Notice No. 06/2018 of August 2, 2018

Published in the Official Gazette of the Republic, First Series, No. 122 of August 15, 2018 NOTICE NO. 06/2018 Of August 2, 2018 SUBJECT: FOREIGN EXCHANGE POLICY

• Foreign Exchange Position Limit
  Given the need to update the regulation on the foreign exchange position limit of Commercial Banks; Considering the relevance of establishing the operating rules for the foreign exchange position limit, in order to regulate the relationship between the National Bank of Angola, in exercising its functions as manager of external reserves, and Commercial Banks authorized to conduct foreign exchange trading. Under these terms, and pursuant to the combined provisions of letters d) and f) of paragraph 1 of Article 21, and letter d) of paragraph 1 of Article 51, both of Law No. 16/10 of July 15 – National Bank of Angola Law, letter l) of paragraph 1 of Article 90 of Law No. 12/15 of June 17, Framework Law of Financial Institutions, and Article 12 of Law No. 5/97 of June 27 – Foreign Exchange Law, I DETERMINE:
  Article 1.
  (Subject Matter)
  This Notice establishes the global foreign exchange position limit for Commercial Banks and its calculation basis.

CONTINUATION OF NOTICE NO. 06/2018 Page 2 of 4
ARTICLE 2.
(Scope)
This Notice applies to Commercial Banks, hereinafter abbreviated as Banks.
ARTICLE 3.
(Definitions)
1. For the purposes of this Notice, it is understood that:
1.1 Net foreign exchange position in each currency: results from the algebraic sum of the following elements, positive or negative:
a) Net spot position: the difference between assets and liabilities, in each currency; b) Net forward position: the difference between resources to be received and paid regarding foreign exchange forward operations;
1.2 Global foreign exchange position: the algebraic sum of net foreign exchange positions held in various foreign currencies, converted into Euros (EUR), which may be long or short.
2. For the purposes of this article, the elements contained in the daily foreign exchange position statement shall be considered, as established in specific regulations.
Article 4.
(Limit for Foreign Exchange Position)
1. Banks must maintain, on a daily basis, a global foreign exchange position that does not exceed 10% (ten percent) of their Regulated Own Funds (ROF), regardless of whether the position is long or short.
2. For compliance with the preceding paragraph, ROF calculated at the close of the previous month shall be considered.

CONTINUATION OF NOTICE NO. 06/2018 Page 3 of 4
3. Banks must sell any excess foreign exchange position in the interbank foreign exchange market or to the National Bank of Angola immediately after submitting the report, at a freely negotiated rate between the parties.
Article 5.
(Calculation Basis)
Foreign currency assets and liabilities shall be considered at their gross accounting value.
Article 6.
(Conversion)
1. The foreign exchange position shall be calculated in EUR.
2. For the purposes of the preceding paragraph, when converting foreign exchange positions in different currencies to EUR, the reference average exchange rate in force on the date to which they relate shall be applied.
3. The rate referred to in paragraph 2 shall also be applied when converting ROF from Kwanzas to EUR.
ARTICLE 7.
(Information Elements)
1. The daily closing foreign exchange operations statement shall be submitted to the National Bank of Angola, in accordance with specific regulations.
2. Banks must maintain dedicated records of supporting documentation for their respective daily foreign exchange positions, in accordance with prevailing legislation.
3. The National Bank of Angola may establish complementary guidelines to this Notice, as well as request additional information it deems necessary for fulfilling its mission.

CONTINUATION OF NOTICE NO. 06/2018 Page 4 of 4
Article 8.
(Penalties)
Non-compliance with this Notice constitutes an offense provided for and punishable under Law No. 12/15 of June 17, Framework Law of Financial Institutions.
Article 9.
(Doubts and Omissions)
Doubts and omissions arising from the interpretation and application of this Notice shall be resolved by the National Bank of Angola.
Article 10.
(Repealing Provision)
Notice No. 01/2018 of January 22, on Foreign Exchange Position Limit, and all legislation contrary to this Notice are hereby repealed.
Article 11.
(Entry into Force)
This Notice enters into force on the date of its publication.
PUBLISHED.
Luanda, August 2, 2018.
THE GOVERNOR
JOSÉ DE LIMA MASSANO