Resolution JPRM-2025-011-G: Reforming the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador

RESOLUTION No. JPRM-2025-011-G THE MONETARY POLICY AND REGULATION BOARD

CONSIDERING:

That, Article 226 of the Constitution of the Republic of Ecuador prescribes that public servants and persons acting under a state authority shall exercise only the competencies and powers attributed to them in the Constitution and the Law;

That, Article 227 ibid states that the Public Administration constitutes a service to the community governed by principles of effectiveness, quality, hierarchy, coordination, planning, among others;

That, the first paragraph of Article 303 of the Constitution of the Republic determines that the formulation of monetary, credit, exchange, and financial policies is the exclusive faculty of the Executive Function and will be implemented through the Central Bank of Ecuador;

That, the second paragraph of the General Provision Fourth of the Organic Law for the Strengthening of Protected Areas states: “The structure and functions of the Financial Policy and Regulation Board and the Monetary Policy and Regulation Board, established in the Organic Monetary and Financial Code until before June 26, 2025, will remain in effect until the designation of the members of the Financial and Monetary Policy and Regulation Board by the National Assembly”;

That, Article 47.1 of the Organic Monetary and Financial Code creates the Monetary Policy and Regulation Board as part of the Executive Function, responsible for the formulation of monetary policy, the highest governing body of the Central Bank of Ecuador, and determines its composition;

That, Article 47.6 of the same Code, regarding the functions of the Monetary Policy and Regulation Board, among others, includes: “5. Establish the policies of the Central Bank of Ecuador and supervise their implementation; 6. Monitor compliance with the functions of the Central Bank of Ecuador; (…) 15. Establish and regulate the functioning of committees that may be necessary for the operation of the Bank; (…) 26. Those others conferred by law (…)”;

That, the last paragraph of Article 57.3 of the Organic Monetary and Financial Code establishes that the Monetary Policy and Regulation Board must define the scope, terms, and conditions of the function of the Banking Audit Directorate of the Central Bank of Ecuador;

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That, Article 128 of the Organic Administrative Code establishes: “Normative act of an administrative character. It is any unilateral declaration made in the exercise of an administrative competence that produces general legal effects, which is not exhausted with its compliance and directly”;

That, by Resolution No. JPRM-2025-007-G, of July 16, 2025, the Monetary Policy and Regulation Board approved the Codification of Governance Resolutions of the Monetary Policy and Regulation Board and the Central Bank of Ecuador;

That, it is necessary to reform Section 2 “Composition and functioning of the Institutional Committees of the Central Bank of Ecuador” of Chapter I; and Section 1 “Internal Audit Policy of the Central Bank of Ecuador” of Chapter II, of Title II of the Codification of Governance Resolutions of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, to incorporate the participation of a member of the Monetary Policy and Regulation Board, as well as the Director of the Banking Audit Directorate, in the Institutional Management Committee, Integrated Risk Management Committee, and Monetary and Financial Stability Committee, to improve risk management criteria, as well as to incorporate best practices issued by the Global Institute of Internal Auditors, strengthening the Internal Audit function.

That, the Monetary Policy and Regulation Board, in ordinary session by mixed modality, on August 28, 2025, reviewed the proposal sent via memorandum No. BCE-DAB-2025-0389-M, of August 26, 2025, by the Director of the Banking Audit Directorate, Acting Director of the Central Bank of Ecuador to the President of the Monetary Policy and Regulation Board; as well as the technical reports No. BCE-DAB-2025-062, of August 26, 2025 and No. BCE-DAB-2025-063 of the same date; and the legal report No. BCE-JPRM-2025-0083-M, of August 27, 2025; and,

In exercise of its functions and in accordance with Article 47.7 of the Organic Monetary and Financial Code, the Monetary Policy and Regulation Board resolves:

REFORM THE CODIFICATION OF GOVERNANCE OF THE MONETARY POLICY AND REGULATION BOARD AND THE CENTRAL BANK OF ECUADOR ISSUED BY RESOLUTION NO. JPRM-2025-007-G, OF JULY 16, 2025

Article 1.- Include as paragraphs 14 and 15 of Article 35 of Paragraph 2: “Integrated Risk Management Committee”, of Subsection 3: “Institutional Committees”, of Section 2 “Composition and functioning of the Institutional Committees of the Central Bank of Ecuador”, of Chapter I “Governance of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, the following:

“14. Member of the Monetary Policy and Regulation Board, who shall act with voice only; and, 15. Director of the Banking Audit Directorate, who shall act with voice only.”

Article 2.- In Article 39 of Paragraph 3: “Monetary and Financial Stability Committee”, of Subsection 3: “Institutional Committees”, of Section 2 “Composition and functioning of the Institutional Committees of the Central Bank of Ecuador”, of Chapter I “Governance of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, make the following reforms:

1. Substitute paragraph 11, with the following: “11. Member of the Monetary Policy and Regulation Board, who shall act with voice only; and,”

2. Following paragraph 11, add the following: “12. Director of the Banking Audit Directorate, who shall act with voice only.”

Article 3.- Include as paragraphs 15 and 16 of Article 47 of Paragraph 5: “Institutional Management Committee”, of Subsection 3: “Institutional Committees”, of Section 2 “Composition and functioning of the Institutional Committees of the Central Bank of Ecuador”, of Chapter I “Governance of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, the following:

“15. Member of the Monetary Policy and Regulation Board, who shall act with voice only; and, 16. Director of the Banking Audit Directorate, who shall act with voice only.”

Article 4.- Substitute the name of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, with the following:

“BANKING AUDIT POLICY OF THE CENTRAL BANK OF ECUADOR”

Article 5.- Substitute paragraphs 4 and 19 of Article 146 of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, with the following:

“4) Ethics and professionalism: Comprises the observance of the Code of Ethics of the MIPP issued by the IIA, which establishes principles and norms of conduct aimed at guaranteeing integrity, objectivity, competence, professional diligence, and confidentiality in the exercise of internal audit. “19) International Professional Practices Framework for Internal Audit - IPPF. - A structural model and coherent system that facilitates uniformity in the development, interpretation, and application of a set of knowledge useful for the professional practice of internal audit. The IPPF includes the Global Internal Audit Standards, the Attestation Requirements, and the Global Guidance.”

Article 6.- Substitute Article 147 of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, with the following:

“Article 147.- Object and Purpose: Establish the policies governing the performance of the Banking Audit Directorate, oriented to provide independent and objective assurance and advisory internal services, as well as prospective analysis and risk-based forecasts, in order to strengthen capabilities and optimize the operations of the Central Bank of Ecuador at the national level.”

Article 7.- Substitute letter b) of Article 149 of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, with the following:

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“b) Internal advisory services: The Banking Audit Directorate will advise the administrative units of the Central Bank of Ecuador on previously agreed topics with the respective managers; additionally, it will provide its prospective analysis and risk-based forecasts, with the purpose of increasing the effectiveness and efficiency of processes and improving their risk and control management.

Article 8.- Substitute the first paragraph of Article 150 of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, with the following:

“Article 150.- International Professional Practices Framework for Internal Audit: The Banking Audit Directorate will develop its functions complying with the international standards established in the International Professional Practices Framework for Internal Audit issued by The Institute of Internal Auditors, which includes the Global Internal Audit Standards, the Attestation Requirements, and the Global Guidance.”

Article 9.- In Article 155 of Section 1 “Internal Audit Policy of the Central Bank of Ecuador”, of Chapter II “On the Audit of the Central Bank of Ecuador”, of Title II “Governance Policies of the Central Bank of Ecuador” of the Governance Codification of the Monetary Policy and Regulation Board and the Central Bank of Ecuador, issued by Resolution No. JPRM-2025-007-G, of July 16, 2025, make the following reforms:

1. Following letter c), add the following: “d) Formulate the strategic plan of the Banking Audit Directorate aligned with the Institutional Strategic Plan of the Central Bank of Ecuador – PEI and present it to the Audit Committee within a maximum period of six (6) months following the approval of the PEI.”

2. Renumber.

SINGLE REPEALING PROVISION.- Resolution No. JPRM-2023-009-M, of April 6, 2023, which contains the “Policy for the commercialization of gold acquired by the Central Bank of Ecuador from artisanal and small-scale miners”, is repealed, as it is included in Section 9 “Commercialization of gold acquired by the Central Bank of Ecuador from artisanal and small-scale miners”, of Chapter I “On the Operations of the Central Bank of Ecuador”, of Title II “Operations Policies of the Central Bank of Ecuador” of the Codification of Monetary Policy and Operations Resolutions of the Central Bank of Ecuador issued by the Monetary Policy and Regulation Board, issued by Resolution No. JPRM-2025-006-M, of July 16, 2025.

FINAL PROVISION.- This resolution will enter into force from its issuance, without prejudice to its publication in the Official Register.

The General Secretariat of the Central Bank of Ecuador is tasked with its publication on the institutional website.

COMMUNICATE AND PUBLISH. - Given in the Metropolitan District of Quito, on August 28, 2025.

THE PRESIDENT Dr. TATIANA MARIBEL RODRÍGUEZ CERÓN

The preceding resolution was signed by Doctor Tatiana Maribel Rodríguez Cerón - President of the Monetary Policy and Regulation Board, in the Metropolitan District of Quito, on August 28, 2025.- I CERTIFY.

ADMINISTRATIVE SECRETARY Mgs. MARÍA ALEXANDRA GUERRERO DEL POZO