Norm on Updating Shareholder Information of Financial Institutions

NORM ON UPDATING SHAREHOLDER INFORMATION OF FINANCIAL INSTITUTIONS Resolution No. CD-SIBOIF-461-1-ENE16-2007 The Board of Directors of the Superintendence of Banks and Other Financial Institutions, CONSIDERS I That Article 129 of Law 561, General Law of Banks, Non-Banking Financial Institutions and Financial Groups, establishes that the board of directors of financial institutions must establish procedures and delegate corresponding responsibilities to ensure that shareholders holding 5% or more of the capital are required to provide the necessary data to keep the information established in Article 4 of said Law updated, as applicable; II That, as indicated in the aforementioned Article 129, the Board of Directors of the Superintendence is empowered to issue general application rules indicating the deadlines, information, and documents that must be presented to prove compliance with what is stated in said article; III That numeral 13 of Article 38 of the General Law of Banks establishes that the boards of directors of financial institutions must ensure that resolutions issued by the Board of Directors of the Superintendence and provisions of the Superintendent are complied with without delay, as well as information requests made by the latter; In exercise of its powers, HAS ISSUED The following:

NORM ON UPDATING SHAREHOLDER INFORMATION OF FINANCIAL INSTITUTIONS Resolution No. CD-SIBOIF-461-1-ENE16-2007
CHAPTER I
CONCEPTS, OBJECT AND SCOPE
Art. 1. Concepts.- For the purposes of this norm, the following are understood:
a. 5% Shareholder(s): Natural or legal person who, individually or jointly with their related parties, participates in the social capital of a supervised financial institution in a percentage equal to or greater than 5% of its social capital in accordance with the calculation method established in this norm. b. Institution(s) or financial institution: Banks, non-banking financial institutions, and special regime financial companies subject to the supervision of the Superintendence.
c. General Law of Banks: Law 561, General Law of Banks, Non-Banking Financial Institutions and Financial Groups.
d. Law of the Superintendence and its reforms: Law 316, Law of the Superintendence of Banks and Other Financial Institutions, reformed by Law 552, Law of Reforms to Law 316, Law of the Superintendence of Banks and Other Financial Institutions, and by Law 564. e. Superintendence: Superintendence of Banks and Other Financial Institutions. Art. 2. Object.- This norm aims to establish the information requirements, documentation, deadlines, and other formal aspects that the boards of directors of financial institutions must comply with to update information on 5% Shareholders for the purpose of determining their solvency and integrity, in accordance with what is established by numeral 6 of Article 4 of the General Law of Banks, as required by Article 129 of that same legal framework. Art. 3. Scope.- This norm is applicable to all financial institutions supervised by the Superintendence, including special regime financial companies referred to in Article 147 of the General Law of Banks. Art. 4. Exceptions.- The Superintendent may authorize exceptions to one, several, or all of the information requirements established in Article 6 of this norm in the following cases:

a. When the legal entity partner is a public law institution. b. When the legal entity partner is a bank or international or multilateral development organization, internationally recognized as such.
c. When the legal entity partner is an institution directly supervised by the Superintendence.
d. When the legal entity partner is a foreign financial institution subject to supervision according to international practices. e. When the legal entity partner trades its shares on a stock exchange or regulated market. When pertinent, supporting documents for the case must be presented.
CHAPTER II
INFORMATION REQUIREMENTS
Art. 5. Solvency, integrity and identification of 5% shareholders.- The board of directors must obtain the following information from 5% Shareholders:
a. When they are natural persons:
1. Name, age, occupation, nationality, and domicile.
2. Curriculum vitae documented with the information required in Annex 1, which becomes an integral part of this norm.
3. Patrimonial statements and relationship of income and expenses, with the information required in Annex 2, which becomes an integral part of this norm, signed by the interested party. Figures must be expressed in book value in accordance with accounting standards. In cases where the Superintendent requires it, these must be duly certified by a public accountant or equivalent professional in the country where they were issued.
4. Photocopy of the identity card on both sides for nationals, or of the residence card for residents or of the passport in the case of foreigners, notarized by a public notary in accordance with the law on the matter.

5. Number of the Single Taxpayer Registry (RUC). In the case of foreigners not domiciled in the country, they must present the equivalent used in the country where they pay taxes.
6. Declaration before a public notary stating that they are not subject to any of the situations contemplated in numerals 1, 5, 6, 7, and 8 of Article 29 of the General Law of Banks, in accordance with Annex 3, which becomes an integral part of this norm.
b. When they are legal entities:
1. List and percentage of participation of 5% Shareholder natural persons, ultimate owners of the shares in a chain of legal entities. In order to determine if the natural persons indicated here are 5% Shareholders, the calculation methodology established in the following article must be followed.
The natural persons who, according to the aforementioned calculation methodology, are 5% Shareholders must comply with the information requirements established in letter a. of this article. The Superintendent is empowered to request the information he deems necessary regarding the legal entities in which 5% Shareholder natural persons participate, such as members of boards of directors, activity to which they are dedicated, constitution and registration data, among others.
c. Organizational chart presenting the shareholding structure of 5% Shareholders, reflecting whether this percentage of participation is individual or joint with their related parties, indicating the full names of the natural or legal persons contained in this organizational chart.
Art. 6. Calculation methodology to determine if one is a 5% shareholder.- The 5% ownership of a natural person individually or jointly with their related parties through one or several legal entities until reaching the institution is determined as follows:
PN1 ----------> PJ2 ----------> PJS ---------- PJ(n-1)% ----------> PJ(n) P1% P2% P(n-1)% Where K% is the percentage of participation of PN1 in PJ(n) Conditions:
1. If P1% ≤ 50%:
K% = P1% * P2% * ----- * P(n-1)%
2. If P1% > 50%, P1% is considered 100%:
a) Where P2% ≤ 50%:
K% = 100% * P2% * ----- * P(n-1)% and so on. b) Where P2% > 50%:
K% = 100% * 100% * P3% * ----- * P(n-1)% and so on.
Abbreviations:
PN: Natural Person
PJ: Legal Entity
Pi%: Percentage of participation of natural person “i” in the capital of legal entity “i+1”. For i = 1, 2, 3, …., n-1.
CHAPTER III
INFORMATION MANAGEMENT
Art.7. Collection.- The information and documentation required regarding 5% Shareholders must be collected and kept under the custody of the board of directors, which must establish the necessary mechanisms to keep this information updated so that they can follow up on changes in the situation of their 5% Shareholders. The Superintendent will verify compliance with the provisions contained in this norm through requests for the documentation and information required by it and/or through on-site inspections. Art. 8. Communication of significant changes.- Without prejudice to what is indicated in the previous article, the board of directors must communicate to the Superintendent whenever there are significant changes that negatively affect the reputation and/or patrimony of the 5% Shareholder. Significant changes that negatively affect the reputation of the 5% Shareholder are understood to be those cases where he participates or is involved, either actively or passively, in judicial or administrative proceedings. Significant changes that negatively affect the patrimonial situation of the 5% Shareholder are understood to be those cases where his patrimony is reduced by 15%, or, without such reduction having occurred, the main business activity is affected or could be affected by intrinsic situations or exogenous situations.

CHAPTER IV
FINAL PROVISIONS
Art. 9. Initial collection.- The initial collection of information referred to in Article 7 above must be complete within a period of 3 months from the entry into force of this norm. Art. 10. Modification of annexes.- The Superintendent is authorized to modify the annexes contained in this norm when the case so requires. Art. 11. Related parties.- Information regarding related parties must be presented in accordance with the criteria established in the General Law of Banks and the norm on the matter. Art. 12. Legalization of documents from abroad and their language.- All information and/or documentation required by this norm that is in a language other than Spanish must be available with its corresponding translation, which must comply with what is stipulated in national laws on the matter or with the laws of the country where the translation is effected. Documents from abroad that are required of natural or legal persons in this norm must comply with the requirements established by the laws on the matter so that they can have legal effects in the country. Art. 13. Repeal.- The Norm on Updating Shareholder Information of Financial Institutions contained in Resolution No. CD-SIBOIF-442-2-SEP12-2006 dated September 12, 2006, is repealed. Art 14. Validity.- This norm shall enter into force upon its publication in La Gaceta, Official Diary.

ANNEX 1
CURRICULUM VITAE OF SHAREHOLDERS
Strictly confidential information
INSTITUTION:
_______________________________________________________________ GENERAL DATA Full name:
_______________________________________________________________ Nationality:
_______________________________________________________________ Profession or trade:
_______________________________________________________________ Place and date of birth:
_______________________________________________________________ Identity Card Number (nationals):
_______________________________________________________________ Residence Card (in the case of foreigners residing in the country):
_______________________________________________________________ Passport number in case of being foreign:
_______________________________________________________________ RUC No. (or its equivalent, as appropriate):
_______________________________________________________________ Position held in the institution:
_______________________________________________________________ Migration status:
_______________________________________________________________ Do you have authorization to work in Nicaragua? (only for foreign shareholders holding administrative positions) YES ( ) NO ( ) Authorization number:

---

Date of authorization:
_______________________________________________________________ Validity of authorization:
_______________________________________________________________ KNOWLEDGE AND EXPERIENCE Knowledge and experience in banking, stock market, financial activities, and financial risk management:
Entity Position Period from ... to...
Main Functions

Positions held or currently held in other entities:
Entity Position Period from ... to...
Main Functions

Studies and training completed:
Establishment Title or course name Period from ... to... Observations

OTHER INFORMATION
Have you been declared bankrupt? YES ( ) NO( ) If affirmative, indicate the reasons and state if you have been rehabilitated:
_____________________________________________________________ Have you ever been subject to judicial proceedings? YES ( ) NO ( ) If affirmative, indicate:
Reason Type of process Date Final Result

Have you been administratively sanctioned or judicially prosecuted for money laundering or other assets? YES ( ) NO ( ) If affirmative, indicate the sanction or process. I declare that the data above are true, submitting myself to the sanctions determined by law for any inaccuracies thereof. Place and date: ___________________________________________________ f) __________________ Name: ______________

ANNEX 2
PATRIMONIAL STATEMENT AND RELATIONSHIP OF INCOME AND EXPENSES OF SHAREHOLDERS (Strictly confidential information) INSTITUTION:___________________________________ __________________ NAME:_______________________________________________________ Referred to day _______________________________________________________________ ASSETS (In thousands of C$)* Cash in hand Bank deposits (total) Account of ______________ No. ____________ Bank ___________ Account of ______________ No. ____________ Bank ___________ Account of ______________ No. ____________ Bank ___________ Account of ______________ No. ____________ Bank ___________ Shares (detail in table 3) Bonds, promissory notes, and other securities (detail in table 3) Accounts receivable (only those duly documented, Detail in table 4) Inventories (cost value, detail in table 5) Household goods Machinery, furniture, and equipment Tools Vehicles (detail in table 6 ) Real estate (detail in table 7) Other assets (specify)

TOTAL ASSETS

LIABILITIES
(In thousands of C$)*
Short-term credits (one year or less, include overdrafts, detail in table 9) Long-term credits (more than one year, detail in table 9) Accounts payable Suppliers Other liabilities (specify)

TOTAL LIABILITIES

NET EQUITY (Assets minus liabilities) __________________________ CONTINGENCIES (detail in table 10) _________________________

• When dealing with foreign currency, indicate its equivalent in national currency, at the official exchange rate on the date of the patrimonial statement.
• Figures must be presented at book value in accordance with the accounting standard.
  INCOME (1)
  (Figures in thousands of C$)
  CONCEPTS MONTHLY ANNUAL
  Salaries
  Dividends and interest
  Commissions
  Rentals

Others (specify)

TOTAL INCOME

EXPENSES (2)
(Figures in thousands of C$)
CONCEPTS MONTHLY ANNUAL
Personal expenses
Loan amortization
Interest on loans
Other expenses (specify)

TOTAL EXPENSES

INVESTMENTS IN SECURITIES (3)
ENTITY
ISSUER
TYPE OF INVESTMENT
(shares, bonds, promissory notes, etc.)
COST VALUE SHAREHOLDING PARTICIPATION PERCENTAGE (%) BOOK VALUE

ACCOUNTS RECEIVABLE (4)
TYPE OF DOCUMENT
(Promissory notes, bills of exchange, etc.) ORIGINAL AMOUNT CURRENT BALANCE

INVENTORIES (5)
DESCRIPTION OF INVENTORY QUANTITY IN STOCK BOOK VALUE

VEHICLE DETAIL (6)
BRAND YEAR ACQUISITION VALUE BOOK VALUE

REAL ESTATE DETAIL (7)
DESCRIPTION OF REAL ESTATE HOUSE, FARM, LAND, BUILDING ADDRESS BOOK VALUE AREA MTS2. REGISTRATION NO. VOLUME, PAGE AND ENTRY BOOK No. OF THE DEPT. OF

DETAIL OF ENCUMBRANCES ON THE ABOVE IDENTIFIED REAL ESTATE (8) NAME OF CREDITOR DATA OF REAL ESTATE BALANCE DUE DATE

BANKING OBLIGATIONS
SHORT AND LONG TERM (9)
BANK AND COUNTRY CREDIT NO. BALANCE TYPE OF GUARANTEE GRANT DATE MATURITY DATE

CONTINGENT OBLIGATIONS (10)
GUARANTOR, CO-DEBTOR OR SURETY NAME OF CREDITOR ORIGINAL AMOUNT BALANCE

INSURANCES CONTRACTED (11)
INSURANCE COMPANY POLICY NO. TYPE OF INSURANCE INSURED AMOUNT VALIDITY DATE

Note: Any other additional information or documentation deemed convenient may be added.
OBSERVATIONS:
_______________________________________________________________ _______________________________________________________________ I DECLARE that the above information is true and I submit myself to the corresponding legal sanctions for any falsehood or inaccuracy that may be proven. Place and date______________________________________________________ (f) ___________________________________________ Name_______________________________________

ANNEX 3
DECLARATION FOR SHAREHOLDERS
Mr. Superintendent of Banks and Other Financial Institutions Present.
I, , of years of age, profession or trade_____________, nationality_________________, domicile of_________________ , with Identity Card No. declare that:
a. I am not in a situation of bankruptcy or insolvency and have never been judicially qualified as responsible for fraudulent or negligent bankruptcy. b. I am not a delinquent debtor of credits in the financial system.
c. In order to verify compliance with what is indicated by No. 5 of Article 29 of the General Law of Banks, I also declare that I am a shareholder of the entities detailed below:
d. I have never been sanctioned for causing patrimonial damage to a bank or to public faith by altering its financial statements, during the last 15 years. e. I have never participated as a director, manager, deputy manager, or official of equivalent rank of an institution that has been subjected to intervention processes and declaration of forced liquidation status; or that by judicial or administrative resolution, responsibilities, presumptions, or indications linking me to the aforementioned situations have been established against me. f. I have never been convicted of intentional crimes that had penalties greater than corrective ones. Struck out.- Alfredo Cuadra Garcia. Invalid. Crossed out. Gabriel Pasos Lacayo. Valid. (f) María Acevedo (f) Antenor Rosales B. (f) Victor Urcuyo (V) (f) Roberto Solórzano Ch. (f) A. Cuadra G (f) Gabriel Pasos Lacayo (f) U. Cerna B. URIEL CERNA BARQUERO Secretary of the Board of Directors SIBOIF