Regulatory Alerts2001-04-24 | Resolución 034/2001Added · Updated
Resolution 034/2001
The Board of Directors of the Central Bank of Bolivia amends Articles 22 and 23 of the Internal Regulations for Operations under the ALADI Reciprocal Payments and Credits Agreement. The maximum debt limit for authorized institutions is reduced from 60% to 30% of their monthly reported accounting equity, and the maximum maturity for issued or guaranteed instruments is shortened from five years to one year. The resolution also annuls Annex I of Resolution 099/99, authorizes the BCB President to sign contracts with financial entities, and sets compliance deadlines of June 1, 2001, for the new maturity limit and August 31, 2001, for the debt limit.
BOARD RESOLUTION NO. 034/2001 SUBJECT: INTERNATIONAL OPERATIONS MANAGEMENT - APPROVES MODIFICATIONS TO THE INTERNAL REGULATIONS FOR OPERATIONS THROUGH THE ALADI RECIPROCAL PAYMENTS AND CREDITS AGREEMENT.
HAVING VIEWED: Law 1670 of October 31, 1995. Board Resolution No. 099/99 of November 23, 1999, which approves the new Internal Regulations for Operations through the Agreement of the Latin American Integration Association (ALADI) Reciprocal Payments and Credits. Report GOI No. 004/2001 from the International Operations Management dated April 23, 2001. Report GAL No. 052/2001 from the Legal Affairs Management dated April 24, 2001.
CONSIDERING: That Article 22 of the Internal Regulations for Operations through the ALADI Reciprocal Payments and Credits Agreement (CPCR) establishes that the maximum limit of the value of payment instruments issued and pending payment by Authorized Institutions shall not exceed sixty percent (60%) of their Accounting Equity.
That Article 23 of the same norm provides that the maximum term of instruments issued and/or guaranteed by Authorized Institutions shall not exceed five (5) years.
That Report No. 004/2001 from the International Operations Management establishes that on average the utilization margin of the Agreement does not exceed 16% and that the payment instruments issued are for the most part with a term of less than 1 year, recommending the modification of the utilization margins and the maximum term of instruments issued and/or guaranteed by authorized institutions.
//2. B.D. No. 034/2001 That the same Report highlights that the central banks of Brazil and Argentina have issued internal norms that have considerably reduced the issuance of Instruments through the CPCR-ALADI.
That in order to reduce the risk exposure of the Central Bank of Bolivia in granting the reimbursement guarantee, it is necessary to modify Articles 22 and 23 of the aforementioned Internal Regulations.
That in the opinion of the Legal Affairs Management, there is no legal impediment for the BCB Board to approve the modifications to Articles 22 and 23 of the Internal Regulations for Operations through the ALADI Reciprocal Payments and Credits Agreement.
That according to Article 54 subsection o) of Law 1670, the Board has the authority to modify the BCB Regulations by two-thirds of the votes of all its members, without the need for any additional administrative act.
THEREFORE, THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA RESOLVES:
Article 1.- Modify Article 22 of the Internal Regulations for Operations through the ALADI Reciprocal Payments and Credits Agreement, in the following terms: SAYS: Article 22 (Maximum debt limit) The maximum limit of the value of payment instruments issued and pending payment by Authorized Institutions shall not exceed sixty percent (60%) of their Accounting Equity reported monthly to the Bank by the Superintendence of Banks and Financial Entities.
SHOULD SAY: Article 22 (Maximum debt limit) "The maximum limit of the value of payment instruments issued and pending payment by Authorized Institutions shall not exceed thirty percent (30%) of their Accounting Equity reported monthly to the Bank by the Superintendence of Banks and Financial Entities."
Article 2.- Modify Article 23 of the Internal Regulations for Operations through the ALADI Reciprocal Payments and Credits Agreement, in the following terms: SAYS: Article 23 (Maximum term) The maximum term of instruments issued and/or guaranteed by Authorized Institutions shall not exceed five (5) years.
SHOULD SAY: Article 23 (Maximum term) "The maximum term of instruments issued and/or guaranteed by Authorized Institutions shall not exceed one (1) year."
Article 3.- Declare Annex I of Board Resolution No. 099/99 of November 23, 1999, null and void.
Article 4.- Authorize the President of the BCB to sign the respective contracts with financial entities.
Article 5.- The deadline for compliance with the maximum debt limit is established as August 31, 2001.
//4. B.D. No. 034/2001 Article 6.- The new maximum term for the issuance of Instruments shall enter into force on June 1, 2001.
Article 7.- The Presidency and General Management are charged with the execution and compliance of this Resolution.
La Paz, April 24, 2001
Juan Antonio Morales A.
Armando Pinell S. Jaime Ponce G.
Juan Medinaceli V. Armando Méndez M.
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