Notice No. 09/2022 of April 6

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PUBLISHED IN THE OFFICIAL GAZETTE, FIRST SERIES, NO. 60, OF APRIL 6, 2022 NOTICE NO. 09/2022 SUBJECT: FINANCIAL SYSTEM

• Housing Credit

Considering the relevance of promoting the construction of residential properties and creating conditions for bank customers to enter into housing credit agreements compatible with their average income levels; It is important, while market interest rates do not converge to levels that make long-term credit accessible, to create conditions for the development and promotion of housing credit for the acquisition of residential properties, as well as to reinforce the role of the interest rate as a channel for monetary policy transmission, in a context of low penetration of medium and long-term credit in the national market; In this context, the National Bank of Angola sought to establish an interest rate for housing credit and credit for the construction of residential projects, which anticipates expected market interest rate levels in a context of inflation closer to its target; In order to compensate Commercial Banks for the subsidy inherent in the interest rate offered to their customers, the National Bank of Angola allows the financed amounts to be deducted from mandatory reserves, thus enabling the profitability of these funds; The granting of credit by Commercial Banks under the terms established by the National Bank of Angola is always subject to the financial capacity of the credit applicant to fulfill its obligations under the financing contract, as well as compliance with other conditions normally applicable to credits of the respective nature.

CONTINUATION OF NOTICE NO. 09/2022 Page 2 of 9 Under the combined provisions of Article 26 of Law No. 14/21, of May 19 - General Regime Law for Financial Institutions, and Articles 30 and 54 of Law No. 24/21, of October 18 - National Bank of Angola Law. I DETERMINE:

Chapter I

General Provisions

Article 1.

(Object Matter)
This Notice establishes special regimes for housing credit and construction credit, and defines the eligibility requirements, terms, conditions, and costs applicable to these credits, as well as their treatment in the calculation of mandatory reserves.

Article 2.

(Scope)

1. The provisions of this Notice are mandatory for Systemically Important Banking Financial Institutions in the national market, and optional for other Banking Financial Institutions.
2. The mandatory application applies to the granting of credit that meets the eligibility criteria established in this Notice for clients with credit risk consistent with the risk appetite of each Banking Financial Institution.
3. The Banking Financial Institutions, hereinafter referred to as Commercial Banks, may additionally offer other housing credit and construction credit products for residential projects to serve their clients who, not meeting the requirements of this Notice, fall within their risk appetite and target market.

Article 3.

(Credit Risk Assessment and Management)

1. Commercial Banks must comply with the following regulations:
   a) Notice No. 14/2016, of September 07, regarding information duties within the scope of credit contracts; b) Instruction No. 4/2019, of April 26, regarding the granting of credit, insofar as it does not contradict the provisions of this Notice; c) Instruction No. 7/2020, of April 20, regarding analysis periods, communication of final decisions, formalization, and disbursement of credit.
2. Commercial Banks must ensure:
   a) Prior to granting credit under this Notice, as applicable:
   i) A rigorous assessment of clients' financial capacity to fulfill their obligations under the proposed housing credit contract; ii) An assessment of the residential construction project promoter's capacity to fulfill its obligations under the said project and credit contract. b) During the credit term, regular monitoring of their clients to timely detect financial difficulties or other circumstances that may increase default risk, and to take appropriate measures to prevent or resolve the situation.
3. For the purpose of preparing financial plans for housing credit, under Notice No. 14/2016, of September 07, and in particular for calculating the Annual Percentage Rate of Charge (APRC), Commercial Banks must base themselves on the assumption that, at the end of the fixed nominal rate period, the subsequent variable nominal rate shall be assumed to be 7% (seven percent) per annum.

Article 4.

(Cost of Credit)

1. The interest rates and fees established in this article correspond to global maximums, and Commercial Banks may apply lower rates and fees, considering their assessment of the credit risk associated with each client as well as their commercial strategy.
2. Fees charged at the time of credit granting cannot exceed 1% (one percent) of the total credit amount to be granted.
3. During the credit term, no other fees may be charged, except in the case of credit restructuring or extension of its term, with these limited to 0.5% (half percent) each.
4. Fees for early repayment, partial or total, of the credit cannot be charged.
5. Rates and fees regarding notarial and registration acts in the granting of credit, insurance policy costs, as well as any taxes payable on the credit, fees, and interest, are added to the fees charged under this Notice and are paid by the borrower.
6. The maximum applicable nominal interest rate for housing credit is as follows:
   a) For the first 10 (ten) years of this Notice's validity, it is 7% (seven percent) per annum; b) From June 01, 2032, it shall be the interbank reference rate for a 30 (thirty) day term, possibly increased by a margin, provided that the total annual interest rate does not exceed 7% (seven percent) per annum.
7. The maximum applicable nominal interest rate for construction credit is as follows:
   a) For the first 5 (five) years of this Notice's validity, it is 10% (ten percent) per annum; b) From June 01, 2027, it shall be a variable interest rate, indexed to the interbank reference rate for a 30 (thirty) day term, increased by a margin that must not exceed 1% (one percent).

Article 5.

(Public Disclosure of Availability of This Regime) Systemically Important Commercial Banks and others wishing to offer credit to their clients under this Notice must, after its entry into force, clearly disclose on their official website the availability of the credit modalities covered by this Notice, as well as the access requirements.

CONTINUATION OF NOTICE NO. 09/2022 Page 5 of 9

Chapter II

Housing Credit

Article 6.

(Eligibility Criteria)

1. The maximum financeable amounts under this Notice are determined by the financial capacity of borrowers and guarantors, and are subject to the following absolute limits:
   a) Kz 100,000,000.00 (one hundred million Kwanzas) when there are 2 borrowers or 1 borrower with 1 guarantor; b) Kz 50,000,000.00 (fifty million Kwanzas) when there is only 1 borrower.
2. The special housing credit regime established in this Notice covers the following credits:
   a) Granted after the entry into force of this Notice; b) For the acquisition of primary residence; c) For properties built after 2012 and acquired from a residential project promoter; d) Restructured after the entry into force of this Notice, for proven financial difficulties of the client to meet their obligations, provided that the remaining value at the time of restructuring is equal to or less than the value referred to in paragraph 1 of this article and the requirement in sub-paragraph b) of this paragraph is met.
3. The granting of a housing credit for the acquisition of a property that meets the conditions established in paragraphs 1 and 2 of this article, which is still under construction (off-plan), is permitted.
4. New properties held by Commercial Banks that are part of a residential project and were received as payment or fulfillment of a construction credit, with sale values equal to or less than those established in paragraph 1 of this article, may be sold to their clients and financed under this Notice, provided all its requirements are met.
5. The special housing credit regime established in this Notice does not cover credit granted:
   a) Under a housing credit regime intended exclusively for employees of the Commercial Bank itself; b) To a client, borrower of another active housing credit, regardless of whether that credit was granted by another commercial bank or secured by another property.
6. Any credit resulting from a restructuring under sub-paragraph d) of paragraph 2 of this article cannot exceed the outstanding debt value on the date of its restructuring.

Article 7.

(Terms and Conditions Applicable to Credits)

1. The maximum term for credit granted under this Notice is 25 (twenty-five) years, and Commercial Banks must also ensure that in the restructuring of a credit, the total term does not exceed 30 (thirty) years, as established in Presidential Decree No. 259/11, of September 30, Regulation on Housing Credit.
2. The ratio between the amount of credit granted under this Notice and the lower of the acquisition price or the property valuation given as collateral for the credit at the time of granting cannot exceed 100% (one hundred percent).
3. Commercial Banks must evaluate the best option for the client between progressive installments and constant installments, taking into account their characteristics, including the potential increase in their income during the credit term.
4. Regardless of the property value, the credit granted under this Notice must be the only credit secured by that property, and the contracting of other bank credits for its financing is not permitted under any circumstances, even under terms and conditions different from those set out in this Notice, and/or contracted at other Commercial Banks.

CONTINUATION OF NOTICE NO. 09/2022 Page 7 of 9

Chapter III

Construction Credit

Article 8.

(Eligibility Criteria)

1. Eligible for financing under this Notice are promoters of residential construction projects, with a maximum sale value per unit of Kz 100,000,000.00 (one hundred million Kwanzas), and Commercial Banks must prioritize projects that include units of various types and sale values, provided they are below the maximum value.
2. The promoters of the projects referred to in the preceding paragraph must meet the following requirements:
   a) Be a company constituted under the Commercial Companies Law or the Single-Member Companies Law; b) Have organized accounting and accounts certified by an accountant or certified accountant registered with the Angolan Order of Accountants and Certified Accountants; c) Have regular tax status; d) Have proven experience in executing construction projects of a nature similar to those covered by this Notice.
3. Financing for the acquisition of land is excluded from the scope of this Notice, regardless of whether these are associated with construction projects covered by the Notice.

Article 9.

(Terms and Conditions Applicable to Credits)

1. Construction projects financed under this Notice must be sized to allow completion of construction within a period not exceeding 3 (three) years.
2. The term referred to in the preceding paragraph corresponds to the maximum term for credit to be granted under this Notice, and the term for each construction project must be determined by its characteristics.

CONTINUATION OF NOTICE NO. 09/2022 Page 8 of 9

Chapter IV

Mandatory Reserves

Article 10.

(Deduction from Mandatory Reserves)

1. Deductible from the mandatory reserves to be established by each Commercial Bank are the credits disbursed and still outstanding during the first 5 (five) years of this Notice's validity, regardless of whether they are in regular status or in default, at the following percentages:
   a) Housing credit – 100% (one hundred percent); b) Construction credit – 50% (fifty percent).
2. Construction credits extended due to the project construction period exceeding 3 (three) years cease to be deductible from mandatory reserves.
3. Commercial Banks may effect the deduction of mandatory reserves in the week immediately following each disbursement of credits granted under this Notice.
4. Upon completion of the 5 (five) year period referred to in paragraph 1 of this article, the National Bank of Angola shall determine:
   a) The percentage of outstanding values deductible from mandatory reserves based on the difference between the interbank interest rate for a 30 (thirty) day term and the interest rates applied to credits granted under this Notice; b) The suspension of deductibility of outstanding values from mandatory reserves, as soon as the market interest rate converges with the interest rates established in this Notice.

Article 11.

(Information Reporting)
Commercial Banks must submit weekly to the National Bank of Angola a list of disbursed and active contracts, in the format and with the information to be defined in specific regulation.

CONTINUATION OF NOTICE NO. 09/2022 Page 9 of 9

Final Provisions

Article 12.

(Validity Period of the Notice)

1. This Notice shall remain in force for the granting of new credits or the restructuring of existing credits under the terms defined herein, for a period of 5 (five) years counted from the date of its entry into force, which period may be extended by the National Bank of Angola.
2. The conditions applicable to credits granted or restructured under this Notice, under its Article 4, shall remain in force for the validity period of each credit, regardless of the eventual revocation of this Notice.

Article 13.

(Sanctions)
Non-compliance with the provisions of this Notice constitutes an offense provided for and punishable under Law No. 14/21, of May 19 - General Regime Law for Financial Institutions.

Article 14.

(Doubts and Omissions)
Doubts and omissions resulting from the interpretation and application of this Notice shall be resolved by the National Bank of Angola.

Article 15.

(Entry into Force)
This Notice enters into force 60 (sixty) days after its publication.

PUBLISH.
Luanda, March 29, 2022.
THE GOVERNOR
JOSÉ DE LIMA MASSANO