CMN Resolution No. 4700 - Amends Resolution No. 4,222 of May 23, 2013 and its Annex I - Statute of the Credit Guarantee Fund (FGC) to establish criteria for the election of members of the Board of Directors and the Executive Board of the Fund

The Central Bank of Brazil, pursuant to Article 9 of Law No. 4,595 of December 31, 1964, makes public that the National Monetary Council, in a session held on November 27, 2018, based on Articles 3, item VI, and 4, item VIII, of said Law, and taking into account the provisions of Paragraph 1 of Article 28 of Complementary Law No. 101 of May 4, 2000, and Paragraph 1, item XIII, of Article 1 of Complementary Law No. 105 of January 10, 2001,

RESOLVES:

Article 1. Resolution No. 4,222 of May 23, 2013, shall enter into force with the following alteration:

“Article 2. The ordinary monthly contribution of institutions affiliated with the FGC is 0.01% (one hundredth percent) of the amount of account balances related to the instruments listed in items I to IX of Article 2 of Annex II, even if the corresponding credits are not covered by the ordinary guarantee.” (NR)

Article 2. Annex I to Resolution No. 4,222 of 2013 shall enter into force with the following alterations:

“Article 24. .......................................................

I - the election shall be made by voting on slates, containing the names of candidates for titular or alternate members of the Board of Directors for all positions in dispute, which must be registered at the electoral table as soon as the General Assembly publishes the quantity of positions in dispute;

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Paragraph 1. The conditions to be a member of the Board of Directors are:

I - to have an impeccable reputation;

II - not to be barred by special law, nor convicted of bankruptcy crime, tax evasion, malfeasance, active or passive corruption, extortion, embezzlement, against the popular economy, against public faith, against property, or against the National Financial System, or sentenced to a criminal penalty that bars, even temporarily, access to public office;

III - not to be declared ineligible or suspended from exercising positions of fiscal councilor, administration councilor, director, or managing partner in financial institutions and other institutions authorized to operate by the Central Bank of Brazil or in pension fund entities, insurance companies, capitalization societies, publicly held companies, or entities subject to supervision by the Securities and Exchange Commission;

IV - not to be liable, nor any company of which they are controller or administrator, for non-compliance with liquid, certain, and due monetary obligations;

V - not to be declared bankrupt or insolvent; and

VI - not to have controlled or administered, in the two years preceding the election, a firm or society subject to a declaration of insolvency, extrajudicial liquidation, intervention, special temporary administration regime, bankruptcy, or judicial reorganization.

Paragraph 2. To evaluate compliance with the requirement set forth in item I of Paragraph 1, the following situations and occurrences must be taken into consideration:

I - criminal process with accepted indictment, regarding the crimes mentioned in item II of Paragraph 1, to which the candidate for the position is responding, or any society of which they were or had been, at the time of the facts, controller or administrator;

II - judicial process related to the National Financial System, the Brazilian Payments System, the Securities Distribution System, the National Insurance, Capitalization, Reinsurance, and Open Pension Fund System, or the Closed Pension Fund System;

III - ineligibility for exercising public office by internal or external control bodies within the Federal, State, or Municipal Public Administration;

IV - punishment for serious misconduct related to the breach of Code of Ethics, Conduct, or other similar corporate normative instruments in the institutions where they acted; and

V - other situations, occurrences, or analogous circumstances deemed relevant by the General Assembly.

Paragraph 3. Observing the provisions of Paragraph 1, candidates for member of the Board of Directors must:

I - have held a position of senior management or advisory role in affiliated institutions or in regulatory bodies of the National Financial System, the Brazilian Payments System, the Securities Distribution System, the National Insurance, Capitalization, Reinsurance, and Open Pension Fund System, or the Closed Pension Fund System; or

II - possess notable knowledge of the financial market and the National Financial System and its protection network.

Paragraph 4. As a means to ensure governance practices and management segregation, including those referred to in items I and II of Article 25, candidates for member of the Board of Directors must have their names evaluated and presented, prior to the General Assembly convened to elect them, by an institution or company with notable specialization, experience, and reputation in recruiting and selecting occupants for positions of this nature in the country or abroad, contracted at the expense of the FGC.” (NR)

“Article 30. The Executive Board, composed of two to five directors, one of whom is the executive director and the others without specific designation, shall be elected by the Board of Directors for a term of three years, with reelection permitted.

Paragraph 1. The provisions of Paragraphs 1 to 3 of Article 24 and items I and II of Article 25 apply to the members of the Executive Board, with the Board of Directors responsible for evaluating the provision in item V of Paragraph 2 of Article 24, when applicable.

Paragraph 2. The management term of the Executive Board shall extend until the investiture of the newly elected directors.” (NR)

Article 3. The following are repealed:

I - the sole paragraph of Article 24 of Annex I to Resolution No. 4,222 of 2013; and

II - items I and II of the caput of Article 30 of Annex I to Resolution No. 4,222 of 2013.

Article 4. This Resolution enters into force on the date of its publication.

Ilan Goldfajn
President of the Central Bank of Brazil