Norm Amending Article 6 of the Capital Adequacy Standard

Page 1 of 2 Resolution No. CD-SIBOIF-1031-2-DIC4-2017 Dated December 4, 2017

NORM AMENDING ARTICLE 6 OF THE CAPITAL ADEQUACY STANDARD

The Board of Directors of the Superintendence of Banks and Other Financial Institutions, after deliberations on the matter,

CONSIDERING

I That on October 27, 2010, the Capital Adequacy Standard was approved, contained in Resolution No. CD-SIBOIF-651-1-OCTU27-2010, published in La Gaceta, Official Journal No. 18, on January 28, 2011.

II That it is necessary to amend Article 6 of the aforementioned standard in order to align it with the provisions contained in Law No. 965, "Law Amending Law No. 677, Special Law for the Promotion of the Construction of Housing and Access to Social Interest Housing," published in La Gaceta, Official Journal No. 207, on October 31, 2017; particularly with respect to adjusting the reference amount of mortgage credits for social interest housing, in accordance with the amounts established in the aforementioned Law No. 965, depending on whether the housing is "single-family" or "multi-family," for the purpose of applying a lower weighting percentage than the standard requires for other housing credits that do not fall within the definitions and amounts specified by said Law for these types of housing.

III That in accordance with the considerations set forth above and based on the authority granted by Article 3, items 3) and 13), and Article 10, item 1), of Law 316, Law of the Superintendence of Banks and Other Financial Institutions, and its amendments.

In exercise of its powers,

HAS ISSUED

The following:

Resolution No. CD-SIBOIF-1031-2-DIC4-2017 NORM AMENDING ARTICLE 6 OF THE CAPITAL ADEQUACY STANDARD

FIRST: Amend item "E" of Article 6 of the Capital Adequacy Standard, contained in Resolution No. CD-SIBOIF-651-1-OCTU27-2010, of October 27, 2010, published in La Gaceta, Official Journal No. 18, on January 28, 2011, which shall read as follows:

"Art. 6 Risk-weighted credit assets.- Risk assets shall be weighted as follows: ...

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E) With a weighting of sixty to one hundred twenty-five percent (60% to 125%) of their value, the following credit operations, exposed to credit exchange rate risk:

1. Consumer credits granted in foreign currency and in national currency with value maintenance shall be weighted at one hundred twenty-five percent (125%) of their value.
2. Mortgage credits for housing granted in foreign currency and in national currency with value maintenance shall be weighted at sixty percent (60%) of their value. Credits for social interest housing, single-family and multi-family, referred to in Law No. 677, Special Law for the Promotion of the Construction of Housing and Access to Social Interest Housing, published in La Gaceta, Official Journal No. 80, on May 4, 2009, and its amendments, granted in foreign currency and in national currency with value maintenance for amounts that do not exceed the values established in the aforementioned Law No. 677 for the types of housing mentioned above, shall be weighted at fifty percent (50%) of their value.
3. Commercial credits and microcredits granted in foreign currency and in national currency with value maintenance to debtors who do not generate foreign exchange shall be weighted at one hundred twenty-five percent (125%) of their value; otherwise, they shall be weighted at one hundred percent (100%). For the purposes of this standard, those are considered foreign exchange generators whose source of income comes from: i. Financing operations for goods or merchandise for export in which there is a purchase and sale contract between the trading entity and the producer, and in which the corresponding payment is established in foreign currency or national currency with value maintenance; ii. Export operations of services or provision of services to exporters, in which there is an export contract or service provision contract, and in which the corresponding payment is established in foreign currency. The above cases must be duly evidenced by the institution. The purchase of foreign exchange in the exchange market or the mere fact that the prices of the goods or services it trades are expressed in foreign currency shall not be considered as the debtor being a foreign exchange generator. ..."

SECOND: This standard shall enter into force upon its notification, without prejudice to its subsequent publication in La Gaceta, Official Journal. . (f) S. Rosales (f) M. Díaz O. (f) Gabriel Pasos Lacayo (f) Fausto Reyes (f) illegible (Silvio Moisés Casco Marenco) (f) illegible (Freddy José Blandón Argeñal) (f) U. Cerna. Secretary. URIEL CERNA BARQUERO Secretary of the Board of Directors SIBOIF