Minimum Capital Requirements for Financial Entities, Debtor Classification, Result Distribution, Non-Financial Public Sector Financing, Credit Risk Segmentation, Net Global Foreign Currency Position, Adjustments

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2017 – YEAR OF RENEWABLE ENERGIES

COMMUNICATION “A” 6396 11/12/2017

TO FINANCIAL ENTITIES:

Reference: Circular
LISOL 1 – 768
CONAU 1 – 1251
OPRAC 1 – 924

Minimum capital of financial entities. Classification of debtors. Distribution of results. Financing to the non‑financial public sector. Credit‑risk segmentation. Net global foreign‑currency position. Adjustments.

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We address you to inform that this Institution has adopted the following resolution:

1. Incorporate as point 8.2.1.7 of the rules on “Minimum capital of financial entities” the following:

   8.2.1.7. Other comprehensive income. i) 100 % of the results recorded in the following items:

   • Revaluation of property, plant and equipment and intangibles.
   • Gains or losses on financial instruments at fair value with changes in other comprehensive income.
     ii) 100 % of the debtor balance of each of the items recorded in other comprehensive income not mentioned in sub‑paragraph i). The recognition of these concepts – recorded in other comprehensive income accounts or accumulated other comprehensive income accounts, as appropriate – shall be carried out in accordance with the terms of points 8.2.1.5 or 8.2.1.6, as the case may be.

2. Incorporate as point 2.1.6 in the rules on “Classification of debtors” the following:

   2.1.6. Negotiable obligations – including subordinated ones – and debt securities of financial trusts, valued at amortised cost and/or at fair value with changes in other comprehensive income.

3. Substitute the title of point 2.2.1 of the rules on “Classification of debtors” with the following:

   2.2.1. The following concepts by financial intermediation:

4. Incorporate as point 2.2 of the rules on “Distribution of results” the following:

   2.2. The result arising from the revaluation of property, plant, equipment and intangibles and of investment properties.

5. Incorporate as point 3.1.10 of the rules on “Financing to the non‑financial public sector” the following:

   3.1.10. Liabilities in favour of the entity for financial‑intermediation operations – such as acceptances, passes and forward‑sale operations.

6. Incorporate as point 3.1.12 of the rules on “Credit‑risk segmentation” the following:

   3.1.12. Liabilities in favour of the entity for financial‑intermediation operations – such as acceptances, passes and forward‑sale operations.

7. Substitute the first and second paragraphs of point 1.1 of the rules on “Net global foreign‑currency position” with the following:

   In the net global foreign‑currency position, the totality of assets, liabilities, commitments and other instruments and operations by financial intermediation in foreign currency or linked to exchange‑rate movements shall be considered, including spot, forward and other derivative contracts, foreign‑currency deposits in accounts opened at the Central Bank of the Argentine Republic (BCRA), the gold position, BCRA monetary‑regulation instruments in foreign currency, subordinated debt in foreign currency and representative debt instruments in foreign currency. Forward contracts concluded within a framework agreement in markets authorized by the National Securities Commission (CNV) and settled by cash without delivery of the underlying asset shall also be counted.

8. Provide that the present provisions shall be effective from 01‑01‑18.

Finally, we inform you that we will subsequently send the sheets that, in replacement of those previously provided, must be incorporated into the respective regulations.

Respectfully,

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA

Darío C. Stefanelli Agustín Torcassi

Senior Manager of Issuance and Regulatory Applications Deputy General Manager of Regulations

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