JPRF-G-2022-057 — Approves the Budget of the National Financial Corporation B.P. for the 2023 Fiscal Year

Resolution No. JPRF-G-2022-057
THE FINANCIAL POLICY AND REGULATION BOARD
CONSIDERING:
That Article 226 of the Constitution of the Republic of Ecuador provides: "State institutions, their agencies, dependencies, public servants, and persons acting by virtue of state authority shall exercise only the competencies and powers attributed to them in the Constitution and the law. They shall have the duty to coordinate actions to fulfill their purposes and to make effective the enjoyment and exercise of rights recognized in the Constitution."; That Article 309 of the Constitution of the Republic stipulates that entities regulating the national financial system shall be responsible for "preserving its security, stability, transparency, and solidity."; That Article 310 of the Magna Carta mandates: "The public financial sector shall aim to provide sustainable, efficient, accessible, and equitable financial services. The credit it grants shall be oriented preferentially to increase the productivity and competitiveness of productive sectors that allow achieving the objectives of the Development Plan and of less favored groups, in order to promote their active inclusion in the economy"; That Article 13 of the Organic Code of Monetary and Financial Law, Book I, created the Financial Policy and Regulation Board as part of the Executive Function, responsible for the formulation of credit, financial, securities, insurance, and prepaid health service regulation policy; That Article 14.1, letter a, number 14 ibidem, states that it is a faculty of the Financial Policy and Regulation Board: "To annually approve the budget of public sector financial entities, their reforms, as well as to regulate their execution; (...)"; That the First Transitional Provision of the Organic Law for Economic Development and Fiscal Sustainability, published in the Official Register Supplement No. 587 of November 29, 2021, mandates: "In order to achieve the technical and capital parameters necessary to grant low-cost, long-term credit to the agricultural and productive sectors, within sixty (60) days counted from the publication of this law in the Official Register, the competent instances shall initiate the pertinent procedures to merge BANECUADOR EP [sic] and the NATIONAL FINANCIAL CORPORATION EP [sic] into a single entity called ECONOMIC DEVELOPMENT BANK OF ECUADOR". That, with Resolution No. JPRF-G-2022-016 of January 13, 2022, the Financial Policy and Regulation Board approved the budget for the 2022 fiscal year of the National Financial Corporation B.P.; That, through Executive Decree No. 406, signed on April 25, 2022, and published in the Official Register Supplement 57 of May 6, 2022, the merger procedure is implemented "in an ordinary manner between the National Financial Corporation B.P. and BANECUADOR B.P., within the timeframe provided in the present Executive Decree, to create the Economic Development Bank of Ecuador B.P."; That the Financial Policy and Regulation Board, on September 29, 2022, issued Resolution No. JPRF-F-2022-037 which prescribes the
applicable regulation for the budget cycle stage of budget proposal approval. The First Transitional Provision of said resolution states: "The budgets submitted for approval by the Financial Policy and Regulation Board of BANECUADOR B.P. and NATIONAL FINANCIAL CORPORATION B.P. for the 2023 fiscal year must consider aspects that guarantee the efficient use of resources, taking into account the merger process that will take place between said entities."; That, through Letter No. CFN-B.P.-GG-2022-0639-OF of December 9, 2022, addressed to the Financial Policy and Regulation Board, the Acting General Manager of the National Financial Corporation B.P., Econ. Virna Rossi Flores, submits the "Budget Proposal of the National Financial Corporation B.P. for the year 2023, duly approved by the Institution's Board of Directors in a session held on December 9, 2022, through Resolution No. DIR-118-2022, as well as the technical and legal reports required for this effect."; That the Technical Secretariat of the Financial Policy and Regulation Board, through Memorandum No. JPRF-SETEC-2022-0095-M of December 28, 2022, sends to the President of the Board the following reports:
i. Technical Report No. JPRF-CT-2022-0049 of December 28, 2022, considering the favorable pronouncement of the members of the Board of Directors of the National Financial Corporation B.P. in the Board Session of December 9, 2022, with Resolution No. DIR-118-2022, and the review of the figures presented through Letter No. CFN-B.P.-GG-2022-0639-OF and its annexes by the National Financial Corporation B.P. to the Financial Policy and Regulation Board, it is recommended to approve the budget proposal for the 2023 fiscal year.
ii. The Legal Report No. JPRF-CJ-2022-0058 of December 28, 2022 concludes that it corresponds to the Financial Policy and Regulation Board to approve the budget of the National Financial Corporation B.P. for the 2023 fiscal year, which was sent by its General Manager through Letter No. CFN-B.P.-GG-2022-0639-OF of December 9, 2022, in accordance with Article 14.1, numeral 14, literal a. of the Organic Code of Monetary and Financial Law, Book I;
That the Financial Policy and Regulation Board, in an extraordinary session convened by technological means on December 29, 2022, and carried out via video conference on December 30, 2022, reviewed Memorandum No. JPRF-SETEC-2022-0095-M of December 28, 2022, issued by the Technical Secretariat of the Board; as well as Technical Report No. JPRF-CT-2022-0049 and Legal Report No. JPRF-CJ-2022-0058 of December 28, 2022, issued by the Legal Coordination and Technical Coordination of the aforementioned Board, and the corresponding draft Resolution; That the Financial Policy and Regulation Board, in an extraordinary session convened by technological means on December 29, 2022, and carried out via video conference on December 30, 2022, reviewed and approved the following Resolution; and, In exercise of its functions, RESOLVES:
SINGLE ARTICLE.- Approve the budget of the National Financial Corporation B.P. for the 2023 fiscal year, under the terms indicated by the General Manager in Letter No. CFN-B.P.-GG-2022-0639-OF of December 9, 2022, which are derived from the Annex that forms part of this Resolution.

Resolution No. JPRF-G-2022-057

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GENERAL PROVISIONS
FIRST.- The legal representative of the National Financial Corporation B.P. shall be responsible, within the framework of the Law, for the execution of the budget. Budget execution must consider aspects that guarantee the efficient use of resources, taking into account the merger process that will take place between BANECUADOR B.P. and the NATIONAL FINANCIAL CORPORATION B.P.
SECOND.- It is ordered that the National Financial Corporation B.P. submit the approved budget for the 2023 fiscal year to the Ministry of Economy and Finance and to the National Assembly within a term of 30 days, counted from the issuance of this Resolution, in compliance with what is established in Articles 112 of the Organic Code of Public Planning and Finance and 94 of its General Regulation. FINAL PROVISION.- This Resolution shall enter into force from the present date, without prejudice to its publication in the Official Register, and shall be published on the institutional website of the Financial Policy and Regulation Board within a maximum term of two days from its issuance. NOTIFY.- Given in the Metropolitan District of Quito, on December 30, 2022. THE PRESIDENT, Mgs. María Paulina Vela Zambrano The aforementioned Resolution was processed and signed by Master María Paulina Vela Zambrano, President of the Financial Policy and Regulation Board, in the Metropolitan District of Quito, on December 30, 2022.- I CERTIFY. TECHNICAL SECRETARIAT Dr. Nelly Arias Zavala

Resolution No. JPRF-G-2022-057

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ANNEX
Institutional Budget of the National Financial Corporation B.P. for the 2023 Economic Year In millions of dollars Source: Letter No. CFN-B.P.-GG-2022-0639-OF of December 9, 2022