2019 – YEAR OF EXPORT

COMMUNICATION “A” 6654 28/02/2019

TO FINANCIAL INSTITUTIONS:

Reference: Circular
OPASI 2 – 557
Deposit Guarantee Insurance. Increase of the coverage ceiling.

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

“‑ Establish, effective from 1 March 2019, an amount of $ 1.000.000 for the guarantee of the deposits referred to in points 5.3.1, 5.3.2, 5.3.3 and 6 of the regulations on ‘Application of the Deposit Guarantee Insurance System’.”

Furthermore, point 8.1 of the referenced regulations is updated.

Finally, we enclose the pages that, in replacement of those previously provided, must be incorporated into the regulations on “Application of the Deposit Guarantee Insurance System”. It is also reminded that on this Institution’s website www.bcra.gob.ar, accessing Financial System – LEGAL AND REGULATORY FRAMEWORK – Regulations and summaries – Ordered texts of general regulations, the modifications will be found with texts highlighted in special characters (strikethrough and bold).

Yours sincerely,

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA

Matías A. Gutiérrez Girault Darío C. Stefanelli Gerente de Emisión de Normas Gerente Principal de Emisión y Aplicaciones Normativas

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ANNEX

5.2.2

Sight deposits for which interest rates higher than the reference rates are agreed, and term deposits and investments that exceed 1.3 times that rate or the reference rate plus 5 percentage points – whichever is greater –.

The reference rates are periodically disseminated by the BCRA through Communications “B”, determined according to the moving average of the last five banking business days of the passive rates that, for term deposits up to $ 100.000 (or their equivalent in other currencies), arise from the survey carried out by the BCRA.

They will also be excluded when those interest‑rate limits are distorted by additional incentives or remunerations.

5.2.3

Deposits of financial entities in other intermediaries, including term‑deposit certificates acquired through secondary market negotiation.

5.2.4

Deposits made by persons linked, directly or indirectly, to the entity according to the guidelines defined in point 1.2.2 of the regulations on “Large Credit‑Risk Exposures”.

5.2.5

Term‑deposit deposits of securities, acceptances or guarantees.

5.2.6

Immobilised balances originating from deposits and other excluded operations.

5.3 Coverage – Amount and Formalities

5.3.1

The guarantee will cover the return of the deposited capital, interest, updates – by the Reference Stabilisation Coefficient ("CER") in deposits of Units of Purchasing Power – Law 25.827 ("UVA") and by the Construction Cost Index for Greater Buenos Aires ("ICC") in deposits of Housing Units – Law 27.271 ("UVI") – and quotation differences, as applicable, accrued up to the date of revocation of the authorization to operate or up to the date of suspension of the entity by application of article 49 of the BCRA Organic Charter, if that measure had been adopted prior to the former, without exceeding – for those concepts – $ 1.000.000.

That date will be considered for the determination of the CER and the ICC for investments in UVA and UVI, respectively, as well as for the determination of the Reference Exchange Rate for conversion to pesos of foreign‑currency deposits, for the purpose of establishing the amount reached by the coverage.

5.3.2

In accounts and investments constituted in the name of two or more persons, the guarantee limit will be $ 1.000.000 regardless of the number of account holders, the corresponding guarantee amount being proportionally distributed among the holders.

5.3.3

The total guaranteed to a given person, by accumulation of accounts and deposits covered by the guarantee, as previously provided, may not exceed the limit of $ 1.000.000.

Version: 19a. COMMUNICATION “A” 6654
Effective: 1/3/2019

B.C.R.A. APPLICATION OF THE DEPOSIT GUARANTEE INSURANCE SYSTEM

5.3.4

SEDESA will reject or postpone, until its judicial recognition, the request for coverage under this guarantee regime when the deposits do not meet the requirements established in the applicable regulations or when the depositors do not present material and formally valid titles.

5.3.5

SEDESA may require, prior to the liquidation of the guarantee, that depositors justify the origin and availability of the deposited funds through evidence that demonstrates their plausibility and/or that the effective entry of the funds into the entity has been verified for each operation covered by the regime. In addition, the said company must file the corresponding complaint when it detects irregularities or a criminal offence aimed at obtaining an undue collection of the guarantee.

6. Instrumentation

In all representative documents of passive operations (certificates, deposit slips, receipts issued by ATMs, account statements, etc.) the following legend must appear, visibly printed on the front or back of them:

“Deposits in pesos and in foreign currency are covered up to $ 1.000.000. In operations in the name of two or more persons, the guarantee will be prorated among the holders. In no case may the total guarantee per person and per deposit exceed $ 1.000.000, regardless of the number of accounts and/or deposits. Law 24.485, Decree No 540/95 and its amendments and Comm. “A” 2337 and its amendments and complements. Excluded are those attracted at rates higher than the reference rate according to the limits established by the Central Bank, those acquired by endorsement and those made by persons linked to the financial entity.”

If any of the situations mentioned in the last sentence occurs, the following legend must be placed visibly on the front of the documents:

“Deposit without guarantee”

This last requirement will not apply when operations are carried out through ATMs belonging to networks that enable operational interconnection of financial entities.

Entities must keep the full texts of Law 24.485, Decree No 540/95 (updated text) and the present regulations available to their clientele.

Furthermore, in any advertising carried out by financial entities related to the deposits they attract, the existence of a limited guarantee for its return must be indicated.

Version: 13a. COMMUNICATION “A” 6654
Effective: 1/3/2019

7.2 Entities without "CAMELS" rating

Until a rating from the Superintendency of Financial and Currency Entities ("CAMELS") is obtained, the correction index will be calculated from the following expression:

Ic = {(Ipr/f + Iar/a)/2} - Irpc/Kmin

For its application, the definitions of the terms according to point 7.1 will be taken into account.

8. Applicable Legislation

8.1 Law 24.485 (*)

Article 1°: The Deposit Guarantee Insurance System is created, which will be limited, mandatory and costly, with the purpose of covering the risks of bank deposits, in a subsidiary and complementary manner to the privilege and deposit protection system established by the Financial Entities Law, without committing the resources of the Central Bank of the Argentine Republic nor the National Treasury.

When the Central Bank of the Argentine Republic orders the total or partial suspension of operations or the revocation of the authorization to operate of a financial entity, the Deposit Guarantee Insurance System must provide reimbursement to its holders of the sums deposited in the special accounts for remuneration accreditation, enabled pursuant to the provisions contained in article 124 of Law 20.744 (ordered text 1976), within a period not exceeding five (5) business days from the date of suspension or revocation of the authorization to operate.

8.2 Decree 540/95 ()

Article 1°: The "DEPOSIT GUARANTEE FUND" (FGD) is created with the purpose of covering bank deposits within the scope provided in this Decree.

(*) The constitution of the company "SEGURO DE DEPOSITOS SOCIEDAD ANONIMA" (SEDESA) is ordered, with the exclusive purpose of exercising the fiduciary functions that the NATIONAL STATE or the CENTRAL BANK OF THE ARGENTINE REPUBLIC may entrust to it.

(*) Published in the Official Gazette on 18 April 1995, with the amendment of Law 25.089 (Official Gazette 14 May 1999).

() With the amendments of Decrees 1292/96, 1127/98, 1292/99, 32/01 and 214/02.

(*) Decree 32/01. Effective: 26/12/01.

Version: 8a. COMMUNICATION “A” 6654
Effective: 1/3/2019

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ORIGIN OF THE PROVISIONS CONTAINED IN THE REGULATIONS ON “APPLICATION OF THE DEPOSIT GUARANTEE INSURANCE SYSTEM”

Ordered Text – Source Norm

Point	Paragraph	Comm.	Annex	Point	Paragraph	Observations
1.	“A” 2337 I	1.	1°y 2°
1°	“A” 2337 I	2.	1° S/Dec. N°1292/96, Comm. “A” 2807, 3358, 4206, 4271, 5641 y 5943.
2.
2°	“A” 2337 I	2.	2° S/Dec. N°1292/96.
3.	1° “A” 2337 I	3.	1°
3.1.	“A” 2337 I	3.1.
3.2.	“A” 2337 I	3.2.
3.3.	“A” 2337 I	3.3.
3.3.1.	“A” 2337 I	3.3.1.
3.3.2.	“A” 2337 I	3.3.2.
3.	2° “A” 2337 I	3.	2°
1°	“A” 2337 I	4.	2°y 3° S/Com. “B” 5806 (8° paragraph), “A” 3068, 5710 y 5720.
4.
2°	“A” 2337 I	4.	4°
5.	“A” 2337 I	6.
5.1.	1° “A” 2337 I	6.1.	1°
5.1.1.	“A” 2337 I	6.1.	i)
5.1.2.	“A” 5108
5.1.3.	“A” 2337 I	6.1.	ii)
5.1.4.	“A” 2337 I	6.1.	iii)
5.1.5.	“A” 2337 I	6.1.	iv) S/Com. “A” 5091, 5164, 5234 y 6435.
5.1.6.	“A” 2482	1.	2°
5.1.7.	“B” 5806	3°	S/Com. “A” 2807.
5.2.	“A” 2337 I	6.4.	S/Com. “A” 2399.
5.2.1.	“A” 2337 I	6.4.1.	S/Com. “A” 2399.
5.2.2.	“A” 2337 I	6.3.	S/Com. “A” 2777, 3358, 5108, 5234, 5640, 5654, 5891, 6435 y 6460. Includes interpretative clarification.
5.2.3.	“A” 2337 IV		S/Dec. N° 540/95, art. 12, inc. c).
5.2.4.	“A” 2337 I	6.2.	S/ Com. “A” 5520 y 6639.
5.2.5.	“A” 2337 IV		S/Dec. N° 540/95, art. 12, inc. c).
5.2.6.	“A” 2807	5.2.7.
5.3.	“A” 2337 I	6.	S/Dec. N°540/95.
5.3.1.	“A” 2337 I	6.5.	S/Com. “A” 4681, 5170, 5641, 5943, 6125 y 6654.
5.3.2.	“A” 2337 I	6.7.	1° S/Dec. N°540/95 y Comm. “A” 5170, 5641, 5943 y 6654.
5.3.3.	“A” 2337 I	6.7.	2° S/Dec. N°540/95 y Comm. “A” 5170, 5641, 5943 y 6654.
5.3.4.	“A” 2337 I	6.8.	S/Dec. N°540/95.
5.3.5.	“A” 2337 I	6.9.

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APPLICATION OF THE DEPOSIT GUARANTEE INSURANCE SYSTEM

Point	Paragraph	Comm.	Annex	Point	Paragraph	Observations
6.
7.
7.1.
7.2.
8.
8.1.
8.2.
9.