Resolution 112/98

BOARD RESOLUTION NO. 112/98

SUBJECT: AUTHORIZES THE SIGNING OF A DEBT SETTLEMENT AGREEMENT WITH THE LIQUIDATING BOARD OF BANVI IN LIQUIDATION.

HAVING SEEN:

The General Banking Law of July 11, 1928.

Law No. 1670 of October 31, 1995, and the Statute of the BCB of February 20, 1997.

Supreme Decree No. 21660 of July 10, 1987.

Note INT.BANVI No. 290/98 from the Liquidating Board of the Housing Bank S.A.M. dated December 10, 1998.

Reports from the Financial System Management SEL-DEL 243/98 and SEL-DEL 291/98.

Report from the Internal Audit Unit No. 033/98/98 dated December 17, 1998.

Note from the Legal Advisory Office ALEG 422/98 dated December 21, 1998.

CONSIDERING:

That the General Banking Law of 1928 confers powers on the Liquidating Intendants, legally designated by the Superintendent of Banks, to sell or dispose of the assets of entities in liquidation, with prior judicial authorization. Likewise, it empowers the Liquidating Intendants to pay approved claims in the order of precedence established by the Judgment of Degrees and Preferences issued by the Liquidation Judge.

That Law No. 1670 in its Article 54, subsection p), and the BCB Statute in its Article 14, subsection p), confer powers on the Board of Directors to approve the acquisition of movable and immovable goods, as well as to authorize the signing of inter-institutional agreements.

That Supreme Decree No. 21660, in its Article 39, provides for the Liquidation of the Housing Bank S.A.M. and that the Central Bank of Bolivia exceptionally cover, since the State is the majority shareholder of said entity, the difference that may result between the value at which the assets are liquidated and the value of the liabilities, including the social benefits of its personnel, public deposits, and legally and legitimately contracted debts.

That it is necessary to expedite the closing process of the Housing Bank S.A.M. in Liquidation, otherwise, the administrative costs of the liquidation will continue to erode the recoverable assets of this entity and the liabilities to be covered by the BCB will be increasingly larger, to the detriment of the BCB.

That according to Internal Audit recommendations, it is necessary to carry out the corresponding actions to recover the unpaid claims to date.

That through note INT.BANVI No. 290/98, the Liquidating Board of the Housing Bank S.A.M. formalized its payment offer accepting the result of the negotiation held with the Financial System Management of the BCB.

That in its report SEL-DEL No. 243/98, the Financial System Management informed the Board of Directors of the current financial situation of the Housing Bank S.A.M., as well as the status of the claims this entity has with the BCB, suggesting negotiation policies that allow expediting its closure. Likewise, through Report SEL-DEL 291/98, said Management indicates that the negotiation with the Liquidating Board has concluded, recommending to the Board of Directors to accept the negotiated debt settlement offer, as it represents the best alternative for the BCB to at least recover part of its claims.

That note ALEG 422/98 from the Legal Advisory Office establishes that it is the authority of the Board of Directors to authorize the signing of the inter-institutional agreements that the Bank enters into.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Accept the negotiated debt settlement offer between the Financial System Management and the Liquidating Board of the Housing Bank S.A.M., according to which the entity in liquidation, after paying its liabilities to third parties with the External Audit Closing Opinion, will transfer all its remaining assets to the BCB according to the following table:

OFFER OF ASSETS FOR DEBT SETTLEMENT (Expressed in Dollars)

Entity in Liquidation	Offer of Debt Settlement
Housing Bank S.A.M.	Offered Asset
Negotiated Offer
Cash	575,983.88
Portfolio	143,491.24
Real Estate	83,992.75
Total	803,467.87

Article 2.- Authorize the write-off of unpaid balances of accounts receivable charged against provisions made, as well as the reversal of remaining provisions, once the price of the debt settlement is recorded.

Article 3.- Authorize the President of the BCB to sign the Debt Settlement Agreement with the Liquidating Board of the Housing Bank S.A.M., with powers to adjust the amounts and the composition of the assets based on the date of signing the Agreement, being required to report on this matter to the Board of Directors.

Article 4.- The Legal Affairs Unit will be responsible for homologating the Agreement before the Liquidation Judge.

Article 5.- The Presidency and the General Management are tasked with executing this Resolution.

La Paz, December 17, 1998

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Juan Antonio Morales A.

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__________________ Armando Pinell S. Jaime Ponce G. Fernando Campero