Credit assistance to MSMEs, net position in LELIQ, spot and forward transactions, repos, collateralized loans, other derivatives and mutual investment funds, minimum cash, foreign exchange and exchange, adjustments

2020 - YEAR OF GENERAL MANUEL BELGRANO

CENTRAL BANK OF THE ARGENTINE REPUBLIC

COMMUNICATION “A” 7006
08/05/2020

TO FINANCIAL INSTITUTIONS,
TO FOREIGN EXCHANGE OPERATORS:

Ref.: Circular
REMON 1 - 1012
OPRAC 1 - 1027
CAMEX 1 - 845

Credit assistance to MSMEs. Net position in LELIQ. Spot and forward transactions, repos, collateralized loans, other deriva- tives and with mutual investment funds.
Minimum cash. Foreign exchange and ex- change. Adjustments .

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

“1. To provide, with effect from 11.5.2020, that financial institutions must reduce their net position of BCRA Liquidity Bills (LELIQ) that exceed those admitted for the integration of the minimum cash requirement in pesos, provided for in point 1.3.16. of the rules on “Minimum cash”, by an additional 1% to the excess position registered as of 19.3.2020. In order to adapt, they must decrease their net position as they collect the LELIQ.

2. To establish, with effect from 11.5.2020, a decrease in the average requirement in pesos of minimum cash for an amount equivalent to 40% of the peso financing to MSMEs –according to the definition contained in the rules on “Determination of the condition of micro, small or medium enterprise”– that are granted at a nominal annual interest rate of up to 24%, measured in monthly average of daily balances of the previous month, provided that said MSMEs are not reported in the “Central de deudores del sistema financiero” administered by the Central Bank of the Argentine Republic.

Financing granted to other financial institutions and to non-financial credit providers may be included in that sum, provided that: i) within 3 business days from the date on which they receive the assistance, those entities allocate the funds to grant financing to MSMEs under the conditions of this point and ii) they have a special report from an external auditor –registered in the “Registro de auditores” of the SEFyC–, which complies with the provisions of point 1.5.4. of the rules on “Minimum cash”.

The financing computed for these purposes may not be considered for the decreases in the minimum cash requirement provided for in points 1.5.1., 1.5.4. to 1.5.6. of the rules on “Minimum cash”.

3. To provide that the financial institutions covered must grant financing to MS-
   MEs –according to the definition contained in the rules on “Determination of the condition of micro, small or medium enterprise”– that are not reported in the “Central de deudores del sistema financiero”, at a nominal annual interest rate of up to 24%, when they are presented with FOGAR guarantee, for the amount covered by said guarantee.

4. As of 1.7.2020, the admitted excess net position established in point 8.2.2 of the rules on “Spot and forward transactions, repos, collateralized loans, other derivatives and with mutual investment funds” shall be reduced according to the following scheme:

Percentage reached	Reduction to the admitted excess net position (point 8.2.2. of the cited rules)
100 %	1 %
< of 100 % up to 75 %	1,5 %
< of 75 % up to 50 %	2 %
< of 50% up to 25 %	2,5 %
< of 25 %	3%

Where:

Percentage reached: amount of financing to be considered, as a percentage of the reduction in the LELIQ position established in point 1. plus the amount of the decrease in the average requirement in pesos of minimum cash provided for in point 2., both of this communication.

The amount of financing to be considered shall be the monthly average of daily balances of the included financing of the previous period. For the month of July 2020, the average of daily balances registered between 11.5.2020 and 30.6.2020 shall be used.

5. To establish the prior conformity of the BCRA for access to the foreign exchange market to carry out operations corresponding to formation of external assets of residents, remittance of family aid and derivatives, under the terms of point 3.8. of the rules on “Foreign exchange and exchange” or to sell securities with settlement in foreign currency or transfer them to other depository entities, for persons who access the financing granted in accordance with points 2. and 3. of this communication, until their total cancellation.

6. The entities authorized to operate in foreign exchange must request from clients who require access to the foreign exchange market to carry out operations of formation of external assets, remittance of family aid and the operation with derivatives, set forth in point 3.8. of the rules on “Foreign exchange and exchange”, the authorization cited in the preceding point or a sworn statement stating that they are not beneficiaries of financing granted in accordance with points 2. and 3. of this communication.

7. The BCRA shall make available to financial institutions the list of MSMEs provided by the Ministry of Production of the Nation, without prejudice to which financial institutions may incorporate others as long as they meet the requirements provided for in the rules on “Determination of the condition of micro, small or medium enterprise”.”

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Likewise, we inform you that we will subsequently send you the pages that, in replacement of those previously provided, should be incorporated into the referenced rules.

We greet you attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Matías A. Gutiérrez Girault
Manager of Issuance of Rules

Darío C. Stefanelli
Principal Manager of Issuance and
Regulatory Applications