CMN Resolution No. 4195 — Provisions on the Preparation and Submission of the Analytical Balance Sheet – Prudential Conglomerate

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 Article 4, items VIII and XII, of the aforementioned Law, and considering the provisions of Article 61 of Law No. 11,941 of May 27, 2009,

R E S O L V E D:

Article 1. Financial institutions and other institutions authorized to operate by the Central Bank of Brazil, except credit cooperatives, must prepare an Analytical Balance Sheet in a consolidated manner, including data related to the entities listed below, located in the country or abroad, over which the institution holds direct or indirect control:

I - financial institutions;

II - other institutions authorized to operate by the Central Bank of Brazil;

III - consortium administrators;

IV - payment institutions that act as issuers or credit card acquirers;

V - companies that carry out the acquisition of credit operations, including real estate, or credit rights, such as merchant finance companies, securitization companies, and special purpose companies;

VI - insurance companies, reinsurance companies, capitalization companies, and open complementary pension entities;

VII - investment funds in which the entities comprising the conglomerate, in any form, assume or retain substantially risks and benefits, such as exclusive investment funds, investment funds in credit rights, and other financial investment funds; and

VIII - other legal entities headquartered in the country whose exclusive corporate purpose is shareholding in the entities mentioned in items I to VI.

Sole Paragraph. The Analytical Balance Sheet mentioned in the caput must be:

I - named Analytical Balance Sheet – Prudential Conglomerate; and

II - prepared and submitted monthly to the Central Bank of Brazil.

Article 2. For the purposes of this Resolution, the existence of control is characterized by:

I - shareholdings in companies located in the country or abroad in which the institution holds, directly or indirectly, alone or together with other partners, including due to the existence of voting agreements, partner rights that ensure preponderance in social deliberations or the power to elect or dismiss the majority of administrators; or

II - effective operational control, characterized by common administration or management or by acting in the market under the same brand or trade name.

Article 3. The shareholdings of the institutions referred to in Article 1 in which there is shared control must be consolidated proportionally to the share held by the institution.

Article 4. The Analytical Balance Sheet – Prudential Conglomerate must be subject to examination and a semi-annual report by independent auditors, on the base dates of June 30 and December 31.

Article 5. The institutions mentioned in Article 1, in the preparation of the Analytical Balance Sheet – Prudential Conglomerate, must:

I - apply all definitions and criteria for the valuation and recognition of assets, liabilities, revenues, and expenses provided for in the regulation embodied in the Accounting Plan of the Institutions of the National Financial System (Cosif); and

II - make the necessary adjustments so that the valuation and recognition of assets, liabilities, revenues, and expenses of entities not subject to Cosif rules reflect the provisions of the regulation concerning this Accounting Plan.

Article 6. The Central Bank of Brazil will regulate the additional procedures to be observed in the preparation and submission of the Analytical Balance Sheet – Prudential Conglomerate, including provisions on the form and content, as well as the means of submission of this balance sheet.

Article 7. In order to avoid distortions in the qualitative and quantitative representation of consolidated equity, the Central Bank of Brazil, considering the concrete situation of the prudential conglomerate, may determine the inclusion or exclusion of entities in the preparation of the Analytical Balance Sheet governed by this Resolution.

Article 8. The Central Bank of Brazil may, without prejudice to other applicable measures, determine a new preparation and submission of the Analytical Balance Sheet – Prudential Conglomerate, with the necessary corrections, for the adequate expression of the economic and financial reality of the entity.

Article 9. The provisions of this Resolution regarding the preparation and submission to the Central Bank of Brazil of the Analytical Balance Sheet – Prudential Conglomerate do not apply to consortium administrators, who will follow the accounting rules issued by the Central Bank of Brazil, in the exercise of its legal competence.

Article 10. This Resolution enters into force on July 1, 2013.

Alexandre Antonio Tombini
President of the Central Bank of Brazil