CMN Resolution No. 4194 — Establishes the optional methodology for calculating minimum Reference Equity, Tier 1, and Core Capital requirements for credit cooperatives opting for simplified risk-weighted assets

The Central Bank of Brazil, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the National Monetary Council, in an extraordinary session held on March 1, 2013, based on Articles 4, items VIII and XI, of the aforementioned Law, and Articles 1 and 12 of Complementary Law No. 130 of April 17, 2009,

R E S O L V E D:

CHAPTER I

OF THE OBJECT AND SCOPE OF APPLICATION

Article 1. This Resolution provides for the optional methodology for calculating the minimum requirements for Reference Equity (PR), Tier 1, and Core Capital and institutes the Core Capital Surcharge to be complied with by credit cooperatives that opt for the calculation of the amount of risk-weighted assets in simplified form (RWARPS).

CHAPTER II

OF THE REQUIREMENTS FOR CALCULATING THE RWARPS AMOUNT

Article 2. Credit cooperatives that opt for the calculation of the amount of risk-weighted assets in simplified form (RWARPS) may calculate the minimum requirements for Reference Equity (PR), Tier 1, and Core Capital, as defined in Resolution No. 4,192 of March 1, 2013, in the manner established in this Resolution.

§ 1. The Central Bank of Brazil may determine that a credit cooperative that has opted for the RWARPS amount calculation must calculate the minimum requirements for PR, Tier 1, and Core Capital and comply with the Core Capital Surcharge in the manner established by Resolution No. 4,193 of March 1, 2013, when it verifies incompatibility between the risks incurred and the method of calculating the minimum requirements.

§ 2. The procedures and parameters for calculating the RWARPS amount shall be established by the Central Bank of Brazil.

Article 3. The option for calculating the RWARPS amount is conditioned on compliance with the following requirements:

I - maintenance of total assets below R$100,000,000.00 (one hundred million reais), in the case of central credit cooperatives;

II - absence of sold or purchased exposure in gold, in foreign currency, in operations subject to exchange rate variation, to variation in commodity prices (commodities), to variation in stock prices, or in financial derivative instruments, except for investment in stocks registered in permanent assets;

III - absence of investment in credit securitization titles, except those issued by the National Treasury;

IV - absence of asset lending operations;

V - absence of committed operations, except:

a) sale operations with a commitment to repurchase with own assets; or

b) purchase operations with a commitment to resell with fixed-rate federal public titles, indexed to an interest rate or to a price index;

VI - investment in investment fund shares limited to funds that meet the following requirements:

a) observe the restrictions established in items II to V;

b) do not maintain exposures arising from credit operations; and

c) be classified, in accordance with the regulations of the Securities and Exchange Commission (CVM), as Short-Term Fund, Fixed Income Fund, Referenced Fund whose performance indicator is the Interbank Deposit Rate (DI), or Investment Fund in Shares of Investment Funds classified as one of the three modalities mentioned in this item; and

VII - non-existence of affiliated institutions that do not meet the requirements mentioned in items I to VI, in the case of central credit cooperatives.

Article 4. For the purpose of verifying compliance with the requirement established in Article 3, item I, the following must be considered:

I - for a central credit cooperative in the initial stage of activity, the total assets on the base date of the start of operations; and

II - for a central credit cooperative resulting from processes of spin-off or merger subsequent to the entry into force of this Resolution, the total assets on the first base date after the effective implementation of these events.

Article 5. Credit cooperatives that opt for the calculation of the RWARPS amount must permanently maintain amounts of PR, Tier 1, and Core Capital in values higher than the minimum requirements established in this Resolution.

CHAPTER III

OF THE MINIMUM REQUIREMENT FOR REFERENCE EQUITY

Article 6. The minimum requirement for PR for the credit cooperative that opts for the calculation of the RWARPS amount corresponds to:

I - 10.5% (ten and five-tenths percent) of the RWARPS amount, for a singular credit cooperative affiliated to a central cooperative;

II - 11.5% (eleven and five-tenths percent) of the RWARPS amount, for a central cooperative; and

III - 15.5% (fifteen and five-tenths percent) of the RWARPS amount, for a singular credit cooperative not affiliated to a central cooperative.

CHAPTER IV

OF THE MINIMUM REQUIREMENT FOR TIER 1

Article 7. The minimum requirement for Tier 1 for the credit cooperative that opts for the calculation of the RWARPS amount corresponds to:

I - 8.5% (eight and five-tenths percent) of the RWARPS amount, for a singular credit cooperative affiliated to a central cooperative;

II - 9.5% (nine and five-tenths percent) of the RWARPS amount, for a central cooperative; and

III - 13.5% (thirteen and five-tenths percent) of the RWARPS amount, for a singular credit cooperative not affiliated to a central cooperative.

CHAPTER V

OF THE MINIMUM REQUIREMENT FOR CORE CAPITAL

Article 8. The minimum requirement for Core Capital for the credit cooperative that opts for the calculation of the RWARPS amount corresponds to:

I - 7% (seven percent) of the RWARPS amount, for a singular credit cooperative affiliated to a central cooperative;

II - 8% (eight percent) of the RWARPS amount, for a central cooperative; and

III - 12% (twelve percent) of the RWARPS amount, for a singular credit cooperative not affiliated to a central cooperative.

CHAPTER VI

OF THE CORE CAPITAL SURCHARGE

Article 9. The Core Capital Surcharge specific to the credit cooperative that opts for the calculation of the RWARPS amount is instituted, in the value of 2.5% (two and five-tenths percent) of the RWARPS amount.

Article 10. The insufficiency in complying with the Core Capital Surcharge causes impediment to:

I - payment of variable remuneration to directors and members of the board of directors;

II - payment of net surpluses accrued and annual remuneration to quota-holders; and

III - redemption of quota-holders.

§ 1. The impediment mentioned in the main text:

I - must be imposed while the insufficiency of Core Capital Surcharge verified persists; and

II - applies to insufficiencies observed when calculating the values to be paid, including those eventually advanced.

§ 2. The variable remuneration mentioned in item I of the main text includes bonuses and any deferred remuneration parcels and other incentive remunerations associated with performance.

§ 3. Net surpluses distributed and not paid in the social year due to insufficiency in complying with the Core Capital Surcharge shall be incorporated into the reserves of the credit cooperative or, alternatively, to its capital, if so decided by the shareholders' meeting.

Article 11. The amounts not paid due to insufficiency of Core Capital Surcharge cannot be the object of future obligation.

Article 12. The excess value of Core Capital relative to the minimum requirement set forth in Article 8 used to meet the minimum requirements provided for in Articles 6 or 7 cannot be considered for verifying the sufficiency of the Core Capital Surcharge.

CHAPTER VII

OF THE DEDUCTION OF EXCESS FIXED ASSETS

Article 13. For the purpose of verifying compliance with the minimum requirements mentioned in Articles 6, 7, and 8, as well as the Core Capital Surcharge mentioned in Article 9, the eventual excess of resources applied in Permanent Assets relative to the percentages established in Articles 3 and 4 of Resolution No. 2,283 of June 5, 1996, with the wording given by Resolution No. 2,669 of November 25, 1999, must be deducted from PR, Tier 1, and Core Capital.

CHAPTER VIII

OF THE COMMUNICATION OF THE OPTION FOR CALCULATING RWARPS

Article 14. The credit cooperative must communicate in advance to the Central Bank of Brazil when it opts for the calculation of the RWARPS amount or withdraws this option, observing that:

I - the option or withdrawal must be approved by the institution's board of directors; and

II - the option for calculating the RWARPS amount requires compliance with the minimum requirements listed in Article 3, prior to communication, except for the situations provided for in Article 16.

Sole Paragraph. The communication mentioned in the main text is waived for the credit cooperative that, on the date of entry into force of this Resolution, is using the facility of calculating the simplified portion regarding exposures weighted by the risk weighting factor attributed to them (simplified portion PSPR) of the Required Reference Equity (PRE), in accordance with Article 2, § 4, of Resolution No. 3,490 of August 29, 2007, and opts for the calculation of the RWARPS amount.

Article 15. The credit cooperative that fails to calculate the RWARPS amount in accordance with this Resolution is prohibited from exercising the option provided for in Article 2 for a minimum period of twelve months, counted from the confirmation of receipt by the Central Bank of Brazil of the communication referred to in Article 14.

§ 1. The calculation of the RWARPS amount before the minimum period established in the main text has elapsed must be authorized by the Central Bank of Brazil.

§ 2. The compliance with the requirements established in Article 3, items II to VI, must be maintained:

I - until the authorization mentioned in § 1 of this article is granted, if applicable; or

II - until the confirmation of receipt of the communication referred to in the main text by the Central Bank of Brazil, in other cases.

Article 16. The credit cooperative that, on the date of entry into force of this Resolution, is using the facility of calculating the simplified portion PSPR of the PRE, in accordance with Article 2, § 4, of Resolution No. 3,490 of 2007, even if not meeting the minimum requirements established in Article 3, items II to VI, of this Resolution, may calculate the RWARPS amount and calculate the minimum requirements for PR, Tier 1, and Core Capital mentioned in Articles 6, 7, and 8 of this Resolution, provided it submits to the approval of the Central Bank of Brazil an adequacy plan intended to meet the requirements established in Article 3, items II to VII, of this Resolution.

Sole Paragraph. The plan mentioned in the main text must contain a schedule and quantitative targets.

CHAPTER IX

OF FINAL PROVISIONS

Article 17. The credit cooperative that opts for the calculation of the RWARPS amount must:

I - disclose, in the manner established by the Central Bank of Brazil, the minimum information related to the calculation of this amount; and

II - indicate to the Central Bank of Brazil a director responsible for the processes and controls related to the calculation of the RWARPS amount, for the calculation of the minimum requirements for PR, Tier 1, and Core Capital, and for compliance with the Core Capital Surcharge.

Sole Paragraph. For the purposes of the responsibility mentioned in item II, it is admitted that the indicated director performs other functions in the institution, except those related to the administration of third-party resources or others that may imply conflicts of interest or represent a deficiency in the segregation of functions.

Article 18. For the credit cooperative that opts for the calculation of the RWARPS amount, the citations and the validity basis of normative acts issued based on Resolution No. 3,490 of 2007 and on the normative acts revoked by it shall henceforth have this Resolution as reference.

Article 19. This Resolution enters into force on October 1, 2013.

Article 20. Resolution No. 3,897 of August 25, 2010 is revoked, effective from October 1, 2013.

                    Alexandre Antonio Tombini President of the Central Bank of Brazil