CENTRAL AFRICAN BANKING COMMISSION

DEPOSIT GUARANTEE FUND BOARD OF DIRECTORS

DECISION NO. 01/11-FGD-CD ON THE INTERNAL REGULATIONS OF THE CENTRAL AFRICAN DEPOSIT GUARANTEE FUND

Having regard to Regulation No. 01/09/CEMAC/UMAC/COBAC establishing the Central African Deposit Guarantee Fund; Having regard to COBAC Regulation R-2009/03 on the organization and functioning of the Central African Deposit Guarantee Fund; In its session held on 21 February 2011 in Yaoundé;

The Central African Deposit Guarantee Fund, abbreviated FOGADAC, is a public establishment with a sub-regional mandate, possessing legal personality and enjoying financial autonomy. The Fund's operating rules derive from the provisions of Regulation No. 01/09/CEMAC/UMAC/COBAC establishing the Central African Deposit Guarantee Fund, COBAC Regulation R-2009/03 on the organization and functioning of the Fund, as well as texts adopted for their operation, including this Internal Regulation. This Internal Regulation specifies the organizational and operational procedures of the Central African Deposit Guarantee Fund. The Central African Deposit Guarantee Fund has the following objectives: to compensate savers of a credit institution in the event of unavailability of their deposits or all other refundable funds; to provide assistance to a credit institution whose situation suggests, in the near term, total or partial unavailability of depositors' assets. The Central African Deposit Guarantee Fund carries out any operation necessary or useful to achieve its objectives.

The Fund's headquarters are located within the General Secretariat of the Central African Banking Commission (COBAC). The Board of Directors comprises: the Governor of the Bank of Central African States, as President or, in his absence, the Vice-Governor as Deputy; and, where applicable, the monetary authority of the State in whose favor the Board decides to intervene. The Board may validly deliberate only if at least half of its members are present or represented. If this quorum is not met, the Board President shall convene a new meeting of members within a reasonable timeframe, with no quorum requirement then applying. The General Secretary of the Central African Banking Commission and the Permanent Secretary of the Fund participate in Board meetings. The Permanent Secretary reports on matters placed on the Fund's meeting agendas. The Board meets at least twice a year, at the Fund's headquarters or any other location. An attendance register is maintained for each meeting. The Board may be convened in cases of urgency by the President or upon request by members representing at least two-thirds of the Board. Board members are notified by any means, at least fifteen days before the meeting date, except in urgent cases or when ruling on a preventive intervention proposal.

Unless otherwise provided in this Internal Regulation, Board decisions are taken by a simple majority of present or represented members. In case of a tie in expressed votes, the President's vote is decisive. Extracts from these minutes are signed by the Board President or the Fund's Permanent Secretary.

TITLE III - POWERS OF THE BOARD OF DIRECTORS AND DECISION-MAKING PROCEDURES

The Board of Directors: a) defines the Fund's general policy; b) decides on depositors' compensation procedures; c) rules on the Fund's interventions in CEMAC member States; d) examines amicable appeals regarding compensation; e) defines the organizational and operational procedures of the Permanent Secretariat; f) establishes the Fund's budget upon proposal by the Permanent Secretariat; g) approves, upon proposal by the Permanent Secretariat, the accounting rules governing the Fund; h) sets the entry fee amount for new participants in the Fund; i) exercises permanent oversight of the Fund's management. To this end, it may at any time request documents it deems necessary to fulfill its mission, notably the Fund's balance sheet, income statement, and a quarterly summary report of the Fund's status; j) verifies, audits, and approves the Fund's annual accounts prepared by the Permanent Secretariat within a period not exceeding three (03) months from the close of the financial year.

By a two-thirds (2/3) majority of expressed votes, the Board of Directors: a) adopts the Fund's Internal and Financial Regulations; b) appoints and dismisses the Fund's Permanent Secretary upon proposal by COBAC's General Secretary; c) appoints and dismisses the Fund's Auditor upon the conforming opinion of the Banking Commission; d) issues its conforming opinion for the designation of other Permanent Secretariat members; e) authorizes, upon proposal by the Permanent Secretariat, the initiation of liability actions provided for in Article 25 of the aforementioned CEMAC Regulation; f) designates within its ranks any committee it deems necessary for studying matters within its competence; g) grants all powers of delegation for the execution of its decisions; h) authorizes, upon proposal by the Permanent Secretariat, the signing of agreements between the Fund and natural or legal persons, entities, or national, regional, or international institutions.

Deliberations concerning the conditions and procedures for: utilizing or levying Fund resources to carry out compensations; calling supplementary contributions from credit institutions either to cover all Fund interventions or to restore the Fund's intervention capacity; calling upon State guarantees in the territory where the concerned institution is located; and suspending contributions when Fund resources reach a level deemed satisfactory by the Board, upon the Banking Commission's opinion, are taken by at least three-quarters (3/4) majority of present or represented members' votes.

By unanimity, the Board of Directors: a) may, upon COBAC's conforming opinion, review the minimum contribution amount for credit institutions not collecting deposits; b) may decide, upon conforming opinion from the Banking Commission issued within a specific compensation procedure, to adjust reimbursement amounts according to the Fund's intervention capacity. This adjustment may consist either of proportionally reducing compensations relative to the Fund's available funds, or of revising upward the compensation ceiling considering the size of the intervention reserve; c) rules, upon conforming opinion from the Banking Commission, on changes to the procedures for determining entry fees payable by new Fund participants; d) decides, based on the Permanent Secretariat's report, on preventive interventions proposed by the Banking Commission as well as their conditions and procedures; e) decides on the principle and procedures for supplementary contributions from credit institutions necessitated by insufficient system availability to handle a preventive intervention.

TITLE IV - STATUS AND POWERS OF THE PERMANENT SECRETARIAT MEMBERS

The Fund's day-to-day management is ensured by a Permanent Secretary. He may be assisted by a Deputy. The Permanent Secretary and his Deputy are drawn from the staff of the Bank of Central African States (BEAC) made available to COBAC's General Secretariat, under conditions proposed by COBAC's General Secretary and approved by the Board of Directors. The Permanent Secretary is appointed by the Board of Directors for a term of three (03) years, renewable once, upon proposal by COBAC's General Secretary. By way of derogation from the provisions of paragraph 1 of Article 5 above, the appointment and dismissal of Permanent Secretariat members require the presence or representation of all Board of Directors members. In case of resignation or incapacity of a Permanent Secretariat member, the replacing member is appointed under the same conditions, for the remainder of the replaced member's term. The Permanent Secretary and his Deputy, where applicable, receive an allowance whose amount and procedures are fixed by the Board of Directors, upon proposal by COBAC's General Secretary. The Permanent Secretariat: a) holds the broadest powers to act on behalf of and for the account of the Guarantee Fund, within the limits of powers delegated to the Board of Directors; b) represents the Guarantee Fund vis-à-vis third parties. It may sue and be sued; c) submits to the Board of Directors each quarter a report on the Fund's operations and quarterly accounts; d) prepares and presents to the Board of Directors the Fund's annual accounts, including a balance sheet and income statement; e) informs the Board President as soon as aware of any potential preventive intervention proposal; f) prepares the report on any preventive intervention proposed by the Banking Commission; g) prepares the closure report for any compensation or preventive intervention of the Guarantee Fund; h) provides secretariat services for Board meetings, reporting agenda items; i) calculates credit institutions' contributions and notifies them to the concerned parties; j) may authorize, for a credit institution, installment payments of annual contributions; k) informs depositors of the unavailability of deposits; l) verifies claims submitted for compensation; m) compensates depositors within fixed deadlines; n) takes all useful measures to execute Board decisions. The Permanent Secretary prepares an annual report on the Guarantee Fund's operations, which he presents to the Board of Directors and makes available to the public. The Permanent Secretary transmits a copy of the approved accounts to the UMAC Ministerial Committee. The Permanent Secretary may temporarily delegate his functions to his Deputy. He informs the Board President thereof.

Eligible asset and deposit beneficiaries are compensated according to the following procedures:

1. The Banking Commission certifies the unavailability of eligible deposits, notifies the Fund's Permanent Secretariat, and requests its intervention;
2. Receipt of the notification triggers the Fund's intervention procedure. This trigger is announced by a notice from the Permanent Secretariat published in the press;
3. Based on bank records, the Fund's Permanent Secretariat prepares certificates of the amounts of claims or rights eligible for the compensation procedure borne by the Guarantee Fund;
4. These certificates are transmitted to clients by registered letter with acknowledgment of receipt or by any other means leaving a written record; they contain the details specified in Article 40 of the aforementioned COBAC Regulation. Unless remarks or objections are made within fifteen (15) days after dispatch, the client must return the approved certificate within the same timeframe and provide the account number in another credit institution, which shall be credited with the compensation amount;
5. Upon expiration of the aforementioned deadline or upon receipt of confirmation of the certificate, the Guarantee Fund initiates payment to depositors;
6. Failing indication of an account number, the coordinates of the authorized paying bank are communicated to depositors. The authorized bank opens accounts in the names of the concerned depositors for the covered amounts;
7. From the day of publication of deposit unavailability, depositors who have not been personally contacted by the Guarantee Fund have a period of two (02) months to assert their right to intervention;
8. Upon expiration of the aforementioned period, the Fund compensates the beneficiaries of other concerned depositors;
9. The compensation deadline may be extended twice at most, which may not exceed a total of four (04) months;
10. The decision to extend the compensation period must be published by the Permanent Secretariat;
11. The Fund's intervention leads to the withdrawal of the institution's authorization, pronounced by the Banking Commission;
12. After payment, the Fund is subrogated to the rights of compensated depositors vis-à-vis the liquidator.

The Board of Directors decides unanimously on preventive intervention upon proposal by the Banking Commission and after presenting conclusions from the Permanent Secretary's report, prepared following an audit mission mandated within the institution. a) The estimated cost of preventive intervention compared to the cost of curative intervention; b) Elements regarding commitments by shareholders or partners, or support the institution may benefit from; c) Management of the concerned credit institution; d) Potential transfer of the business and, more generally, the institution's assets; e) Procedures for clearing losses by imputation on shareholders' participations; f) Procedures for shareholders waiving their preferential subscription rights; g) Activation of liabilities; h) Estimated schedule for all operations related to such an intervention. The report incorporates the Banking Commission's opinion on conditions proposed by the Permanent Secretariat. The Board of Directors, upon reviewing the report, may, if deciding on preventive intervention, modify conditions proposed by the Permanent Secretariat. These are communicated to the Banking Commission. The Board of Directors definitively establishes the conditions for the Guarantee Fund's intervention after considering the Banking Commission's opinion thereon. The Board President informs the Banking Commission thereof.

Article 21.- Duty of Confidentiality of Board Members and Permanent Secretary

Board members, the Permanent Secretariat, and any person authorized to act on behalf of and for the account of the Fund are bound by professional secrecy. Persons covered by the preceding article are prohibited from leveraging their status to directly or indirectly benefit from any advantage whatsoever. Any difficulty arising from the interpretation or application of this Internal Regulation falls under the Board's competence. This Internal Regulation may be amended by the Board either on its own initiative or upon request by half of its members, based on the Permanent Secretary's proposal, by a two-thirds (2/3) majority of expressed votes.

Mr. Lucas ABAGA NCHAMA, President; Messrs. Pascal REBILLARD, Christian ASSOSSOU, YOUNES EL MAS LOUMI, Claude AYO-IGUENDA, Joseph TINDJOU DJAMENI, and KERIM MAHAMAT ALI, Members.