Circular REMON 1 - 960: Minimum Cash Requirements Adjustments

2018 - YEAR OF THE CENTENARY OF THE UNIVERSITY REFORM

COMMUNICATION “A” 6616
20/12/2018

TO FINANCIAL INSTITUTIONS:

Ref.: Circular
REMON 1 - 960

Minimum cash. Adjustments.

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We address you to inform you that this Institution adopted the resolution that, in its pertinent part, provides:

“1. Replace, with the validity indicated in point 2. of this communication, point 1.3. of the rules on “Minimum cash” with the following:

“1.3. Minimum cash.

The minimum cash amounts arising from applying the following rates must be integrated, depending on whether they are: i) entities included in Group “A” –in accordance with the provisions of Section 4. of the rules on “Authorities of financial entities”– and branches or subsidiaries of foreign banks qualified as systemically important (G-SIB) not included in that group or ii) the remaining financial entities:

Concept	Rates in %
	Group “A” and G-SIB not included in that group	Remaining entities
1.3.1. Deposits in current accounts and demand accounts opened in cooperative credit banks.	45	20
1.3.2. Deposits in savings accounts, salary/social security and special accounts –with the exception of deposits included in points 1.3.7. and 1.3.11.–, other demand deposits and obligations, pension assets credited by ANSES pending effective payment and immobilized balances corresponding to obligations included in these rules.
1.3.2.1. In pesos.	45	20
1.3.2.2. In foreign currency.	25	25
1.3.3. Unused balances of formalized current account advances.	45	20

1.3.4.
Deposits in current accounts of non-bank finan- cial entities, computable for the integration of their minimum cash.
100
100

1.3.5. Fixed-term deposits, obligations for “acceptances” –including liabilities for sale or assignment of credits to subjects other than financial entities–, passive repos, collateral and passive stock market repos, constant-term investments, with option of early cancellation or renewal for a determined term and –with variable remuneration, and other term obligations with the exception of deposits included in points 1.3.7. to 1.3.10. and 1.3.12. – and debt securities (including negotiable obligations), according to their residual term:

1.3.5.1. In pesos.

i) Up to 29 days.	35	14
ii) From 30 to 59 days.	25	10
iii) From 60 to 89 days.	7	5
iv) From 90 days or more.	0	0

1.3.5.2. In foreign currency.

i) Up to 29 days.	23	23
ii) From 30 to 59 days.	17	17
iii) From 60 to 89 days.	11	11
iv) From 90 to 179 days.	5	5
v) From 180 to 365 days.	2	2
vi) More than 365 days.	0	0

1.3.6. Liabilities for financial lines from abroad (does not include those instrumented through time deposits –except when made by residents abroad related to the entity in accordance with Section 2. of the rules on “Credit risk splitting”– nor the acquisition of debt securities, to which the requirement provided in point 1.3.5. applies), according to their residual term:

i) Up to 29 days.	23	23
ii) From 30 to 59 days.	17	17
iii) From 60 to 89 days.	11	11
iv) From 90 to 179 days.	5	5
v) From 180 to 365 days.	2	2
vi) More than 365 days.	0	0

1.3.7. Demand and fixed-term deposits made by order of the Justice with funds originating from the

cases in which it intervenes, and their immobilized bal- ances.

1.3.7.1. In pesos.	32	13
1.3.7.2. In foreign currency.	15	15
1.3.8. Special deposits linked to the inflow of funds from abroad - Decreto 616/05.	100	100
1.3.9. Term investments instrumented in non-transferable registered certificates, in pesos, corresponding to public sector holders that have the right to exercise the early cancellation option within a term of less than 30 days counted from their constitution.	35	14
1.3.10. Deposits and term investments of “UVA” and “UVI” –including savings accounts and debt securities (including negotiable obligations) in “UVA” and “UVI”–, according to their residual term.
i) Up to 29 days.	7	7
ii) From 30 to 59 days.	5	5
iii) From 60 to 89 days.	3	3
iv) From 90 or more.	0	0
1.3.11. Labor Cessation Fund for Workers of the Construction Industry in UVA.	7	7
1.3.12. Deposits and term investments constituted in the name of minors with funds received free of charge.	0	0

1.3.13. In the case of transactions in pesos, when the locality in which the operating office where they are carried out is located, in accordance with the provisions of the rules on “Categorization of localities for financial institutions”, belongs to categories II to VI, the rates provided for demand placements shall be reduced by 2 percentage points and for term placements by 1 percentage point up to a minimum of zero (including point 1.3.11.). In both cases, it does not include deposits in securities.

1.3.14. Financial institutions included in Group “A” and branches or subsidiaries of G-SIBs not included in that group may integrate the peso requirement –for the period and daily– with “Bonos del Tesoro Nacional en pesos a tasa fija vencimiento noviembre de 2020” up to:

a) 5 percentage points of the rates provided in points 1.3.1., 1.3.2.1., 1.3.3., subsections i) and ii) of point 1.3.5.1. and points 1.3.7.1. and 1.3.9.

b) 2 percentage points of the rate provided in subsection iii) of point 1.3.5.1.

1.3.15. Financial institutions included in Group “A” and branches or sub-
sidiaries of G-SIBs not included in that group may integrate the requirement in pe- sos –for the period and daily– with BCRA Liquidity Bills (LELIQ) and/or BCRA Notes (NOBAC) up to 13 percentage points of the rate provided in subsection i) of point 1.3.5.1. and 1.3.9.; up to 10 percentage points of the ra- tes provided by points 1.3.1., 1.3.2.1. and 1.3.3. and subsection ii) of point
1.3.5.1. and point 1.3.7.1.

For the integration with “Bonos del Tesoro Nacional en pesos a tasa fija vencimiento noviembre de 2020”, LELIQ and/or NOBAC as provided in points 1.3.14. and 1.3.15. to be admitted, they must be valued at market prices and be deposited in Subaccount 60 cash minimum enabled in the “Central de Registro y Liquidación de Pasivos Públicos y Fideicomisos Financieros - CRyL”.”

2. To provide that point 1. above shall be effective as of 1.2.19 for institutions included in Group “A” –in accordance with the provisions of Section 4. of the rules on “Authorities of financial institutions”– and branches or subsidiaries of foreign banks qualified as systemically important (G-SIB) not included in that group, and as of 1.1.19 for the remaining financial institutions.

As of the corresponding effective date –according to the group to which the institution belongs– it may not make use of the integration modality provided in point 2. of Communication “A” 6575 –which admits the integration in LELIQ and/or NOBAC of the requirement due to the increase in the balances of certain term placements with respect to 30.9.18–.

3. To replace, with effect from 1.1.19, the second paragraph of point 2.3. of the rules on “Cash minimum” with the following:

“Said daily requirement shall be 50 % when in the previous month an integration deficiency higher on average than the admitted transfer margin has been recorded.”

Likewise, we inform you that we will subsequently send you the sheets that, replacing those previously provided, should be incorporated into the reference rules.

We greet you attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Darío C. Stefanelli
Principal Manager of Issuance and
Regulatory Applications
Agustín Torcassi
Deputy General Manager of Rules