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CENTRAL BANK OF THE ARGENTINE REPUBLIC

COMMUNICATION “A” 4665 11/05/2007

TO FINANCIAL ENTITIES:

Reference: Circular
LISOL 1 - 470
OPRAC 1 - 604

Minimum capital of financial entities. Credit policy. Classification of debtors. Update.

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We address you to send the attached pages, which, in replacement of those previously provided, must be incorporated into the ordered texts of the reference for the purpose of their update.

Also, it is reminded that on the Institution’s website www.bcra.gov.ar, accessing “normativa” (“ordered texts”), the modifications made will be found with texts highlighted in special characters (strikethrough and bold).

We greet you very attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Darío C. Stefanelli – Issuance Manager of Standards José I. Rutman – Deputy General Manager of Standards

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ANNEX

7.1. Determination.

The patrimonial responsibility computable of financial entities, for the purposes of the regulatory rules of the prescriptions of articles 30 and 32 of the Financial Entities Law and other provisions of the Central Bank of the Argentine Republic that refer to that concept, shall arise from the following expression:

```
RPC = PNb + PNc – Cd
```

Where:

• RPC: computable patrimonial responsibility.
• PNb: basic net equity.
• PNc: complementary net equity, not exceeding 100% of PNb.
• Cd: concepts that must be deducted.

7.2. Computable concepts.

7.2.1. Basic net equity.

It includes the following items of net equity:

1. Social capital.
2. Non‑capitalized contributions.
3. Adjustments to equity.
4. Profit reserves.
5. Undistributed results. The positive result of the last closed fiscal year will be computed once the auditor’s report is available.
6. Debt‑representative instruments, issued under the conditions established in point 7.2.2.

In addition, the following amounts will be computed off‑balance‑sheet – according to the provision in sub‑paragraph xiii) of point 7.2.2.1 – the respective reserve funds that are effectively applied to the payment of financial services, in case of insufficiency of distributable results according to the established procedure, provided that their maturities occur before 31‑12‑2012.

The remaining reserve fund will also be computed from that date.

The total of this concept will be subject to not exceeding, over the basic net equity – items 7.2.1.1 to 7.2.1.7 – the percentages detailed below:

MINIMUM CAPITAL OF FINANCIAL ENTITIES
B.C.R.A.
Section 7. Computable patrimonial responsibility. Version: 6a. COMMUNICATION “A” 4665 Effective: 01/10/2006

• i) 30 % until 31‑12‑2008,
• ii) 25 % until 31‑12‑2010,
• iii) 20 % until 31‑12‑2012 and
• iv) 15 % from 01‑01‑2013.

In consolidation cases, also include:
7.2.1.7. Third‑party participation.

Balances arising from the application of the presumed minimum profit tax – net of devaluation risk provisions – that exceed 10 % of the amount resulting from the sum of the concepts contained in points 7.2.1.1 to 7.2.1.7 or 10 % of the computable patrimonial responsibility of the previous month, whichever is lower, will be deducted.

7.2.2. Debt‑representative instruments.

For their computation in the computable patrimonial responsibility they must be fully subscribed and integrated and observe the following requirements:

7.2.2.1. Issuance conditions that must be included in the publicly disclosed prospectuses.

1. They must have prior authorization from the shareholders’ meeting or equivalent corporate body at the time of issuance.
2. They must be denominated in pesos or foreign currency.
3. The payment of the remuneration may in no case exceed the positive, cleaned, undistributed results based on the accounting statements of the last annual fiscal year with an external auditor’s report, closed immediately before the maturity of each financial service, calculated according to the specific procedure for the payment of financial services provided in Section 3 of the “Distribution of Results” rules. The amount must be allocated to the constitution – according to that methodology – of a reserve intended for that purpose in pesos, regardless of the currency in which the instrument was issued.

The reserve destined for the payment of financial services whose maturity occurs in the period from the issuance date of the debt instrument up to the day before the second shareholders’ meeting or equivalent corporate body after the issuance must be constituted with cleaned undistributed results based on the accounting statements considered at the first shareholders’ meeting or equivalent corporate body held after the issuance.

If the remuneration is subject to a fixed rate, the reserve will include the yields to be paid. If it is subject to a variable rate or exchange‑rate variations, the reserve must be constituted applying the rate or exchange rate in force at the moment of its constitution, which may be higher to consider a possible increase in projected services.

Financial services will accrue monthly. The total accrued amount may not exceed the aforementioned reserve, except in the following cases:

• when the instrument contemplates the accumulation of unpaid services;
• if the remuneration is subject to a variable rate or exchange‑rate variations and the reserve proves insufficient due to the observed increase versus projections, the insufficiency may be covered with the results of the fiscal year to which the services belong, provided that positive cleaned undistributed results remain from the immediately preceding annual fiscal year and prior approval of the Superintendency of Financial and Currency Entities, which will evaluate the correct application of the established procedure;
• if a sufficient reserve fund exists under sub‑paragraph xiii).

4. They must have a term of not less than 30 years, with full amortization at maturity.
5. Payments of financial services may not be made with a frequency less than quarterly.
6. Redemption of the obligation, if foreseen, may only be carried out at the issuer’s option provided that:
   a) at least 5 years have elapsed since its integration, b) it has prior authorization from the Superintendency of Financial and Currency Entities before exercising the option, and c) it is replaced by any of the concepts included in points 7.2.1.1 or 7.2.1.6.
7. An increase in the rate to be paid will be admitted only once during the life of the instrument and after 10 years from its integration.
8. It must not contain clauses that guarantee or cover the issuer or linked parties in a way that affects the order of precedence contemplated in the following sub‑paragraph.
9. It must provide that, in case of bankruptcy of the entity and once all debts to other creditors (including contractually subordinated debt) are satisfied, the holders will have precedence only over shareholders – regardless of share class – with an explicit waiver of any general or special privilege.
10. It must not contain clauses that declare the obligation to be due in case of non‑payment of its financial services or other debts for any reason, except bankruptcy.
11. Payment of each financial service does not require prior authorization from the Superintendency of Financial and Currency Entities. However, payment may only be made if the corresponding reserve has been constituted and it has prior authorization from that Superintendency according to the procedure set out in Section 3 of the “Distribution of Results” rules – except for the case of remuneration subject to a variable rate or exchange‑rate variations as provided in sub‑paragraph iii) – or, alternatively, with the reserve fund referred to in sub‑paragraph xiii).

In no case will payment of financial services be admitted while the entity:

• i) presents minimum cash deficiencies on average – in pesos or foreign currency –, and/or
• ii) records financial assistance due to illiquidity from the Central Bank of the Argentine Republic, except assistance received under article 17 of the Organic Charter, adjusted to Decree 739/03 and its regulations (Communication “A” 3941 and complements) and the operation foreseen by Communication “A” 4268 and complements, and/or
• iii) is complying with a regularization and sanation plan under article 34 of the Financial Entities Law.

For instruments that contemplate the accumulation of unpaid services, financial services may not be paid unless there is a balance in the respective reserve.

12. Unpaid services will not be cumulative, therefore they cannot be deferred and accumulated for later payment, except as provided in sub‑paragraph iv), item c), of point 7.2.2.4.
13. If a reserve fund is foreseen, it must be integrated at the time of subscription and may not exceed 10 % of the respective issuance.

These amounts may be used for the payment of financial services that mature up to 31‑12‑2012 when cleaned undistributed results are not available according to the specific procedure for the payment of financial services provided in Section 3 of the “Distribution of Results” rules.

This reserve fund will be part of the liability, without prejudice to its off‑balance‑sheet computation as computable patrimonial responsibility according to sub‑paragraph iii), item a), of point 7.2.2.4.

In case of bankruptcy, this fund will be subject to the collection precedence provided in sub‑paragraph ix).

14. They must have authorizations both for public offering and for quotation on stock exchanges or self‑regulated markets of the country or abroad.

7.2.2.2. Prior authorization.

Computation as computable patrimonial responsibility will only be admitted if prior authorization to the issuance is obtained from the Superintendency of Financial and Currency Entities, whose intervention will aim to verify compliance with the enumerated requirements and, in particular, that the entity meets the minimum capital requirement.

The documentation delivered to subscribers must expressly state that the mentioned authorization is granted solely for the purpose of computing the respective instrument in the computable patrimonial responsibility of the issuing entity.

The Superintendency shall issue the authorization within 30 business days counted from the date it considers the submission of information and other pertinent elements related to the authorization request to be complete.

7.2.2.3. Purchase and re‑placement. Prohibition.

Financial entities may not purchase for later re‑placement their own emissions of debt‑representative instruments that have been or are considered for the determination of computable patrimonial responsibility.

They may also not acquire emissions issued by other financial entities.

7.2.2.4. Computable amounts.

1. If placement is at par: For the determination of computable patrimonial responsibility, the amount actually received will be taken into account, i.e., after deducting issuance discounts; commissions retained by the intervening placement agent are not considered discounts.

2. Instruments issued in foreign currency: They will always be computed at the peso value according to the exchange rate on the placement date.

3. Reserve fund:
   a) Amounts of these funds that are effectively applied to the payment of financial services before 31‑12‑2012 will be computed off‑balance‑sheet, to the extent that there are not sufficient distributable results according to the determination made under the specific procedure in Section 3 of the “Distribution of Results” rules.

   From that date, amounts that have not been used may also be computed as basic net equity, provided the limits set in point 7.2.1.6 are not exceeded; any excess may be computed, if applicable, as complementary net equity.

   b) Before 31‑12‑2012, the remaining reserve fund cannot be computed for the purpose of determining computable patrimonial responsibility.

   c) If applicable according to a), this fund will be computed at the peso value of the services cancelled with attribution to its use.

4. As complementary net equity:
   a) Debt‑representative instruments and the amounts of their respective reserve funds – applied to financial services before 31‑12‑2012 and, from that date, also the amounts not used – to the extent they exceed the limits set in point 7.2.1.6.

   b) Debt‑representative instruments with a residual term of less than 10 years.

   c) Debt‑representative instruments when unpaid financial services are cumulative.

   Starting from the beginning of each of the last five years of life of each issuance, the computable amount will be reduced by 20 % of the nominal value issued.

The total of debt‑representative instruments and their respective reserve funds computed as complementary net equity, together with debt securities contractually subordinated to other liabilities, may not exceed 50 % of the basic net equity.

7.2.2.5. Lack of payment of financial services.

The mere lack of payment of any non‑exigible service – due to the absence of positive cleaned undistributed results or reserve fund – will not be considered a cause for revocation of the authorization to operate as a financial entity, provided that:

1. Other non‑subordinated obligations are normally met,
2. No cash dividends are distributed to shareholders, and
3. No fees are paid to directors and auditors, except when they perform executive functions.

7.2.2.6. Cancellation of the reserve.

The reserve will be written‑off with a counterpart in cleaned undistributed results at the time of each accrual and/or the payment of financial services, whichever occurs first. If a balance remains in the reserve, it must be reversed before the next shareholders’ meeting.

7.3. Complementary net equity.

It comprises the positive or negative result of the algebraic sum of the following concepts:

7.3.1. Contractually subordinated obligations:

1. To other liabilities, issued under the conditions set out in point 7.2.4 (+).
2. Debt‑representative instruments and amounts of their respective reserve funds, as contemplated in point 7.2.2.4 iv (+).

7.3.2. 100 % of the results recorded up to the last quarterly accounting statement that has an auditor’s report, corresponding to the last closed fiscal year and for which the auditor has not yet issued his opinion (+ / -).

7.3.3. 100 % of the results of the current fiscal year recorded at the close of the last quarterly accounting statement, once the auditor’s report is available (+ / -).

7.3.4. 50 % of profits or 100 % of losses, from the last quarterly or annual accounting statement that has an auditor’s report or opinion. These percentages will be applied over the accumulated net balance calculated at the end of each month, unless the provisions of the two preceding paragraphs apply (+ / -).

7.3.5. 100 % of the losses not reflected in the accounting statements, corresponding to the quantification of facts and circumstances reported by the auditor, as provided in the Minimum Standards on External Audits regarding limited‑review reports at the close of each quarter (-).

7.3.6. Provisions for credit‑risk on the portfolio corresponding to debtors classified as “in normal situation” or “normal compliance” and financings covered with preferred “A” guarantees (only 50 % of the minimum required amount) (+).

For the purpose of computing 100 % of the results recorded up to the last quarterly or annual balance, the respective accounting statement with the auditor’s report must be presented by the date the monthly balance is obligatorily submitted.

7.4. Computable subordinated debt.

Debt securities or other obligations of the entity, contractually subordinated to other liabilities, that are admitted for computation in order to determine computable patrimonial responsibility, must have authorizations both for public offering and for quotation on stock exchanges or self‑regulated markets of the country or abroad (for issuances after 30‑09‑2006) and must observe the following requirements:

7.4.1. Issuance conditions.

1. The weighted average life at issuance must not be less than 5 years.
   The weighted average life is calculated by dividing by 365 the sum of the days between the issuance date and the maturity date of each capital amortization service, multiplied by the proportion that each service represents of the total instrument, considered at its nominal value.

   If the interests foreseen in the issuance are, at the discretion of the Superintendency of Financial and Currency Entities, markedly higher than those usually established in similar issuances, the “duration” method will be used to determine the average life. This method weights the number of days between issuance and each future service’s maturity (capital and interest) by the economic value proportion of each service relative to the instrument’s economic value, using the net present value of future cash flows discounted at the internal rate of return.

2. Early redemption of the obligation, if foreseen, may only be exercised at the debtor’s option provided that:
   a) prior authorization from the Superintendency of Financial and Currency Entities is obtained before exercising the option, and b) the computable patrimonial responsibility after redemption remains equal to or greater than the minimum capital requirement.

3. Conversion into shares of the issuer, if foreseen, may be carried out according to the contractual terms, under any of the following possibilities:
   a) only at the debtor’s option, b) only at the creditor’s option, or c) at the option of either party, indistinctly.

4. The instrument must not contain clauses that declare the obligation to be due in case of non‑payment of amortization or interest services or other debts for any reason, except bankruptcy.

5. The instrument must provide that, in case of bankruptcy of the entity and once all debts to non‑subordinated creditors are satisfied, the holders will have precedence only over shareholders – regardless of share class – with an explicit waiver of any general or special privilege.
   Additionally, it will be established that such distribution will be made among all subordinated debts proportionally to the verified liabilities.

6. They may have an interest coupon linked to the results of the financial entity.

7.4.2. Computable amount.

Starting from the beginning of each of the last five years of life of each issuance, the computable amount will be reduced by 20 % of the nominal value issued net of amortizations actually performed.

In no case may the computable amount at the start of each of those periods be greater than the result of applying that percentage cumulatively to the residual obligation at the end of each year, according to the capital amortization service schedule.

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Minimum Capital of Financial Entities – B.C.R.A.

Section 7. Computable Patrimonial Responsibility

Version: 2a. COMMUNICATION “A” 4665
Effective Date: 01/10/2006

The total of this concept, together with debt representative instruments and their respective reserve funds counted as complementary net equity, may reach up to the equivalent of 50 % of basic net equity.

If the placement is made at par, for the determination of computable patrimonial responsibility the amount actually received will be taken into account, i.e., after deducting issuance discounts; commissions retained by the intervening placement agent are not considered such discounts.

Subordinated debt issued in foreign currency from 01‑Oct‑2006 will be computed at all times at the peso value using the exchange rate applicable on the placement date. The computable amount will be reduced proportionally to the amortizations that are actually carried out.

7.2.4.3. Prior Authorization

The computation as complementary net equity will only be admitted if prior authorization from the Superintendence of Financial and Currency Entities is obtained, whose intervention will be aimed at verifying compliance with the enumerated requirements and, in particular, that the entity meets the minimum capital requirement.

If the Superintendence does not expressly issue the authorization within 30 calendar days counted from the date of submission by the entity, the authorization shall be deemed granted.

7.2.4.4. Failure to Pay Services

The mere failure to pay any of the amortization or interest services on subordinated debts shall not be considered a cause for revocation of the authorization to operate as a financial entity, provided that:

1. the method to extinguish the unpaid obligation is determined within the year after its due date,
2. the other non‑subordinated obligations are met normally,
3. no cash dividends are distributed to shareholders, and
4. no fees are paid to directors and auditors, except when they perform executive functions.

Non‑compliance with these requirements by the entity will not entail any liability for the Central Bank of the Argentine Republic; this must be expressly stated in offering prospectuses and in the issued instrument.

7.2.4.5. Purchase and Re‑allocation – Prohibition

Financial entities may not purchase for later re‑allocation their own subordinated debt emissions that have been or are considered for the determination of computable patrimonial responsibility.

They also may not acquire, from 01‑Oct‑2006, emissions made by other financial entities.

7.2.4.6. Concept of Subordination

A debt is considered subordinated with respect to other liabilities when, under equal conditions regarding possible privileges or among unsecured creditors, the creditor of that debt agrees to grant pre‑ference in the collection of the claim, in case of the debtor’s bankruptcy, to the other liabilities under equal conditions. In the regulated case, this characteristic implies the situation described in point 7.2.4.1.v) above.

7.2.5. Deductible Concepts

7.2.5.1. Balances in Correspondent Accounts and Other Sight‑Deposits at Foreign Banks and Financial Institutions that do not have an international risk rating in the “investment grade” category, as granted by any of the rating agencies admitted by the “Evaluation of Financial Entities” rules.

The deduction will be made based on the largest balance in each bank recorded during the month to which the computable patrimonial responsibility determination applies.

For this purpose, balances in correspondent accounts and other sight‑deposits shall not be deducted when they relate to:

a) the head office of local branches of foreign banks or their subsidiaries in other countries, insofar as the head office is subject to consolidated supervision;

b) foreign banks or other financial institutions subject to consolidated supervision that control locally incorporated financial entities organized as corporations;

c) other foreign banks authorized to intervene in reciprocal payment and credit agreement regimes to which the Central Bank of the Argentine Republic has adhered, as well as their branches and subsidiaries, even when they are not included in those regimes, provided that the head office or controlling banking entity is subject to consolidated supervision regimes satisfactory to the Superintendence of Financial and Currency Entities;

d) branches and subsidiaries of local financial entities subject to the consolidated supervision regime;

e) balances that, transitorily and circumstantially, arise from client operations, such as those linked to foreign trade operations or other types of credit ordered by third parties that do not entail patrimonial responsibility for the entity.

Notwithstanding the provisions of this point, financial entities must open, for each of their foreign correspondents, a file containing the information and other elements that allow identification, rating, credit limits and any other data linked to that relationship.

7.2.5.2. Credit Instruments (securities, fixed‑term deposit certificates and others) that are physically not in the possession of the entity, unless their registration or custody of registration certificates or book‑entry securities is entrusted to:

i) Central Bank of the Argentine Republic, for operations channeled through the Central Registry and Settlement of Public Liabilities and Financial Trusts ("CRYL");

ii) Caja de Valores S.A.;

iii) Cedel, Euroclear and Depositary Trust Company (DTC);

iv) Deutsche Bank, New York.

If deductible assets are maintained under this provision, the entity must note the existence of such concepts in the notes to the quarterly and annual financial statements, quantifying the amount that is not admitted for the purpose of determining computable patrimonial responsibility.

7.2.5.3. Securities Issued by Foreign Governments whose international risk rating is lower than that assigned to Argentine national public securities and that do not have markets where they are regularly traded in significant volumes.

The deduction will be made for the amount of the largest balance recorded during the month to which the computable patrimonial responsibility determination applies.

7.2.5.4. Securities and Other Debt Instruments, contractually subordinated to other liabilities, issued by other financial entities that were acquired up to 30‑Sep‑2006.

The deduction will be made for the amount of the largest balance recorded during the month to which the computable patrimonial responsibility determination applies.

7.2.5.5. Participation in Financial Entities, except when franchises apply that prevent deduction, net of:

i) depreciation risk provisions, and

ii) when the participating entity is controlled and the 50 % of its earnings rule in point 7.2.3.4 applies proportionally to the participation.

7.2.5.6. Participation in Foreign Financial Entities, net of:

i) depreciation risk provisions, and

ii) when the participating entity is controlled and the 50 % of its earnings rule in point 7.2.3.4 applies proportionally to the participation.

7.2.5.7. Participation linked to the deferral of tax payments, incorporated up to 19‑Feb‑1999, or thereafter when arising from irrevocable subscription commitments instrumented up to that date, starting from the month following the legal unavailability or decay deadline, regardless of the reason for the tax benefit, according to the pertinent legal and regulatory provisions.

7.2.5.8. Shareholders.

7.2.5.9. Real Estate, regardless of the date of its incorporation into equity, whether or not used for the entity’s operation, whose accounting registration is not supported by the corresponding deed of transfer duly registered in the Property Registry, except those acquired through judicial auction.

The deduction shall be equivalent to 100 % of the value of such assets from their incorporation into equity until the month preceding the regularisation of that situation.

The Superintendence of Financial and Currency Entities may order exclusions in this matter, provided they do not distort the purpose of the deduction.

7.2.5.10. Business Key (incorporations registered from 30‑May‑1997).

7.2.5.11. Organization and Development Expenses, except concepts expressly established as non‑deductible, net of accumulated amortisation.

7.2.5.12. Pending Allocation Items – Debit Balances – Others.

7.2.5.13. Upon request from the Superintendence of Financial and Currency Entities, and effective on the date indicated in each case, financial entities must deduct the amounts of the assets covered when the information provided to the inspecting officials shows that the entities’ accounting records do not accurately reflect the economic and legal reality of the operations or that actions have been taken to disguise the true nature or scope of the operations.

The impact on computable patrimonial responsibility resulting from the application of the foregoing shall determine the obligation to verify the classification of the various rules that use the cited responsibility as a basis, from the month the request takes effect, and, where applicable, the resulting charges must be entered within 10 business days from the notification date. If entry occurs after the deadline, the corresponding late‑payment interest shall be payable.

7.2.5.14. Differences due to insufficient constitution of minimum provisions for credit‑risk loss, as determined by the Superintendence of Financial and Currency Entities, insofar as they have not been accounted for, effective at the close of the month following the month in which the entity receives the notification referred to in the first paragraph of point 2.7 of Section 2 of the “Minimum Provisions for Credit‑Risk Loss” rules.

7.2.5.15. Participation in companies whose corporate purpose is the development of any of the following activities:

i) Financial assistance through leasing of durable capital goods and real estate, acquired for that purpose ("leasing") or on credit arising from sales ("factoring");

ii) Transitory acquisition of participations in companies to facilitate their development, with the aim of later selling the holdings. Granting financing and advisory services in planning and management to those companies.

The computation shall be made net of depreciation risk provisions.

7.2.5.16. Shares or participations in the capital of companies received as payment for credits, whose holding exceeds the maximum periods established for liquidation in points 9.1.1 and 9.1.2 of Section 9 of the “Credit Grading” rules.

The deduction shall be made for the amount that exceeds the maximum admissible holding limit.

7.3. Capital Contributions

For all regulations related to capital, its integration and increase, including those concerning regularisation and restructuring plans, and without prejudice to point 1.1 of Section 1 of Chapter V of Circular CREFI‑2 (text according to Communication “A” 4510) regarding the negotiation of shares or irrevocable contributions for future capital increases, contributions must be made in cash.

Exceptionally, with prior authorization from the Superintendence of Financial and Currency Entities, contributions may be admitted in:

1. National public securities;
2. Debt instruments of the Central Bank;
3. Deposits and other obligations arising from the financial intermediation of the entity.

In cases covered by points 7.3.1 and 7.3.2, contributions shall be recorded at market value. An instrument is considered to have market value when it has a regular quotation on domestic or foreign regulated exchanges, with relevant transactions such that its eventual liquidation would not significantly distort its quotation.

For point 7.3.3, contributions shall be recorded at market value (as defined above) or, when the financial entity conducts a public offering of its shares, at the price set by the competent supervisory authority of the corresponding market. Contributions of this type shall not be admitted when the aforementioned conditions are not met.

Effective Date: 11‑May‑2007

When deposits and other obligations arising from the financial intermediation of the financial entity – including subordinated obligations – do not have authorization to be traded on regulated secondary markets, contributions shall be admitted at book value (capital, interest, adjustments, foreign‑exchange quotation differences and, where applicable, issuance discounts), in accordance with the regulations of the Central Bank of the Argentine Republic.

In no case may debt capitalisation limit or suspend the preferential right established in article 194 of the Commercial Companies Law, and therefore the provisions of article 197 of that law shall not apply.

The decision to capitalise the concepts indicated in points 7.3.1 to 7.3.3 by the Assembly (or equivalent authority) shall be ad referendum of its approval by the Superintendence of Financial and Currency Entities or, where appropriate, by the Central Bank of the Argentine Republic – as provided in point 1.1 of Section 1 of Chapter V of Circular CREFI‑2 – a circumstance that must be disclosed in the notes to the financial statements of the subsequent periods (quarterly or annual, as appropriate), under the terms set by the Superintendence of Financial and Currency Entities.

Until the approval of the contributions is notified and insofar as they have been accounted for, they shall be deducted from the computable patrimonial responsibility of the financial entity. When the accounted contributions arise from the capitalisation of subordinated debt or debt‑representative instruments that may be considered – wholly or partially – as part of the computable patrimonial responsibility, the treatment applicable to liabilities shall be maintained.

7.4. Procedure

The request for authorization of capital contributions involving the instruments referred to in points 7.3.1 to 7.3.3 must be accompanied by a copy of the Assembly (or equivalent authority) minutes certified by a public notary, indicating that decision, and, for its adoption, the Assembly must have at its disposal the special external auditor report required for cases where the contribution includes the debt instruments mentioned in the following paragraph.

When the capital contributions referred to in point 7.3.3 are involved, the debt instruments must be recorded in the last annual or quarterly balance sheet, as appropriate, immediately prior to the date of convening the relevant Assembly. That financial statement must include the external auditor’s intervention as required for each case according to the applicable auditing standards and must have been previously submitted to this Institution, accompanied by a special auditor’s report prepared in the terms specifically established in the Minimum Standards on External Audits issued by the Superintendence of Financial and Currency Entities.

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Ordered Text – Source Norm

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CAPITALES MÍNIMOS DE LAS ENTIDADES FINANCIERAS TEXTO ORDENADO NORMA DE ORIGEN Sección Punto Párrafo Com.
Cap./
Anexo
Punto Párrafo
Observaciones
5.
5.6. “A” 2922 I Modificado por Com. “B” 6523 y “A”
4172. Punto 5.6.4.5. modif. por
Com. “A” 3274, “A” 3959, “A” 4180 y “A” 4543.
6.1. y
6.2.
“A” 2461 único I. y II. Según Com. “A” 4172.
6.3. y
6.4.
“A” 2461 único I. y II. Según Com. “A” 3959 y “A” 4172.
6.5. “A” 2461 único I. y II. Modificado por las Com. “A” 2736,
2768, 2948, 3959 y 4172. El punto
6.5.2. incluye aclaración interpretativa.
6.6. “A” 2461 único III. Según Com. “A” 3161 y “A” 4172.
6.7. “A” 2461 único VI. Según Com. “A” 4172.
6.
6.8. “A” 2461 único VII. Según Com. “A” 4172.
7.1. “A” 414
LISOL-1
VI 3.1. 1º Según Com. “A” 2279, (mod. por las Com. “A” 2453, 2793, 2914, 3039 y 4172).
7.2.1. “A” 414
LISOL-1
VI 3.1.1. Según Com. “A” 2223 (modificado por la Com. “A” 2227 y “A” 4296, punto 2.), 4576 (punto 1.) y 4665.
7.2.2. “A” 4576 2. Según Com. “A” 4591 (puntos 2.,3.,
4. y 5.) y 4665 -el punto 7.2.2.5.
incluye aclaración interpretativa-.
7.2.3. “A” 414
LISOL-1
VI 3.1.2. Según Com. “A” 2223. Modificado por las Com. “A” 2768, 2948, 4172, 4576 (punto 3.) y 4665.
7.2.4. 1º “A” 414
LISOL-1
VI 3.1.2.2. Según Com. “A” 2264, 4172 y 4576
(punto 4.).
7.2.4.1. y
7.2.4.2.
“A” 414
LISOL-1
VI 3.1.2.2. Según Com. “A” 2264, 4172 y 4576
(puntos 5. y 6.).
7.2.4.3. y
7.2.4.4.
“A” 414
LISOL-1
VI 3.1.2.2. Según Com. “A” 2264 y 4172. En el segundo párrafo del punto 7.2.4.3. incorpora aclaración interpretativa.
7.2.4.5. “A” 2264 2. Según Com. “A” 4172 y 4576 (punto 8.).
7.2.4.6. “A” 414
LISOL-1
VI 3.1.2.2. Según Com. “A” 2264, 4172 y
4665.
7.2.5.1. “A” 2287 3.1. y
3.3.
Según Com. “A” 2890 y 4172.
“A” 2287 3. último Según Com. “A” 4172.
7.2.5.2. 1º “A” 2497 1. Según Com. “A” 3621 y 4172.
último “A” 2263 2. Según Com. “A” 4172.
1ºy
último
“A” 2287 3.2. Según Com. “A” 4172.
7.
7.2.5.3.
2º “A” 2474 Normas de procedimiento sobre exigencia e integración de capitales mínimos (punto 3.2.7). Modificado por Com.“A” 4172.

CAPITALES MÍNIMOS DE LAS ENTIDADES FINANCIERAS TEXTO ORDENADO NORMA DE ORIGEN Sección Punto Párrafo Com.
Cap./
Anexo
Punto Párrafo
Observaciones
7.2.5.4. “A” 2264 1. Según Com. “A” 4172 y 4576
(punto 7.).
7.2.5.5. “A” 414
LISOL-1
VI 3.2. Según Com. “A” 4172, 4539 y
4665.
“A” 1215 Especificaciones de las partidas de participaciones en entidades financieras no deducibles para determinar la responsabilidad patrimonial computable. Según Com. “A” 4172.
7.2.5.6. “A” 414
LISOL-1
VI 3.2. Según Com. “A” 4172, 4539 y
4665.
7.2.5.7. “A” 2863 3. Según Com. “A” 4172.
7.2.5.8. “A” 414
LISOL-1
VI 3.2. Según Com. “A” 4172.
7.2.5.9. “A” 2730 Incorpora aclaración interpretativa. Según Com. “A” 4172.
7.2.5.10. “A” 2545 Según Com. “A” 4172.
7.2.5.11. “A” 414
LISOL-1
VI 3.2. Modificado por la Com. “A” 986 y
“A” 4172.
7.2.5.12. “A” 414
LISOL-1
VI 3.2. Según Com. “A” 4172.
7.2.5.13. “A” 2287 4. Según Com. “A” 4172.
“A” 2607 1. Según Com. “A” 4172.
7.2.5.14. “A” 2893 1. Según Com. “A” 4172.
7.2.5.15. “A” 3087 Según Com. “A” 4172.
7.2.5.16. “A” 3918 Según Com. “A” 4172.
7.3. “A” 414
LISOL-1
VI 3.4. Según Com. “A” 1858, 4172,
4631 y 4652.
7.
7.4. “A” 4652 2.
8.1. “A” 2227 único 5.2.1. último Según Com. “A” 2649 y “A” 4172.
8.2. 1º “A” 2227 único 5.1.1. y
5.1.7.
Según Com. “A” 2649 y “A” 4172.
“A” 2227 único 5.2.2. Según Com. “A” 4172.
8.
8.2. último “A” 2461 único V. Según Com. “A” 4172.
9.1. “A” 3959 Según Com. “A” 4172.
9.2. “A” 3959 Según Com. “A” 4172.
9.3. “A” 3985 Según Com. “A” 4172.
9.4. “A” 3985 Según Com. “A” 4172.
9.5. “A” 3986 2. y 4. Según Com. “A” 4172 y “A” 4270.
9.6. “A” 3986 3. y 4. Según Com. “A” 4172.
9.
9.7. “A” 4238 2. Según Com. “A” 4368.
```

Section 2. Application of the loan capacity of foreign‑currency deposits

2.1. Destinations

The loan capacity of foreign‑currency deposits must be applied, in the corresponding funding currency, indiscriminately, to the following destinations:

2.1.1. Pre‑financing and financing of exports that are carried out directly or through agents, consignees or other intermediaries acting on behalf and order of the owner of the goods, subject to the rules on compliance with the obligation to receive and settle the corresponding collections.

2.1.2. Financing to producers, processors or gatherers of goods, provided they have firm sales contracts for the goods with an exporter, with price fixed in foreign currency and the goods are fungible commodities quoted in foreign currency that are normal and customary in local or foreign markets, widely disseminated and easily accessible to the public.

2.1.3. Financing to producers of goods to be exported, either in the same state or as an integral part of other goods, by third‑party purchasers, provided they have total guarantees or guarantees in foreign currency from those third parties.

2.1.4. Financing of investment projects, working capital and/or the acquisition of any type of goods, including temporary imports of inputs, that increase or are linked to the production of goods for export. Even when the revenues of exporting companies do not come entirely from their foreign sales, the financings may be attributed provided that the cash flow in foreign currency from their exports is sufficient to cover repayment. Operations in which financing is granted through participation in syndicated loans, whether with local or foreign entities, are included.

2.1.5. Financing to commercial‑portfolio clients of a commercial nature that receive the treatment of consumer or housing loans – according to the provisions established in the "Debtor Classification" rules – whose destination is the import of capital goods ("BK" according to the MERCOSUR Common Nomenclature listed in Annex I of Decree 690/02 and other complementary provisions), which increase the production of goods destined for the domestic market.

2.1.6. Debt securities or participation certificates in financial trusts – including other collection rights specifically recognized in the trust contract to be created under the framework of "World Bank Loan No. 1192/OC‑AR" – whose trust‑assigned assets are loans originated by financial entities under the conditions referred to in points 2.1.1 to 2.1.3.

2.1.7. Debt securities or participation certificates in financial trusts, issued in foreign currency and with a public offering authorized by the National Securities Commission, whose trust‑assigned assets are documents guaranteed by reciprocal guarantee societies registered in the Registry enabled at the Central Bank of the Argentine Republic, or by national and provincial funds constituted with the same purpose as those societies and admitted by this Institution, purchased by the trustee in order to finance operations under the terms and conditions referred to in points 2.1.1 to 2.1.3.

Version: 4a. COMMUNICATION “A” 4665
Effective date: 28/09/2006

Credit Policy
B.C.R.A.

2.1.8. Financing with destinations other than those mentioned in the preceding points, included in the credit program referred to in the Inter‑American Development Bank loan cited in point 2.1.6, without exceeding 10% of the loan capacity.

2.1.9. Inter‑financial loans.

Financial entities may attribute inter‑financial loans to these resources if they identify and report that circumstance to the borrowers.

2.2. Conditions

For the granting of such financings, regardless of the source of resources applied, financial entities must verify that clients have sufficient repayment capacity, which will be measured taking into account at least two scenarios in which significant exchange‑rate variations of different magnitudes are contemplated over a term of up to one year, and in both cases exceed the latest available estimate on the matter arising from the Market Expectations Survey ("REM") published by this Institution.

The financing agreed and the maturities established must be related to the projected cash‑flow in the currency of loan grant, except in the cases provided for in point 2.1.5.

2.3. Effectuation

Loans granted must be settled in the Single and Free Foreign Exchange Market.

2.4. Attribution of incorporated financings

Financings for the destinations established in point 2.1 may be attributed to the loan capacity of foreign‑currency deposits when transferred by other financial entities, provided the assignors have complied with the requirements set out in points 2.2 and 2.3.

2.5. Financings recorded in order‑account balances

Financings to debtors classified in the “unrecoverable” category and recorded in order‑account balances, according to the rules on “Minimum provisions for uncollectibility risk”, may not be attributed to the loan capacity of foreign‑currency deposits.

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Origin of the provisions included in the ordered text of the "Credit Policy" regulations

Text Ordered	Norm of Origin	Observations
1.1. “A” 49	OPRAC‑1	I 1.1.
1.2. “A” 4311		Includes concept according to points 6. and 7.5. of Comm. “A” 2736.
1.
1.3. “A” 49	OPRAC‑1	I 1.2.
2.1. “A” 3528		1. According to Comm. “A” 4147, Annex.
2.1.1. 1º “A” 3528	1.1. According to Comm. “A” 4015, 4311 and 4423.
2.1.2. “A” 4015	1.2. Includes interpretative clarification.
2.1.3. “A” 4015	1.3.
2.1.4. “A” 4423
2.1.5 “A” 4453	According to Comm. “A” 4577.
2.1.6. “A” 4011	1.4. 1st According to Comm. “A” 4015 and 4311.
2.1.7. “A” 4168	1. According to Comm. “A” 4465.
2.1.8. “A” 4015	1.4. last According to Comm. “A” 4311.
2.1.9. “A” 3528	1.2. According to Comm. “A” 4140 and 4311.
2.2. “A” 4015	1. 2nd According to Comm. “A” 4311, 4453 and 4577.
2.3. “A” 4015	1. 3rd
2.4. “A” 4311
2.5. “A” 4311
1st “A” 3528	1. 2nd According to Comm. “A” 4015 and 4147.
2.6. “A” 4159	2nd and last
	3.1. 5th and last
Section 3 of the informational regime on minimum cash and resource application	Includes interpretative clarification.
2.7. “A” 3528	1. 3rd According to Comm. “A” 4015, 4140 and 4549.
3. 3.1. “A” 4140 II	1. 2nd
3.2. “A” 4311	Includes concept according to points 6. and 7.5. of Comm. “A” 2736.
4. 4.1. “A” 4311
5.1. “A” 4311
5.2. “A” 4311	1st “A” 2736 6. Includes interpretative clarification.
5.
5.3. last “A” 4311
6. 6.1. “A” 4311
6.2. “A” 4311
7. 7.1. “A” 4549	5.

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Section 6. Classification of commercial‑portfolio debtors

6.1. Basic information

The review of the commercial portfolio will be carried out on the basis of updated financial information – accounting statements and complementary information, investment projects, etc. – that clients must provide upon request of the entities, applying parameters valid for each sector and considering other circumstances of the economic activity.

6.2. Classification criterion

The basic evaluation criterion is the debtor’s repayment capacity based on the estimated cash flow and, only secondarily, on the liquidation of the client’s assets, since the granting of financings must respond to their real credit needs and be made under amortization conditions that match the real repayment possibilities allowed by their activity and fund generation.

In that analysis, emphasis will be placed on measuring the degree of exposure recorded in foreign currency based on the debtor’s foreign‑currency indebtedness and income generation in that currency, as well as on those incomes and outflows linked to the evolution of the Reference Stabilization Coefficient.

Regarding clients with foreign‑currency financings, regardless of the source of resources applied, emphasis must be placed on analyzing whether the client has sufficient repayment capacity to cover maturities even under significant exchange‑rate variations. For this purpose, at least two scenarios must be considered in which significant exchange‑rate variations of different magnitudes over a term of up to one year are contemplated, and in both cases exceed the latest available estimate on the matter arising from the Market Expectations Survey ("REM") published by this Institution at the time of the evaluation.

In the case of financial entities, the analysis must also take into account the liquidity of the debtor intermediary and the quality of its portfolio.

6.3. Minimum classification frequency

The review must be carried out at least with the frequency indicated below, leaving a record of it in the file of the analyzed client:

6.3.1. Quarterly

During each calendar quarter, for individually considered clients whose financings at any time amount to 5 % or more of the computable equity responsibility or of the financial‑trust asset of the previous month, depending on whether the subject is an entity or a financial trust, respectively. For these purposes, the economic group or conglomerate will be treated as a single client.

6.3.2. Semi‑annually

During each calendar semester, for individually considered clients whose financings at any time sum to between 1 % and 5 % of the computable equity responsibility or of the financial‑trust asset of the previous month (or the lesser of that amount and ARS 1,000,000), depending on whether the subject is an entity or a financial trust, respectively. For these purposes, the economic group or conglomerate will be treated as a single client.

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Credit Policy
B.C.R.A.

Section 2. Application of the loan capacity of foreign‑currency deposits.

Version: 6a. COMMUNICATION “A” 4665
Effective date: 28/09/2006