Resolution 117/2004

DIRECTORATE RESOLUTION NO. 117/2004
SUBJECT: FINANCIAL ENTITIES MANAGEMENT – COMPLEMENTS ARTICLE 89 OF THE REGULATION ON PORTFOLIO ADMINISTRATION AND SALE OF ASSETS MODIFIED BY DIRECTORATE RESOLUTION NO. 093/2004 OF JUNE 29, 2004.

SEEN:
Law No. 1670 of October 31, 1995.
Supreme Decree No. 26688 of July 5, 2002.
Supreme Resolution No. 218899 of October 15, 1999.
Statute of the Central Bank of Bolivia of December 13, 2001.
Directorate Resolutions No. 093/99 of October 15, 1999, No. 101/99 of November 23, 1999, No. 077/2002 of July 16, 2002, and No. 093/2004 of June 29, 2004.
Administration Mandate Contract of December 1, 1999.
Report from the Financial Entities Management GEF-SRRA No. 214/2004 of August 9, 2004.
Internal Communications from the Legal Affairs Management SAJU No. 089/2004 of July 21, 2004.

CONSIDERING:
That the Board of Directors, with the authority conferred by subsection a) of Article 54 of Law 1670, through Resolution No. 093/2004, has ordered the modification of Article 89 of the Regulation on Portfolio Administration and Sale of Assets, which contemplates a direct sale procedure for cases of the sale of rural assets adjudicated in the credit recovery process of the portfolio corresponding to the return of the Irregular Mercantile Deposit (BCB IV), in which there is a formal purchase offer and whose custody and dispossession is difficult and costly.

That it is necessary to clarify in which cases the requirement of possession of the asset will not be required of the mandate holder, as established in Article 103, Chapter IX, Section 3 of the Regulation on Portfolio Administration and Sale of Assets, modified by Directorate Resolution No. 077/2002, which determines that the sale process will begin whenever the proprietary right of the BCB is perfected and registered in the corresponding records and that the mandate holder is in possession of the assets.

That Supreme Resolution No. 218899 establishes the rules by which the Central Bank of Bolivia will be governed in the administration of assets resulting from financial support granted for the strengthening, intervention, or liquidation of financial entities.

That Report GEF-SRRA No. 214/2004 considers that the complement to Article 89 of the Regulation on Portfolio Administration and Sale of Assets, requested by the Legal Affairs Management, will allow for adequate execution of the asset sale procedures of the properties under the Administration Mandate, and recommends carrying out said complement.

That Report SAJU No. 089/2004 states that in order for the mandate holder's work to sell real estate to be carried out without observation, it recommends complementing the third paragraph of Article 89 of the Regulation on Portfolio Administration and Sale of Assets.

THEREFORE

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

Article 1.- Clarify Article 89 of the Regulation on Portfolio Administration and Sale of Assets modified by Directorate Resolution No. 093/2004 of June 29, 2004, in the following terms:

SAYS:
Article 89.- Direct sale contemplates publications and promotion in the main written media of the country.
Purchase proposals in the direct sale modality will be presented to the Mandatary in closed envelopes. In the event that the offered price is lower than the book value or the last appraisal, the Mandatary will consult the Recovery and Realization Committee of the Mandator, which will pronounce itself within a period not exceeding five (5) days. If it does not do so within the specified period, the proposal will be understood as approved. The procedure described in the preceding paragraphs may be modified by the Mandatary in those cases of rural assets adjudicated in the credit recovery process of the portfolio corresponding to the return of the Irregular Mercantile Deposit (BCB IV) in which there is a formal purchase offer and whose custody and dispossession is difficult and costly. To that effect, once the formal purchase proposal is received, the Mandatary will carry out the sale publications in which the existence of occupants in the property and the exclusion of the seller's responsibility regarding eviction and title clearance of the property on this aspect will be recorded. Fifteen (15) days after the publication, it will send all proposals, including the formal purchase offer, to the Recovery and Realization Committee of the BCB, for its consideration and approval, accompanied by a legal, technical, and financial report on the convenience of the sale, provided that the offered value is equal to or greater than the commercial value of the last updated appraisal, but not lower than the quick sale value.

SHOULD SAY:
“Article 89.- Direct sale contemplates publications and promotion in the main written media of the country.
Purchase proposals in the direct sale modality will be presented to the Mandatary in closed envelopes. In the event that the offered price is lower than the book value or the last appraisal, the Mandatary will consult the Recovery and Realization Committee of the Mandator, which will pronounce itself within a period not exceeding five (5) days. If it does not do so within the specified period, the proposal will be understood as approved. The procedure described in the preceding paragraphs may be modified by the Mandatary in those cases of rural assets adjudicated in the credit recovery process of the portfolio corresponding to the return of the Irregular Mercantile Deposit (BCB IV) in which there is a formal purchase offer and whose custody and dispossession is difficult and costly. In these cases, the requirement of being in possession of the asset, established in Article 103 of this Regulation, will not be required of the mandate holder. To that effect, once the formal purchase proposal is received, the Mandatary will carry out the sale publications in which the existence of occupants in the property and the exclusion of the seller's responsibility regarding eviction and title clearance of the property on this aspect will be recorded. Fifteen (15) days after the publication, it will send all proposals, including the formal purchase offer, to the Recovery and Realization Committee of the BCB, for its consideration and approval, accompanied by a legal, technical, and financial report on the convenience of the sale, provided that the offered value is equal to or greater than the commercial value of the last updated appraisal, but not lower than the quick sale value.”

Article 2.- The Presidency and General Management are charged with the execution and compliance of this Resolution.
La Paz, August 10, 2004

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Juan Antonio Morales A.

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Juan Medinaceli V. Enrique Ackermann A.

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José Luis Evia Fernando Paz B.