Communication A 6526: Minimum Cash, Credit Risk Splitting, Credit Policy and Net Global Foreign Currency Position Adjustments

2018 - YEAR OF THE CENTENARY OF THE UNIVERSITY REFORM

COMMUNICATION “A” 6526
18/06/2018

TO FINANCIAL INSTITUTIONS:

Ref.: Circular
REMON 1 - 943
LISOL 1 - 799
OPRAC 1 - 949

Minimum cash. Splitting of credit risk. Credit policy. Net global position in foreign currency. Adjust- ments . ____________________________________________________________

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

“1. Replace, with effect from 21.6.18, points 1.3.1., 1.3.2.1., 1.3.3.1., 1.3.4.1., 1.3.5., 1.3.7.1., subsection a) of point 1.3.9., points 1.3.11.1. and 1.3.13. of the rules on “Minimum cash” with the following:

1.3.1. Deposits in current accounts and demand accounts opened in cooperative credit banks.	23	21
1.3.2.1. In pesos.	23	21
1.3.3.1. In pesos.	23	21
1.3.4.1. In pesos.	23	21
1.3.5. Unused balances of formalized current account advances.	23	21
1.3.7.1. In pesos.
i) Up to 29 days.	17	16
ii) From 30 to 59 days.	13	12
iii) From 60 to 89 days.	6	5
iv) From 90 to 179 days.	1	0
v) From 180 days or more.	0	0
1.3.9. Debt securities (including negotiable obligations), according to their residual term:
a) In pesos.
i) Up to 29 days.	17	17
ii) From 30 to 59 days.	13	13
iii) From 60 to 89 days.	6	6

BANCO CENTRAL
OF THE ARGENTINE REPUBLIC

iv) From 90 to 179 days.	1	1
v) 180 days or more.	0	0
1.3.11.1. In pesos.	16	16
1.3.13. 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 period of less than 30 days counted from their constitution.	19	18”

2. Replace, with effect from 18.7.18, points 1.3.1., 1.3.2.1., 1.3.3.1., 1.3.4.1., 1.3.5., 1.3.7.1., subsection a) of point 1.3.9., points 1.3.11.1. and 1.3.13. of the rules on “Minimum Cash” with the following:

“1.3.1. Demand deposits and sight accounts opened in cooperative credit banks.	25	23
1.3.2.1. In pesos.	25	23
1.3.3.1. In pesos.	25	23
1.3.4.1. In pesos.	25	23
1.3.5. Unused balances of formalized overdrafts.	25	23
1.3.7.1. In pesos.
i) Up to 29 days.	19	18
ii) From 30 to 59 days.	15	14
iii) From 60 to 89 days.	7	6
iv) From 90 to 179 days.	1	0
v) 180 days or more.	0	0
1.3.9. Debt securities (including negotiable obligations), according to their residual term:
a) In pesos.
i) Up to 29 days.	19	19
ii) From 30 to 59 days.	15	15
iii) From 60 to 89 days.	7	7
iv) From 90 to 179 days.	1	1
v) 180 days or more.	0	0
1.3.11.1. In pesos.	18	18
1.3.13. 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 period of less than 30 days counted from their constitution.	21	20”

3. Provide that the requirement resulting from applying in each position the increase in minimum cash
   reserve rates in pesos -for the period and daily- provided in the preceding points with respect to those in force as of 15.6.18 may be integrated by means of National Treasury Bonds in pesos at a fixed rate with maturity in November 2020 valued at market price deposited in Subaccount 60 minimum cash reserve enabled in the “Central de Registro y Liquidación de Pasivos Public and Financial Trusts - CRyL”

4. Establish that the National Treasury Bonds in pesos at a fixed rate with maturity in Novem-
   ber 2020 that are applied to the integration of the minimum cash reserve in that currency shall be ex- cluded from the limits provided in the rules on “Credit risk fractionalization”.

5. Replace point 2.1.14. of the rules on “Credit policy” with the following:

“2.1.14. Debt instruments in foreign currency of the National Treasury, for up to the amount equivalent to one third of the total applications made in accordance with the provisions in this section.”

6. Replace, with effect from 18.6.18, the first paragraph of point 2.2. of the rules on “Net global
   foreign currency position” with the following:

“This daily position –daily balance converted to pesos at the reference exchange rate of the close of the month prior to the computation of this ratio– may not exceed 5% of the RPC or the liq- uid own resources, both from the month prior to the corresponding one, whichever is lower.”

7. Admit from 18.6.18 that the positive net global foreign currency position may reach
   up to 30% of the RPC or the liquid own resources -whichever is lower-, as long as the total excess with respect to the general limit originates solely as a consequence of:

a) increase in the position in National Treasury bills in US dollars with respect to those held as of 15.6.18, and/or

b) position in National Treasury bills in US dollars as of 15.6.18 held in excess of the limit in force at that date by application of point 4.1. of the rules on “Net global foreign currency position”.

8. Leave without effect from 18.6.18 point 4.1. of the rules on “Net global
   foreign currency position”, without prejudice to its computation for the purposes of the admitted excess provided in the preceding point.”

Likewise, we inform you that we will subsequently send you the sheets that, in re-placement of those opportunely provided, will correspond to be incorporated in the reference rules.

We greet you attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Darío C. Stefanelli
Senior Issuance Manager and
Aplicaciones Normativas

Agustín Torcassi
Subgerente General de Normas