ORDERED TEXT ORIGIN NORM
Sec. Point Para. Com. Annex Sec. Point Para.
OBSERVATIONS
1.3.9. “A” 3498 only 1. 1.3.12. According to Com. “A” 3905, 3917,
3967, 4032, 4179, 4276,
4449, 4549, 4851, 5356,
5534 , 5555 and 5569.
1.3.10. “A” 3549 1.
1.3.11. “A” 3549 1. According to Com. “A” 4179, 4388,
4549, 4851, 5356, 5534,
5555 and 5569.
1.3.12. “A” 4179 2. According to Com. “A” 4406, 4449,
4707, 4851, 5356, 5534,
5555 and 5569.
1.3.13. “A” 4360 2. According to Com. “A” 5356.
1.3.14. “A” 4754 6. According to Com. “A” 5356.
1.4. “A” 3905 3. According to Com. “A” 4179, 4449
and 4473.
1.5. “A” 5356 2. According to Com. “A” 5471.
1.5.1. “A” 5356 2. According to Com. “A” 5471 and
5623.
1.5.2. “A” 5471 1. According to Com. “A” 5623.
1.5.3. “A” 5623 2.
1.5.4. “A” 5524
1.5.5. “A” 5631 1.
1.5. last “A” 5623 4. According to Com. “A” 5631.
1.6. “A” 5534 According to Com. “A” 5569.
1.7. “A” 3274 II 1. 1.5. According to Com. “A” 3498.
1.8. “A” 3274 II 1. 1.6.
1.8.1. “A” 3274 II 1. 1.6.1. According to Com. “A” 4405 and
4449.
1.8.2. “A” 3274 II 1. 1.6.2. According to Com. “A” 3304 and
4449.
1.9. “A” 3498 only 1. 1.8. According to Com. “A” 4147
1.10. “A” 5380 According to Com. “A” 5449 and
5516.
1.
1.11. “A” 5590 2.
2.1. “A” 3274 II 2. 2.1. According to Com. “A” 3498, 3597,
4716 (interpretation clarification),
4815 and “B” 9186.
2.1.1. “A” 3274 II 2. 2.1.2. According to Com. “A” 3304, 3498,
4016 and 4147.
2.1.2. “A” 3498 only 2. 2.1.3. According to Com. “A” 4147.
2.1.3. “A” 3274 II 2. 2.1.3. According to Com. “A” 3498, 4147,
4276 and 5194.
2.1.4. “A” 3274 II 2. 2.1.4.
2.1.5. “A” 4016 1.
2.1.6. “A” 4716 2. According to Com. “B” 9186.
2.
2.2. “A” 3274 II 2. 2.2. According to Com. “A” 3498, 4449,
4716 and 5299.

MINIMUM CASH
ORDERED TEXT ORIGIN NORM
Sec. Point Para. Com. Annex Sec. Point Para.
OBSERVATIONS
2.3. “A” 3365 2. According to Com. “A” 3387,
3470, 3498, 3549, 3597,
3732, 3824, 4016, 4449,
4716, 5152, 5299, 5373 and
“B” 9186.
2.4. “A” 4147 3. According to Com. “A” 4276,
4449, 4509, 5152 and 5299.
2.
2.5. “A” 4147 3. According to Com. “A” 4393,
4509, 4716 and 5299.
3.1. “A” 3274 II 3. 3.1.
3.1.1. “A” 3274 II 3. 3.1.1. According to Com. “A” 3326,
3365, 3498, 3549, 3905,
4276, 4449, 4473, 4707,
4716, 4862, 5356 and “B”
9186.
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. According to Com. “A” 4449.
3.2.2. “A” 3274 II 3. 3.2.2.2. According to Com. “A” 4449.
3.3. “A” 3274 II 3. 3.3. According to Com. “A” 3498.
3.3.1. “A” 3274 II 3. 3.3.1. According to Com. “A” 4771.
3.
3.3.2. “A” 3274 II 3. 3.3.2.
4. 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. According to Com. “A” 5356.
5.
5.3. “A” 3905 5. According to Com. “A” 4449.
6. 6.1.1. “A” 5246 3.
6.1.2. “A” 5312 According to Com. “A” 5333.