BANK OF ANGOLA

NOTICE NO. 14/2011

of December 19

OFFICE OF THE GOVERNOR

Whereas it is necessary to regulate the operation of financial assignment companies (factoring), with a view to developing the matter established in Presidential Decree No. 95/11 of April 28;

In accordance with the combined provisions of paragraph f) of number 1 of Article 21 and paragraph d) of number 1 of Article 51, both of Law No. 16/10 of July 15 (Bank of Angola Law), combined with the provisions of number 2 of Article 6 of Law No. 13/05 of September 30 (Financial Institutions Law);

I HEREBY DETERMINE:

Article 1.

(Subject Matter)

1. This instrument regulates the establishment and operation process of financial assignment companies (factoring).

Article 2.

(Processing of the Authorization Application for Establishment and Operation)

1. The authorization application for the establishment and operation of financial assignment companies must be submitted via a petition addressed to the Governor of the Bank of Angola, as per Annex I to this Instrument, accompanied by all documents and information useful for its assessment, including the following mandatory minimum elements:

   a) draft statutes of the company to be established; b) certificate of acceptability of the company name, issued by the competent authority; c) identification of founding shareholders, namely identification document, address, telephone, fax and e-mail; d) capital to be subscribed by each founding shareholder, represented in cash and percentage, as per the table in Annex II; e) proof of the origin of shareholders' funds; f) criminal record certificate of the shareholders; g) certificate confirming the absence of overdue debts owed by shareholders to state authorities; h) identification and supporting elements demonstrating the technical capacity of persons proposed for management and supervisory bodies; i) declaration by members of management and supervisory bodies attesting that neither they nor companies or enterprises over which they ensure or have ensured control, or in which they have served as administrators, directors or managers, have been declared bankrupt or insolvent; j) criminal record certificate of persons proposed for management and supervisory positions; k) designation of a bank domiciled in Angolan territory, with which it will handle all matters related to the Bank of Angola; l) shareholders' agreements, if any; m) business plan and feasibility study for the first three years, including:
   i. analysis of the target market;
   ii. proposed organizational structure;
   iii. services offered;
   iv. technologies to be used in the distribution of products and services, as well as the sizing of the service network;
   v. projection of preliminary expenses, including all costs related to the establishment and setting up of the company;
   vi. balance sheets and projected income statements, including:
   1. revenues and commissions;
   2. expenses of projected operations, as well as the cost of resource mobilization, investments including technological and fixed expenses;
   3. other revenues, including consulting services provided to clients and services provided to third parties.
   vii. corporate governance standards to be observed, which must include:
   1. identification of responsibilities assigned to the various organizational levels of the institution;
   2. descriptive proposal of the internal control structure;

2. Regarding shareholders that are legal entities, the authorization application must also be accompanied by the following elements:
   a) statutes or partnership agreement of the applicant; b) organizational chart of the economic group to which it belongs; c) authorization document from the competent corporate body of the applicant, or legal representatives with sufficient powers, to authorize participation in the financial leasing company to be established;

3. Applicants must designate one among themselves, via power of attorney, to represent all before the authorities responsible for assessing the authorization application and indicate a domicile in Angola for notification or correspondence purposes.

4. The Bank of Angola may request any supplementary information or procedures from applicants, conduct investigations it deems necessary or useful for the decision on the application, and summon shareholders and administrators for interviews.

5. The Bank of Angola may waive the submission of elements referred to in this article that it already possesses or has knowledge of.

Article 3.

(Share Capital)

Financial assignment companies must have their share capital fully paid up in national currency in the amount of AKZ 50,000,000.00 (Fifty Million Kwanzas), and their own funds must not be lower than this amount.

Article 4.

(Payment of Share Capital)

1. The minimum share capital must be fully paid up on the date of establishment of the financial assignment company, and its corresponding amount deposited in a banking financial institution domiciled in the country.

2. Upon subscription of the initial share capital, when it exceeds the legally established minimum, payment of at least 50% of the subscribed amount exceeding the minimum share capital is required, and the remainder of this initial amount must be fully paid within six (6) months from the date of establishment of the financial institution.

Article 5.

(Increase of Share Capital)

In case of an increase in the share capital of financial assignment companies, the provisions of Law No. 13/05 of September 30 - Financial Institutions Law, and Law No. 1/04 of February 13 - Commercial Companies Law shall apply, with the necessary adaptations.

Article 6.

(Resource Mobilization)

To pursue their objectives, financial assignment companies may:
a) obtain financing from legally authorized banking financial institutions; b) obtain financing from international financial institutions; c) issue bonds of any kind, within the terms and limits of the Commercial Companies Law, as well as commercial paper; d) obtain supplies and other forms of loans and advances from their respective partners or shareholders; e) carry out legally permitted treasury operations with companies with which it maintains a controlling or group relationship.

Article 7.

(Minimum Regulatory Solvency Ratio)

1. Financial assignment companies (factoring) authorized to operate by the Bank of Angola must maintain a level of own funds compatible with the nature and scale of their operations, as well as with inherent risks, maintaining the Regulatory Solvency Ratio (RSR), in accordance with Notice No. 05/07 of September 12.

2. For the purpose of determining the minimum regulatory solvency ratio referred to in the preceding number, the following shall be observed:
   a) for the calculation of exchange rate risk, the provisions of Notice No. 05/10 of November 10 and Instructional Circular No. 06/07 of September 12; b) for the calculation of exposure to credit risk in the form of financial assignment, the provisions of Instructional Circular No. 03/11 of June 8.

Article 8.

(Limits on Investments)

In addition to the limits provided in Notice No. 08/07 of September 12, financial assignment companies (factoring) must observe a limit of 15% of Regulatory Own Funds in investments in securities and financial instruments issued by the same company, affiliated companies, and their subsidiaries.

Article 9.

(Prohibitions)

Financial assignment companies are prohibited from carrying out the following acts:
a) conduct financial assignment operations with related parties; b) take financial stakes in the capital of other companies, except in their branches, agencies or other forms of representation.

Article 10.

(Classification and Provisioning of Credits)

1. Financial assignment companies must classify acquired credits, creating respective provisions according to the level of risk assumed, as established in Notice No. 04/2011 of June 8, with the necessary adaptations:

Article 11.

(Guarantees)

Any guarantees, personal or real, relating to acquired credits, other charges or eventual indemnities under the non-recourse factoring contract may be established in favor of the assignee (factor).

Article 12.

(Fixed Asset Limit)

Financial assignment companies (factoring) must observe the provisions of Notice No. 06/2011 of July 13 when calculating the fixed asset limit.

Article 13.

(Accounting)

Financial Assignment Companies (factoring) must carry out the accounting registration of their operations, in accordance with the Financial Institutions Chart of Accounts in force, adopting headings that address these operations.

Article 14.

(Information System)

The information system of Financial Assignment Companies (factoring) must be sufficiently robust to ensure that the accounting application is compatible with the chart of accounts of financial institutions and allows their operations to have a direct impact on their accounting.

Article 15.

(Information Reporting)

1. Financial assignment companies must submit monthly, by the 8th day of the following month, the Information Map on financial assignment operations, as per Annex III.

2. Financial assignment companies must submit quarterly, within 8 days after the end of each quarter, the trial balance reporting the institution's overall position;

3. The documents referred to in the preceding numbers of this article must be sent to the Bank of Angola, in XML format, through the Financial Institutions Supervision System - SSIF.

4. Until conditions are created for submission in the system (SSIF), information must be sent via other electronic devices (Excel file) to the e-mail of the Financial Institutions Supervision Department (dsi@lda.bna.ao).

5. For the purposes of number 2, the reference dates are March 31, June 30, September 30 and December 31.

6. Financial assignment companies must publish by April 30 of the following year the financial statements for each fiscal year, as well as the External Audit Report and, if applicable, the Supervisory Board Opinion, in a publication medium easily accessible to the public, and submit them to the Bank of Angola by that date.

7. Financial assignment companies must appoint a qualified spokesperson authorized to respond to any questions regarding information reported to the Bank of Angola.

8. Financial assignment companies must ensure the permanent availability of the designated spokesperson, obligatorily appointing a substitute, definitive or temporary, in case of impediment to the designated spokesperson.

Article 16.

(Information and Credit Risk Center)

Financial assignment companies (factoring) must submit to the Information and Credit Risk Center (CIRC) customer information regarding financial assignment operations, in accordance with Instructional Circular No. 05/10 of October 4.

Article 17.

(External Audit)

1. Financial assignment companies must submit their financial statements annually to external audit, conducted by an independent auditor.

2. The independent auditor must report to the Financial Institutions Supervision Department, the work carried out and respective results, infringements and facts that may affect the continuity of the financial assignment company's activity.

3. For the purposes of this article, the independent auditor may be a duly authorized audit firm or a certified accountant duly registered with the Order of Certified Accountants and Auditors.

Article 18.

(Archiving Duty)

1. Financial assignment companies (factoring) must keep in archives for a period of ten (10) years the documents and elements relating to their active or passive operations, separated by branches.

2. Financial assignment companies must maintain an information security system as described in the preceding number of this article, to ensure protection, confidentiality and recovery. The security system must be periodically subjected to robustness tests, reviews and updates, incorporating procedures related to new risks or previously unidentified risks.

Article 19.

(Sanctions)

Failure to comply with the deadlines for sending periodic information established by the Bank of Angola is punishable per day of delay, with a fine corresponding to 1% (one percent) of the minimum share capital defined for financial assignment companies, divided by 360 (three hundred and sixty) days, applicable to each document.

Article 20.

(Entry into Force)

This Notice enters into force 30 days after the date of its publication.

PUBLISH

Luanda, December 19, 2011

THE GOVERNOR
JOSÉ DE LIMA MASSANO

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Annex I

APPLICATION FOR AUTHORIZATION TO ESTABLISH A FINANCIAL ASSIGNMENT COMPANY (FACTORING)

Company Name:
[ ]

Registered Office Address:
[ ]

Person responsible for managing the authorization process with the BNA:
Name: [ ]
Telephone: [ ] Fax: [ ]
E-mail: [ ]

The members of the organizing group of the financial assignment company identified above:
I - Hereby request the Bank of Angola for the appropriate authorization to exercise the financial assignment activity.
II - Inform that the founding partners or shareholders of the financial assignment company are:
(list name, identification document, full address, telephone and e-mail of all founding members) III - Attach the documents indicated below:
[ ] Business plan and economic-financial feasibility study; [ ] Certificate of acceptability of the desired company name, issued by the competent authority; [ ] Draft statutes of the financial assignment company; [ ] Share capital map, reflecting its distribution among partners or shareholders in cash and percentage; [ ] Identification (identification document and address) of all founding partners or shareholders, members of the proposed management and supervisory bodies; [ ] Documents proving the origin of partners' or shareholders' funds, according to the participations subscribed in the share capital; [ ] Criminal Record of all partners or shareholders; [ ] Curricula vitae of the members of the management and supervisory bodies; [ ] Supporting elements demonstrating the technical capacity of the proposed members of the management and supervisory bodies; [ ] Proof of prior deposit corresponding to 5% of the minimum share capital or guarantee; [ ] Shareholders' agreements; [ ] In case of partners or shareholders that are legal entities:
[ ] Corporate statutes;
[ ] Organizational chart of the economic group to which it belongs; [ ] Declaration by the competent corporate bodies regarding participation in the proposed company.

Attach the following documents or information necessary for the analysis of this application:
(list documents not indicated in the items above)

Place and date.
Signatures:
[ ] (full name) [ ] (full name)

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Annex II

SHARE CAPITAL MAP

N.º de Ordem	Sócios ou Accionistas	N.º de Quotas ou Acções	Valor Kwanzas	Percentagem