CENTRAL BANK OF THE ARGENTINE REPUBLIC

____________________________________________________________________________ COMMUNICATION " A " 3086 I 16/03/00 ____________________________________________________________________________

TO THE FINANCIAL INSTITUTIONS:

Ref.: Circular RUNOR - 1 - 384
OPRAC - 1 - 481
Complementary services of the financial activity and permitted activities. Ordered text.

We address you to inform you that this Institution adopted, on the subject of reference, the following resolution:

"1. Approve the rules on “Complementary services of the financial activity and permitted activities” that appear in the annex that forms part of this communication.

2. Establish that financial institutions must inform the Superintendence of Financial and Exchange Institutions no later than 31.3.00, of the holdings acquired prior to the effective date of Communication "A" 2384 (17.10.95) that exceed the limit of 12.5% of the capital stock or votes of the companies, or lower percentages if this is sufficient to form the corporate will, whose corporate purpose is not complementary to the financial activity, in accordance with the list of activities included in point 2.2. of Section 2. of the rules on "Complementary services of the financial activity and permitted activities" or that is not compatible with the class of entity.”

Consequently, we send you the ordered text as of the date of the aforementioned rules.

Likewise, an indicative table of the origin of the provisions included in said ordering is attached.

We greet you very attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Juan Carlos Isi
Alfredo A. Besio
Deputy Manager of
Manager of Rules for
Regulatory Regime
Financial Institutions

ANNEX: 8 sheets

B.C.R.A. ORDERED TEXT OF THE RULES ON COMPLEMENTARY SERVICES OF THE FINANCIAL ACTIVITY AND PERMITTED ACTIVITIES

- Index -

Section 1. General concepts.

1.1. Prohibition.

1.2. Operation on own account.

Section 2. Complementary services.

2.1. Scope.

2.2. Activities included.

2.3. Authorization.

2.4. Cases that do not require authorization. Information.

2.5. Consolidated basis.

Section 3. Other permitted activities.

3.1. Activities on own account.

3.2. Through other companies.

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COMPLEMENTARY SERVICES OF THE FINANCIAL ACTIVITY AND B.C.R.A. PERMITTED ACTIVITIES
Section 1. General concepts.

1.1. Prohibition.

Financial institutions are not authorized to carry out -whatever their modality- operations unrelated to financial intermediation, in accordance with the provisions contained in Title II of the Law on Financial Institutions.

Consequently, the operation on own account of all industrial, agricultural, commercial and any other non-financial activities is prohibited, except those specifically permitted by the Central Bank of the Argentine Republic.

1.2. Operation on own account.

The expression "operate on own account" referred to in subsection a) of article 28 of the Law on Financial Institutions, is inclusive of any non-financial activity that is carried out by itself or through a company in which the financial institution holds, directly or indirectly, a shareholding.

It will be understood that this situation is configured when the holding exceeds 12.5% of the capital stock of the company or 12.5% of the votes or, in cases where the percentages are lower, when the holding grants the necessary votes to form the corporate will in the shareholders' meetings or to adopt decisions in board meetings or similar body.

It will also be considered that operation on own account exists, when such activities are intended to be carried out in compliance with mandates conferred by third parties, whatever their relationship or link to the entity.

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B.C.R.A.	COMPLEMENTARY SERVICES OF THE FINANCIAL ACTIVITY AND PERMITTED ACTIVITIES
	Section 2. Complementary services.

2.1. Scope.

Commercial banks and financial companies may hold equity interests in domestic or foreign companies whose exclusive purpose is the activities mentioned in point 2.2., exceeding 12.5% of the share capital or of the total votes or lower percentages if this is sufficient to form the corporate will in the shareholders' meetings or board meetings of said companies, subject to compliance with the provisions contained in points 2.3. or 2.4., as applicable.

In the cases of the other banks, savings and loan associations for housing or other real estate, and credit unions, such interests may be maintained to the extent that the nature of the activity is compatible with the type of entity, according to the operations authorized in the Financial Entities Law.

2.2. Included activities.

2.2.1. Stock exchange or over-the-counter broker in stock exchanges or securities markets.

2.2.2. Operation and administration of automated teller machine networks.

2.2.3. Electronic transmission systems for transactions with entities and/or their clients.

2.2.4. Administration of retirement and pension funds.

2.2.5. Administration of mutual investment fund portfolios (management company).

2.2.6. Issuance of credit, debit and similar cards.

2.2.7. Administration of closed savings circles.

2.2.8. Financial assistance through leasing operations of capital goods, durable goods and real estate, acquired for such purpose ("leasing") or on credits arising from sales ("factoring").

2.2.9. Management of collection of public utility bills, credits and similar, and payroll payment services, supplier payment services and collection of receipts.

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Section 2. Complementary services.

2.2.10. Data processing and/or transmission services linked to financial activity.

2.2.11. Credit information services for commercial and financial use (databases of financial records).

2.2.12. Advisory services in financial and investment matters, and for mergers and/or acquisitions of companies, provided that it does not involve business administration or management. It may not grant loans.

2.2.13. Mutual guarantee companies, in the capacity of protecting partner.

2.2.14. Advisory on fund management and/or trust administration with respect to activities compatible with the type of entity.

2.2.15. Trustee of financial trusts.

2.2.16. Transport and/or custody of cash and securities, including the service of transporting correspondence and documents of a financial nature of the entities and/or their clients. Associated security service for premises of financial entities. In both cases, to the extent that it is a complement to the provision of the service to the owning entity/entities.

2.2.17. Registry agent service for securities and book-entry mortgage notes.

2.2.18. Settlement service for transactions with securities.

2.2.19. Fund clearing houses.

2.2.20. Temporary acquisition of interests in companies to facilitate their development, with the purpose of subsequently selling the holdings. Granting to those companies of financing and advisory in planning and management.

2.3. Authorization.

2.3.1. Scope.

The acquisition or incorporation by financial entities of corporate interests, direct or indirect, in companies whose purpose is the development of the activities listed in points 2.2.1., 2.2.6, 2.2.8. and 2.2.20. that exceed 12.5% of the share capital or of the total votes or lower percentages if this is sufficient to form the corporate will in shareholders' meetings or board meetings of said companies and without prejudice to the specific regulatory treatment that in each case

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Section 2. Complementary services.

may be applicable, shall be subject to the authorization of the Superintendency of Financial and Exchange Entities, for which the fulfillment of the following requirements shall be a condition:

2.3.1.1. Comply with the conditions established for the transformation of financial entities.

2.3.1.2. Have a rating of 1, 2 or 3 assigned by the Superintendency of Financial and Exchange Entities.

2.3.2. Application.

With the pertinent authorization applications, the following information must be accompanied, in accordance with the procedure established for that purpose:

2.3.2.1. Name, corporate purpose and description of the company's activities and specification of its degree of linkage to financial activity and the intention to exercise or not exercise corporate control.

2.3.2.2. Bylaws, which must expressly provide:

i) That modifications to the corporate purpose must be authorized by the Superintendency of Financial and Exchange Entities.

ii) That the verification of the company's operations is admitted with the scope provided in the Financial Entities Law.

2.3.2.3. Amount of the investment and schedule of disbursements.

2.3.2.4. Participation in the share capital, its total percentage distribution and list of shareholders holding 5% or more of the share capital and/or votes.

2.3.2.5. Use of the entity's infrastructure for the offering of services provided by the company.

2.3.2.6. Any other information that, in the opinion of the financial entity, is useful for the Central Bank of the Argentine Republic to evaluate the effect of the investment on its solvency, managerial capacity and management.

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COMPLEMENTARY SERVICES OF FINANCIAL ACTIVITY AND B.C.R.A. PERMITTED ACTIVITIES
Section 2. Complementary services.

2.3.3. Evaluation.

The Superintendency of Financial and Exchange Entities shall evaluate the characteristics of each project, emphasizing the effect of the investment on the economic, financial and management situation of the financial entity.

2.3.4. Approval.

Applications shall be considered approved once 90 calendar days have elapsed since the conditions established in points 2.3.1. and 2.3.2. are verified, if the Superintendency of Financial and Exchange Entities does not express its opposition. Said period may be extended if circumstances prevent the adoption of a resolution.

2.4. Cases that do not require authorization. Information.

In the case of participations in companies whose purpose is the performance of complementary activities not included in point 2.3.1., the entities must inform the Superintendency of Financial and Exchange Entities of the acquisitions they make - insofar as they determine holdings exceeding 12.5% of the share capital or of the total votes or lower percentages if this is sufficient to form the corporate will in shareholders' meetings or board meetings of said companies -, within 15 calendar days following the date on which the first disbursement committed by the operations is made effective.

2.5. Consolidated basis.

When more than 12.5% of the share capital of the company or of the total votes is held or controlled, or lower percentages if this is sufficient to form the corporate will in shareholders' meetings or board meetings but does not determine the requirement for consolidation, the Superintendency of Financial and Exchange Entities shall establish in each case whether or not the company's information must be consolidated, with the general scope provided in the consolidated supervision regime.

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B.C.R.A.	COMPLEMENTARY SERVICES OF FINANCIAL ACTIVITY AND PERMITTED ACTIVITIES
	Section 3. Other permitted activities.

3.1. Activities on own account.

Financial entities may carry out the following activities:

3.1.1. Real estate intermediation between third parties, complying with mandates expressly agreed with their clients.

3.1.2. Intermediation of general insurance contracts, as institorial agents in accordance with the legal and regulatory provisions in force in the matter and mass marketing of insurance included in Decree 855/94 of the National Executive Power and Resolution No. 23.469 of the Superintendency of Insurance of the Nation.

The intervention of the entities may not imply the assumption of responsibilities towards third parties nor affect directly or indirectly their patrimony or solvency.

These activities may be carried out indirectly through companies dedicated exclusively to one of those purposes, even if the possession of the shareholding exceeds 12.5% of the share capital or of the total votes or lower percentages if this is sufficient to form the corporate will in shareholders' meetings or board meetings, provided they have the authorization of the Superintendency of Financial and Exchange Entities, for which the requirements established in point 2.3. of Section 2 must be observed.

3.2. Through other companies.

Commercial and investment banks and financial companies may hold participations exceeding 12.5% of the share capital or 12.5% of the votes, or lower percentages if this is sufficient to form the corporate will in shareholders' meetings or board meetings, in insurance companies for the coverage of collective disability and death and retirement insurance provided in Law 24.241.

Authorization from the Superintendency of Financial and Exchange Entities shall be required, for which the requirements established in point 2.3. of Section 2 must be observed.

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B.C.R.A. ORIGIN OF THE PROVISIONS CONTAINED IN THE RULES ON SERVICES COMPLEMENTARY OF FINANCIAL ACTIVITY AND PERMITTED ACTIVITIES

TEXT ORDERED			SOURCE RULE					OBSERVATIONS
Sec.	Point	Parr.	Com.	Annex	Chap.	Sec.	Point	Parr.
1.	1.1.	1st	“A” 2384				2.
		2nd	“A” 2384				2.		Incorporates interpretive clarification.
	1.2.	1st and 2nd	“A” 3086
		3rd	“A” 2384						S/ Com. “A” 3086.
2.	2.1.	1st	“A” 2619						S/ Com. “A” 2988 and 3086.
		2°	“A” 3086
	2.2.1.		“A” 2056				2.	1°
	2.2.2. to 2.2.3.		“A” 3086
	2.2.4.		“A” 2155
	2.2.5.		“A” 2197
	2.2.6. to 2.2.18.		“A” 3086
	2.2.19.		“A” 2557	Sole	2.		1°
	2.2.20.		“A” 3086
	2.3.1.		“A” 2619				1°		S/ Com. “A” 2988 and 3086.
	2.3.1.1.		“A” 2619				1°		S/ Com. “A” 3086.
	2.3.1.2.		“A” 2619				1°		S/ Com. “A” 3086.
	2.3.2.		“A” 2619				2°
	2.3.2.1.		“A” 2619				2°
	2.3.2.2.		“A” 2619				2°		S/ Com. “A” 3086.
	2.3.2.2.i)		“A” 2619				4° a)
	2.3.2.2.ii)		“A” 2619				4° b)
	2.3.2.3.		“A” 2619				2°
	2.3.2.4.		“A” 2619				2°		S/ Com. “A” 3086.
	2.3.2.5. to 2.3.2.6.		“A” 2619				2°
	2.3.3.		“A” 2619				3°		S/ Com. “A” 3086.
	2.3.4.		“A” 2619				5°		S/ Com. “A” 3086
	2.4.		“A” 3086
	2.5.		“A” 2619				Last		S/ Com. “A” 2988 and 3086.
3.	3.1.	1°	“A” 3086
	3.1.1.		“A” 2056			1.
	3.1.2.		“A” 2384			1.	1° and 2°
	3.1.	2°	“A” 2056 “A” 2384			1. 1.	3°
		3°	“A” 3086
	3.2.	1°	“A” 2206			1. and 2.			S/ Com. “A” 3086.
	3.2.	2°	“A” 3086