CMN Resolution No. 345 — Lowers Standards for Compliance with Senate Federal Resolution No. 62/1975

RESOLUTION NO. 000345

The CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595, of December 31, 1964, makes it known that the NATIONAL MONETARY COUNCIL, in a session held on November 12, 1975, having regard to the provisions of Resolution No. 62/75, of October 28, 1975, of the Federal Senate,

HAS DECIDED:

I - To comply with the determinations contained in Resolution No. 62/75 of the Federal Senate, the States and Municipalities must send to the Central Bank, by the 30th day of each month, demonstrative tables showing the position of their commitments, as well as those of their autonomous entities, for the previous month, discriminating:

a) the consolidated debt;

b) the floating debt, highlighting operations carried out to anticipate revenue authorized in the annual budget;

c) the guarantees and sureties granted, distinguishing those included in the calculation of consolidated debt from others;

d) obligations of any other nature, including promissory notes.

II - The tables referred to in the preceding item must indicate the characteristics of each commitment assumed, the redemptions and increases occurring during the period, as well as the schedule of their maturities.

III - For the purposes of § 1 of Article 2 of Resolution No. 62/75 of the Federal Senate, the following are not included as consolidated debt: guarantees offered by the States or Municipalities to:

a) their autonomous entities; and

b) other entities that demonstrate, at the discretion of the Central Bank, effective conditions to settle their respective commitments.

IV - In addition to the tables mentioned in item I, the States, Municipalities, and their respective autonomous entities must send to the Central Bank, at the beginning of each year, a copy of the General Balance Sheet relating to the previous financial year.

V - In the event provided for in Article 3 of Resolution No. 62/75 of the Federal Senate, the technical justification required therein must be sent to the Central Bank for presentation to the National Monetary Council, at least 60 (sixty) days in advance of the date scheduled for the intended exceptional contracting or issuance.

VI - The registration of public debt securities referred to in Article 4 of Resolution No. 62/75 of the Federal Senate must be processed annually and will depend on the submission to the Central Bank of the following information:

a) the total value of the issuance for the fiscal year, discriminating the planned monthly placements;

b) characteristics of the securities (name, type, numbering and series, with indication of their respective terms, etc.);

c) interest rate, its payment periodicity, monetary correction clause, if any, and other placement conditions in the market;

d) maturity schedule of securities in circulation, discriminating the quantity and values to be redeemed month by month;

e) legislative authorization for the issuance;

f) copy of the Budget Law of the current fiscal year;

g) other data deemed useful.

VII - For the purpose of the provision in § 3 of Article 4 of Resolution No. 62/75 of the Federal Senate, registration requests must be accompanied by their respective application plans, so that the Central Bank may submit them to the Planning Secretariat of the Presidency of the Republic.

VIII - Upon receipt of the manifestation of the Planning Secretariat of the Presidency of the Republic regarding the application plan, the Central Bank must, within a maximum period of 30 (thirty) days, rule on registration requests that do not result in an increase in the volume of securities in circulation.

IX - The running of the period provided for in item VIII will be interrupted if the Central Bank requests additional clarifications, restarting another period of 30 (thirty) days from the receipt of the new information.

X - Registration requests that foresee an increase in the volume of securities in circulation will be submitted to the National Monetary Council, in which case the period mentioned in items VIII and IX will be 60 (sixty) days.

XI - Regarding the registration of securities with a maturity of less than 12 (twelve) months, the following conditions must also be observed:

a) the issuance of these securities will only be permitted for the redemption of those of equal term in circulation;

b) under no circumstances may the volume existing on October 29, 1975, the date of commencement of the validity of Resolution No. 62/75 of the Federal Senate, be exceeded.

XII - Securities issued by States and Municipalities cannot, when in circulation, exceed the registered limit, and any alterations to be processed in the information presented upon registration will necessarily require prior consultation with the Central Bank.

XIII - Institutions comprising the distribution system for securities and financial assets will inform the Central Bank, by the 10th day of each month, of the amount, nature, and characteristics (including term and profitability) of state and municipal securities negotiated through their intermediation in the previous month, specifying the amount of primary placements of papers.

XIV - If any irregularity is found in compliance with the aforementioned Resolution No. 62/75 of the Federal Senate, the Central Bank, independent of the application of legal sanctions within its jurisdiction, regarding the responsibility of intervening financial institutions, will communicate the occurrence to the National Monetary Council, so that this body, through the Minister of Finance, submits it to the President of the Republic, with a view to the action of the Union, relative to the responsible State or Municipality, in accordance with the Federal Constitution.

XV - The Central Bank will issue complementary instructions necessary for the execution of this Resolution.

XVI - Resolution No. 313, of November 19, 1974, is hereby revoked.

Brasília-DF, November 13, 1975

Paulo H. Pereira Lira
President