Resolution 092/99: Approval of New Limits for External Investment of Gold Reserves

BOARD RESOLUTION NO. 092/99
SUBJECT: INTERNATIONAL OPERATIONS – APPROVES NEW LIMITS FOR INVESTMENT ABROAD OF GOLD RESERVES.

HAVING VIEWED:
Law 1670 of October 31, 1995, Chapter II, regarding the functions of the Central Bank of Bolivia (BCB) concerning International Reserves.
Board Resolution No. 090/99 of October 12, 1999, which approves the new Regulation for the Administration of International Reserves.
Board Resolution No. 054/99 of June 29, 1999, which approves the investment of International Reserves in gold.
Report from the International Operations Management (GOI) No. 017/99 of October 6, 1999.
Report from the Legal Affairs Management (SASJUR) No. 104/99 of October 8, 1999.

CONSIDERING:
That according to Report from the International Operations Management (GOI) No. 017/99, the provisions of Board Resolution No. 054/99 have been fully complied with, given that 75% of the gold with "London Good Delivery Bar" certification is invested abroad.

That Article 26 of the Regulation for the Administration of International Reserves stipulates that the BCB Board of Directors will authorize the maximum percentage of gold reserves to be invested abroad.

That Article 1 of Board Resolution No. 054/99 stipulates that from September 1999, up to 75% of gold reserves must be invested abroad, maintaining a minimum of 25% in the BCB vault.

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That the International Operations Management, in the aforementioned report, recommends the investment abroad of the remaining gold bars with good delivery certification, currently deposited in the BCB vault, through the establishment of time deposits.

That according to Report No. 104/99 from the Legal Affairs Management, it is within the authority of the Board of Directors to approve these operations.

THEREFORE,
THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA RESOLVES:

Article 1.- Authorize as the new limit for gold investment abroad, effective from this date, 100% of the holdings of this metal in bars.

Article 2.- Approve the investment in time deposits of up to seven point four (7.4) tonnes of gold, currently deposited in the vault of the Central Bank of Bolivia, in accordance with the Regulation for the Administration of International Reserves and the provisions of this Resolution.

Article 3.- The Internal Reserves Administration Committee shall be responsible for approving gold reserve investments, and must establish an investment schedule of 3 time deposits, with a maximum of two point five (2.5) tonnes of gold each, to be established by December 31, 1999. These investments must be executed applying the same procedures contemplated in Board Resolution No. 156/97, including competitive mechanisms based on a net deposit rate that incorporates a global discount for transport and insurance.

Article 4.- Upon completion of the gold investment process, the Internal Reserves Administration Committee, through the International Operations Management, will present a final report to the Board of Directors regarding the execution of the schedule and the performance of the aforementioned investment.

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Article 5.- Repeal Article 1 of Board Resolution No. 054/99.

Article 6.- The Presidency and General Management are charged with the execution and compliance of this Resolution.

La Paz, October 19, 1999

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Juan Antonio Morales A.

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Armando Pinell S. Jaime Ponce G.

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Juan Medinaceli V. Armando Méndez M.