2020 - YEAR OF GENERAL MANUEL BELGRANO

CENTRAL BANK OF THE ARGENTINE REPUBLIC

COMMUNICATION “A” 7161
12/11/2020

TO FINANCIAL INSTITUTIONS:

Ref.: Circular
OPRAC 1 - 1075
REMON 1 - 1036

Financing line for productive investment of MiPyMEs. Adjustments.

---

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

“1. Establish, for the purpose of compliance with the rules on “Financing line for productive investment of MiPyMEs”, that for the determination of entities included in group A, in accordance with the provisions of Section 4. of the rules on “Authorities of financial institutions”, the indicator in point 4.1. of the rules referred to last shall be computed, for all financial institutions, only on an individual basis.

2. Provide, with effect from 13.11.2020, that financings granted to MiPyMEs that after 19.3.2020 have imported final consumer goods may be computed for the “Financing line for productive investment of MiPyMEs”, provided that it is for the destination provided in point 4.1.

3. Admit, with effect from 13.11.2020, as special eligible financings for the “Financing line for productive investment of MiPyMEs” the incorporation through assignment or discount of the financings provided in points 4.1. and/or 4.2. of the aforementioned rules. The financings must comply with the conditions established in those rules and may only be computed by the acquiring financial institution.

In addition, there must be a special report from the external auditor of the financial institution that granted the financings on their compliance, which must contain, in addition to the characteristics specified in Section 9., the dates and amounts of each financing to the destinations provided therein.

4. Admit as a defect in the application of “Financing line for productive investment of MiPyMEs” the financings disbursed as from 13.11.2020 as prefinancings of exports –except when they are to large exporting companies (Section 7. of the rules on “Credit policy”)–, export financings and/or financing of imports of inputs and/or capital goods –excluding services– that are financed with credit lines from foreign banks, new external loans and/or negotiable obligations placed abroad, or granted by financial institutions abroad linked to the financial institution covered in accordance with Section 2. of the rules on “Large exposures

to credit risk”. Financings granted with resources obtained from international organizations and/or international agencies or credit offices shall be excluded. international organizations and/or international agencies or credit offices.

All of the following conditions must be verified:

− The foreign financings have a contractual term of no less than 180 calendar days.

− They are new foreign financings received by the entity and used as from 13.11.2020.

− The rate shall be the one freely agreed upon.

− The foreign financings correspond to funds effectively disbursed by the foreign creditor.

− The amount to be allocated may not exceed the increase resulting from considering the average of the increases in daily balances recorded between 13.11.2020 and 31.3.21, with respect to the balance recorded as of 12.11.2020.

In all cases, the accounting balances owed for eligible foreign obligations shall be considered.

For these purposes, the exchange rate of the day of receipt of the foreign funds shall be applied.

The computation of these financings also includes compliance with the provisions of the last paragraph of point 3.1. of the rules on “Financing line for productive investment of MiPyMEs”.

5. Establish, with effect from 1.11.2020, a decrease in the average requirement in pesos of minimum cash by an amount equivalent to 14 % of the financings provided in point 4.1. of the “Financing line for productive investment of MiPyMEs” that are granted at a nominal annual interest rate of up to 30 %, measured in monthly average of daily balances of the previous month.

The financings computed for these purposes may not be considered for another decrease in the minimum cash requirement provided in the rules on “Minimum cash”.”

On the other hand, we send you the pages that, in replacement of those previously provided, should be incorporated into the referenced rules. In this regard, it is recalled that on the page of this Institution www.bcra.gob.ar, by accessing “Financial System – LEGAL AND REGULATORY FRAMEWORK – Ordering and summaries – Ordered texts of general regulations”, you will find the modifications made with texts highlighted in special characters (strikethrough and bold).

We greet you attentively.
CENTRAL BANK OF THE ARGENTINE REPUBLIC

Darío C. Stefanelli
Principal Manager of Issuance and
Regulatory Applications

María D. Bossio
General Deputy Manager of Financial Regulation

ANNEX

FINANCING LINE FOR INVESTMENT
B.C.R.A.
PRODUCTIVE OF MiPyME
Section 1. Entities covered.

Financial institutions that as of 16.10.2020 are included in group A –in accordance with the provisions of Section 4. of the rules on “Authorities of financial institutions”, for which the indicator in point 4.1. of those rules must be computed, for all financial institutions, only on an individual basis– and those that –not included in said group– operate as financial agents of the National, provincial, of the Autonomous City of Buenos Aires and/or municipal governments.

Version: 2nd. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 1

FINANCING LINE FOR INVESTMENT
B.C.R.A. PRODUCTIVE OF MiPyME
Section 3. Applications.

3.1. Destination.

The quota defined in Section 2. must be granted to MSMEs in accordance with the definition in force in the rules on “Determination of the condition of micro, small or medium-sized enterprise”.

The following are excluded:

3.1.1. from the destinations of points 4.1. and 4.2.: MSMEs with agricultural activity that maintain a stockpile of their wheat and/or soybean production with a value exceeding 5 % of their annual harvest capacity. The financial institution shall be responsible for verifying that the applicant is not included in this exclusion, requesting information and documentation that accredits it;

3.1.2. from the destination of point 4.2.: MSMEs that after 19.3.2020 have imported final consumer goods, except in the case of medical products and/or inputs.

For these purposes, the simple average of the daily balances of the financing in force during the period between 16.10.2020 and 31.3.21 shall be considered.

At least 30 % of the quota must be allocated to the provisions of point 4.1.

3.2. Compliance defects.

Financial institutions may count the following financing for compliance with the quota in Section 2.:

3.2.1. Those allocated in points 1.5.4., 1.5.5. and 1.5.7. of the rules on “Minimum cash” and that have been disbursed up to 15.10.2020.

3.2.2. Those disbursed as of 13.11.2020 as export prefinancing – except in the case of large exporting companies (Section 7. of the rules on “Credit policy”) –, export financing and/or financing of imports of inputs and/or capital goods – excluding services – that are financed with credit lines from foreign banks, new external loans and/or negotiable obligations placed abroad, or granted by foreign financial institutions related to the financial institution covered in accordance with Section 2. of the rules on “Large exposures to credit risk”. Financing granted with resources obtained from international organizations and/or international agencies or credit offices shall be excluded.

All of the following conditions must be verified:

− The foreign financing has a contractual term of no less than 180 consecutive days.

Version: 2a. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 1

Section 3. Applications.

− It is new foreign financing received by the institution and used as of 13.11.2020.

− The rate shall be the one freely agreed upon.

− The foreign financing corresponds to funds effectively disbursed by the foreign creditor.

− The amount to be allocated may not exceed the increase resulting from considering the average of the increases in daily balances recorded between 13.11.2020 and 31.3.21, with respect to the balance recorded as of 12.11.2020.

In all cases, the accounting balances owed for eligible external obligations shall be considered.

For these purposes, the exchange rate of the day of entry of the foreign funds shall be applied.

The computation of this financing also includes compliance with the provisions of the last paragraph of point 3.1.

Version: 1a. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 2

FINANCING LINE FOR PRODUCTIVE INVESTMENT
B.C.R.A.
OF MSMEs
Section 4. Eligible financing.

4.3.4. Incorporation through assignment or discount of the financing provided in points 4.1. and/or 4.2. granted by financial institutions.

In all cases, the financing must comply with the conditions established in these rules and may only be counted by the acquiring financial institution, if applicable.

For the purposes of allocating the financing in points 4.3.3. and 4.3.4., there must be a special report from an external auditor of the financial institution not covered – in the case of point 4.3.3. – or that granted the financing – in the case of point 4.3.4. – on its compliance, which must contain, in addition to the characteristics specified in Section 9., the dates and amounts of each application to the destinations provided herein.

Version: 2a. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 2

B.C.R.A.
ORIGIN OF THE PROVISIONS CONTAINED IN THE RULES ON “FINANCING LINE FOR PRODUCTIVE INVESTMENT OF MSMEs”

CENTRAL BANK OF THE ARGENTINE REPUBLIC

TEXT AS AMENDED			SOURCE RULE				OBSERVATIONS
Sect.	Point	Para.	Comm.	Annex	Sec.	Point	Para.
1.			“A” 7140	sole		1.		According to Com. "A" 7161.
2.			"A" 7140	sole		2.
3.	3.1.		"A" 7140	sole		3.1.		According to Com. "A" 7161.
	3.2.1.		"A" 7140	sole		3.2.
	3.2.2.		"A" 7161			4.
4.	4.1.		"A" 7140	sole		4.1.
	4.2.		"A" 7140	sole		4.2.		According to Com. "A" 7155. Includes interpretive clarification.
	4.3.		"A" 7140	sole		4.3.
	4.3.1.		"A" 7140	sole		4.3.1.
	4.3.2.		"A" 7140	sole		4.3.2.
	4.3.3.		"A" 7140	sole		4.3.3.
	4.3.4.		"A" 7161			3.
	4.3.	last	"A" 7140	sole		4.3.		According to Com. "A" 7161.
5.	5.1.		"A" 7140	sole		5.1.
	5.2.		“A” 7140	único		5.2.
6.	6.1.		“A” 7140	único		6.1.
	6.2.		“A” 7140	único		6.2.
	6.3.		“A” 7140	único		6.3.
	6.4.		“A” 7140	único		6.4.
	6.5.		“A” 7140	único		6.5.
7.	7.1.		“A” 7140	único		7.1.
	7.2.		“A” 7140	único		7.2.
8.			“A” 7140	único		8.
9.			“A” 7140	único		9.
10.			“A” 7140	único		10.
11.	11.1.		“A” 7140	único		11.1.
	11.2.		“A” 7140	único		11.2.

1.5.6. Special within the framework of Decree No. 332/2020 (and amendments). The requirement will be reduced by an amount equivalent to: i) 60% of the sum of the “Zero Rate Credits”, “Subsidized Rate Credits for Companies” and “Zero Rate Culture Credits” granted within the framework of Decree No. 332/2020 (and amendments) and disbursed up to 5.11.2020; ii) 24% of the “Subsidized Rate Credits for Companies” disbursed as of 6.11.2020 at a nominal annual rate of 27%; iii) 7% of the “Subsidized Rate Credits for Companies” disbursed as of 6.11.2020 at a nominal annual rate of 33%. Their average monthly balance in the period prior to the computation of the requirement will be considered.

1.5.7. Financing to MSMEs not reported in the “Central de deudores del sistema financiero”. The requirement will be reduced by an amount equivalent to 40% of the peso financing to MSMEs –in accordance with the definition contained in the rules on “Determination of the condition of micro, small or medium-sized enterprise”– that is granted at a nominal annual interest rate of up to 24%, measured as a 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 BCRA. Financing granted to other financial entities and to non-financial credit providers –registered in the corresponding registries enabled by the SEFyC– 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 granting 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.

1.5.8. Financing included in the “Línea de financiamiento para la inversión productiva de MiPyME”. The requirement shall be reduced by an amount equivalent to 14 % of the financings provided for in point 4.1. of the “Financing Line for Productive Investment of MSMEs” that are agreed at a nominal annual interest rate of up to 30 %, measured in monthly average of daily balances of the previous month.

The financings counted for the deduction of points 1.5.1. and 1.5.4. to 1.5.8. may only be counted in one of the aforementioned points. The allocation of the financings of points 1.5.4., 1.5.5. and 1.5.7. shall be adjusted as follows: i. Financings granted up to 15.10.2020 inclusive: their monthly average of daily balances in the previous period shall continue to be counted for the corresponding deduction.

Version: 12th. COMMUNICATION “A” 7161
Effective date:
01/11/2020
Page 15

In the case of financings disbursed from 9.10.2020 and up to 15.10.2020, in both cases inclusive, the financings granted to persons –natural or legal– that:

− belong to sectors of economic activity that have not been considered eligible for any of the benefits of the Emergency Assistance Program for Work and Production (ATP) created by Decree No. 332/2020; and/or

− after 19.3.2020 have imported final consumer goods, except in the case of medical products and/or supplies.

ii. Financings granted from 6.11.2020 inclusive: they shall be voluntary and may not be allocated to the deductions of points 1.5.4., 1.5.5. and 1.5.7.

1.6. Specific increases in requirement due to liability concentration.

When an excessive concentration of liabilities is verified (in holders and/or terms), which implies a significant risk with respect to the individual liquidity of the financial institution and/or has a significant negative effect on systemic liquidity, additional minimum cash requirements may be set on the included liabilities of the financial institution and/or those complementary measures deemed pertinent.

This situation shall be considered to be configured when, among others, any of the following factors is present:

− A high percentage of liabilities is concentrated in the same holder or holders.

− In term obligations, the term is short.

− The aforementioned liabilities represent a significant percentage with respect to the integration of the minimum cash and/or the total private-sector deposits in the institution.

1.7. Transfers.

1.7.1. Admitted margin.

The integration of the minimum cash of the average position of the period may not be less than 80 % of the requirement resulting from the following expression:

EEMA (n) = EEF (n) + ENI (n-1)

Where

EEMA (n): adjusted minimum cash requirement corresponding to period “n”.

EEF (n): minimum cash requirement according to current rules corresponding to pe- riod “n”.

ENI (n-1): requirement not integrated in period “n-1”.

Version: 10th. COMMUNICATION “A” 7161
Effective date:
13/11/2020
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1.7.2. Period of use.

The admitted transfer of the requirement not integrated in each period to the following position may be made up to a maximum of six periods, counted from the first –inclusive– in which its use is opted for in accordance with the provisions above or from the first position immediately following that in which the transferred defects are offset or charges are paid on them.

For its calculation, the numerals transferred from the period to which they correspond shall be counted, divided by the number of days of the period to which the transfer is made.

1.8. Defect in the application of resources in foreign currency.

The defect in the application of resources corresponding to foreign currency deposits, net of cash balances in the institutions, in custody in other financial institutions, in transit and in Securities Carriers (TV), that is determined in a month shall be counted by an equivalent amount in the calculation of the minimum cash requirement of that same period of the respective currency.

Those originating in exchange operations ordered by the National Executive Power are excluded, and consequently may not be offset with purchases of foreign currency.

1.9. Increase in the requirement due to noncompliance with the rules on “Credit line for productive investment”.

The defect in the application of Quota 2013 verified –as of 1.7.13 or 1.1.14, as the case may be, when it is the first tranche and 1.1.14 or 1.7.14, as the case may be, when it is the second tranche– shall be counted by an equivalent amount in the calculation of the minimum cash requirement in average pesos, from said dates and for 24 months.

The defect in the application of Quota 2014 verified –as of 1.7.14 or 1.1.15, as the case may be, when it is the first tranche and as of 1.1.15 or 1.7.15, as the case may be, when it is the second tranche– shall be counted by an equivalent amount in the calculation of the minimum cash requirement in average pesos, from said dates and for 24 months.

Noncompliance with the provisions of the second paragraph of point 3.5.3.2. of the rules on “Credit line for productive investment” (register as of 30.9.14 agreements for at least 50 % of the total amount of the second tranche of Quota 2014 and at least 50 % to MSMEs) shall generate an increase in the minimum cash requirement in average pesos by an equivalent amount from the day following its verification (1.10.14) for 3 months.

Noncompliance with the provisions of the third paragraph of point 3.5.4.1. of the rules on “Credit line for productive investment” (register as of 31.3.15 agreements for at least 30 % of the total amount of the first tranche of Quota 2015) shall generate an increase in the minimum cash requirement in average pesos by an equivalent amount from the day following its verification (1.4.15) for 3 months.

Version: 6th. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 17

Failure to comply with the provisions of the third paragraph of point 3.5.4.2. of the rules on “Credit line for productive investment” (register agreements as of 30.9.15 for at least 30 % of the total amount of the second tranche of the 2015 Quota) will generate an increase in the average minimum cash requirement in pesos for an equivalent amount starting from the day following its verification (1.10.15) for 3 months.

The failure to apply the second tranche of the 2015 Quota verified – as of 1.4.16 or 1.7.16, as the case may be – shall be computed for an equivalent amount in the calculation of the average minimum cash requirement in pesos, starting from those dates and for 24 months.

This is without prejudice to the provisions of point 8.3. of the rules on “Credit line for productive investment”.

Version: 1st. COMMUNICATION “A” 7161
Effective date:
13/11/2020
Page 18

MINIMUM CASH

CONSOLIDATED TEXT			SOURCE RULE				OBSERVATIONS
Sec.	Point	Para.	Com.	Annex	Sec.	Point	Para.
	1.3.8.		“A” 4360			2.		According to Com. “A” 5356 and 6616.
	1.3.9.		“A” 4754			6.		According to Com. “A” 5356, 5980, 6195, 6526, 6532, 6616 and 6728.
	1.3.10.		“A” 5945			4.		According to Com. “A” 6069, 6204 and 6616.
	1.3.11.		“A” 6341					According to Com. “A” 6616.
	1.3.12.		“A” 6069			4.		According to Com. “A” 6616.
	1.3.13.		“A” 6992
	1.3.14.		“A” 5356			1.		According to Com. “A” 6616 and 6706.
	1.3.15.		“A” 6526					According to Com. “A” 6532, 6550, 6587, 6616, 6706 and 7016.
	1.3.16.		“A” 6550					According to Com. “A” 6556, 6559, 6575, 6587, 6616, 6706, 6738, 6740, 6817, 7018, 7029, 7047 and 7092. Includes interpretive clarification.
1.	1.3.	Last	“A” 6526					According to Com. “A” 6532, 6556, 6569, 6575, 6587, 6616, 6628, 6740 and 7016.
	1.4.		“A” 3905			3.		According to Com. “A” 4179, 4449, 4473, 5671, 5740, 6232, 6349, 6719, 6871 and 7046.
	1.5.		"A" 5356			2.		According to Com. "A" 5471.
	1.5.1.		"A" 5356			2.		According to Com. "A" 5471, 5623, 6531, 6703 and 6705.
	1.5.2.		"A" 5631			1.		According to Com. "A" 5638, 6217, 6531, 6857, 6910, 6937 and 7114.
	1.5.3.		"A" 6740			1.
	1.5.4.		"A" 6858			1.		According to Com. "A" 6901 and 6907.
	1.5.5.		"A" 6937			2.		According to Com. "A" 6943, 7054, 7140 and 7155.
	1.5.6.		"A" 6993			2.		According to Com. "A" 7082 and 7157.
	1.5.7.		"A" 7006			2.
	1.5.8.		"A" 7161			5.
	1.5.	last	"A" 6858			2.		According to Com. "A" 6965, 6993, 7006, 7140, 7155 and 7161.
			i) "A" 7132					According to Com. "A" 7140.
			ii) "A" 7140			2.		According to Com. "A" 7157.
	1.6.		"A" 3274	II	1.	1.5.		According to Com. "A" 3498.
	1.7.		"A" 3274	II	1.	1.6.
	1.7.1.		"A" 3274	II	1.	1.6.1.		According to Com. "A" 4405, 4449, 6349, 6719 and 7046.
	1.7.2.		"A" 3274	II	1.	1.6.2.		According to Com. "A" 3304, 4449, 6349 and 6719.
	1.8.		"A" 3498	sole	1.	1.8.		According to Com. "A" 4147, 6537 and 7003.

MINIMUM CASH

CENTRAL BANK OF THE ARGENTINE REPUBLIC

							OBSERVATIONS
CONSOLIDATED TEXT			SOURCE RULE
Sec.	Point	Para.	Com.	Annex	Sec.	Point	Para.
1.	1.9.		"A" 5380				According to Com. "A" 5449, 5516, 5600, 5654 and 5771. Includes interpretive clarification.
	2.1.		"A" 3274	II	2.	2.1.	According to Com. "A" 3498, 3597, 4716, 4815, 6288, 6763 and "B" 9186.
	2.1.1.		"A" 3274	II	2.	2.1.2.	According to Com. "A" 3304, 3498, 4016 and 4147.
	2.1.2.		"A" 3498	sole	2.	2.1.3.	According to Com. "A" 4147.
	2.1.3.		"A" 3274	II	2.	2.1.3.	According to Com. "A" 3498, 4147, 4276 and 5194.
	2.1.4.		"A" 3274	II	2.	2.1.4.
	2.1.5.		"A" 4016			1.
	2.1.6.		"A" 4716		2.		According to Com. "A" 6628 and "B" 9186.
2.	2.2.		"A" 3274	II	2.	2.2.	According to Com. "A" 3498, 4449, 4716, 5299, 6349, 6719 and 6774.
	2.3.		"A" 3365			2.	According to Com. "A" 3387, 3470, 3498, 3549, 3597, 3732, 3824, 4016, 4449, 4716, 5152, 5299, 5373, 6288, 6349, 6575, 6616, 6719, 7046 and "B" 9186.
	2.4.		"A" 4147			3.	According to Com. "A" 4276, 4449, 4509, 5152, 5299, 6349, 6719 and 7046.
	2.5.		"A" 4147			3.	According to Com. "A" 4393, 4509, 4716 and 5299.
	3.1.		"A" 3274	II	3.	3.1.
	3.1.1.		"A" 3274	II	3.	3.1.1.	According to Com. "A" 3326, 3365, 3498, 3549, 3905, 4276, 4449, 4473, 4707, 4716, 4862, 5356, 6349, 6638, 6719 and "B" 9186.
	3.1.2.		"A" 3274	II	3.	3.1.2.
	3.1.3.		"A" 3274	II	3.	3.1.3.	According to Com. "A" 3326.
	3.1.4.		"A" 3274	II	3.	3.1.4.
3.	3.2.		"A" 3274	II	3.	3.2.	According to Com. "A" 6719 and 7046.
	3.2.1.		"A" 3274	II	3.	3.2.2.1.	According to Com. "A" 4449, 6349 and 6719.
	3.2.2.		"A" 3274	II	3.	3.2.2.2.	According to Com. "A" 4449 and 6719.
	3.3.		"A" 3274	II	3.	3.3.	According to Com. "A" 3498.
	3.3.1.		"A" 3274	II	3.	3.3.1.	According to Com. "A" 4771 and 6275.
	3.3.2.		"A" 3274	II	3.	3.3.2.
4.	4.1.		"A" 3274	II	4.	4.1.

MINIMUM CASH

								OBSERVATIONS
ORDERED TEXT			SOURCE STANDARD
Sec.	Point Para.	Com.	Annex Sec.	Point	Para.
5.	5.1.	"A" 3274	II	5.	5.1.		According to Com. "A" 3498, 5693 and 6832.
	5.2.	"A" 3905		5.			According to Com. "A" 5356 and 5693.
	5.3.	"A" 3905		5.			According to Com. "A" 4449 and 6167.
6.	6.1.1.	"A" 5246		3.
	6.1.2.	"A" 5312					According to Com. "A" 5333.
	6.2.	"A" 6884		2.
	6.3.	"A" 7108		2.