Resolution 128/2005 Approving the New Statute of the Central Bank of Bolivia

RESOLUTION OF THE BOARD OF DIRECTORS NO. 128/2005 SUBJECT: BOARD OF DIRECTORS – APPROVES NEW STATUTE OF THE CENTRAL BANK OF BOLIVIA.

VIEWED:
Law No. 1670 of October 31, 1995.
The Statute of the BCB, approved by Board Resolution No. 128/2001 of December 13, 2001, and modified by Board Resolutions 120/2004 of August 17, 2004, 178/2004 of November 30, 2004, and Board Resolution No. 091/2005 of August 9, 2005. Board Resolution No. 086/2005 of July 19, 2005, which approves the new Organizational Structure of the BCB. The Report from the Legal Affairs Management SANO No. 279/2005 of October 21, 2005.

CONSIDERING:
That in accordance with Article 54 subsection o) of Law No. 1670 and Article 11 numeral 30) of the BCB Statute, the Board has the authority to approve, modify, and interpret the Statute and Regulations of the BCB, by two-thirds of the votes of all its members, without the need for any additional administrative act.

That it is necessary to modify the BCB Statute in order to adapt it to the new organizational structure of the Issuing Entity, approved by Board Resolution No. 086/2005.

That having approved a new organizational structure for the BCB, the Legal Affairs Management, through Report SANO No. 279/2005, considers it appropriate to approve a new Statute that incorporates the modifications made to it prior to the approval of the new structure, as well as all proposed modifications among the different areas of the BCB.

That the Legal Affairs Management, in the aforementioned report, recommends the approval of the new statute of the Issuing Entity, as its text does not contravene the current legal framework.

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

Article 1.- Approve the new Statute of the Central Bank of Bolivia, in its XIV chapters and 90 articles, which forms part of this Resolution as an annex.

Article 2.- The new Statute will enter into force as of October 21, 2005.

Article 3.- Repeal as of October 21, 2005, the Board Resolutions 128/2001 of December 13, 2001, 120/2004 of August 17, 2004, 178/2004 of November 30, 2004, and 091/2005 of August 9, 2005.

Article 4.- The Presidency and General Management are charged with the execution and compliance of this Resolution.

La Paz, October 21, 2005

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Juan Antonio Morales A.

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Enrique Ackermann A. Fernando Paz B.

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Jaime Apt B.

ANNEX
STATUTE OF THE
CENTRAL BANK OF BOLIVIA

CHAPTER I
ON THE NATURE AND OBJECTIVE OF THE BCB

Article 1.- (Objective)
The present Statute regulates the organization and activities of the BCB, in the manner and scope established by the Law of the Central Bank of Bolivia, No. 1670 of October 31, 1995, and other current laws.

Article 2.- (Nature)
The Central Bank of Bolivia (BCB) is a state institution, of public law, of an autarkic nature, of indefinite duration, with its own legal personality and assets.

Article 3.- (Objective of the BCB)
The objective of the BCB is to procure the stability of the internal purchasing power of the national currency.

Article 4.- (Legal Domicile)
The BCB has its legal domicile in the city of La Paz, Ayacucho street corner Mercado, headquarters of its main building.

Article 5.- (Subject to the Law)
The BCB is subject to compliance with the provisions contained in its Law, related legal norms, this Statute, and its internal regulations.

Article 6.- (Competencies)
According to Law No. 1670, the BCB has normative, administrative, technical, and financial competence:

1. Normative, to issue specialized norms in the fields assigned to it by the Law.
2. Administrative, to establish its own ordering, organization, and functions in the administrative field, in concordance with the specialized nature of the institution and within the framework of national legislation.
3. Technical, for the formulation of policies and the application of instruments that allow it to fulfill its objective.
4. Financial, to formulate, approve, and execute its budget.

Article 7.- (Approval of Norms)
The norms issued by the BCB will be approved by resolutions of its Board of Directors.

CHAPTER II
ON THE DIRECTION AND ADMINISTRATION OF THE BANK

Article 8.- (Superior Direction)
The superior direction and administration of the Bank are in charge of:

1. THE BOARD OF DIRECTORS
2. THE PRESIDENT
3. THE GENERAL MANAGER
4. THE AREA MANAGERS
   The other levels of administration, from the sub-managerships onwards, are regulated in the Organization and Functions Manual of the BCB.

Article 9.- (Board of Directors)
The Board of Directors is the highest authority of the Institution. It is composed of the President and five Directors elected in accordance with Article 45 of Law No. 1670. The Directors assume office on the day of their swearing-in.

Article 10.- (Impediments and Obligations)
Before exercising functions, each Director will present to the Board Secretary a sworn declaration of not being impeded by the causes indicated in Article 47 of Law No. 1670. Any subsequent impediment arising after the swearing-in must be communicated immediately and in writing to the President of the Bank for legal purposes.

Article 11.- (Powers of the Board of Directors)
Within the framework of Law No. 1670, the Board of Directors has the following powers:

1. Approve general decisions and issue the norms that are necessary for the BCB to fulfill the functions, competencies, and faculties assigned to it by the Law.
2. Define the policies of the BCB, specialized normative rules of general application and internal norms; as well as establish administrative, operational, and financial strategies of the BCB by approving its short and medium-term programs.
3. Approve the annual Monetary Program and its modifications, as well as monitor its execution.
4. Approve the policy and norms for Open Market operations, as well as monitor their execution.
5. Approve the policy and norms for the administration of International Reserves, as well as monitor their execution.
6. Authorize the contracting of credits intended to strengthen the level of international reserves.
7. Establish, by absolute majority of votes, legal reserves of mandatory compliance by financial intermediation entities and approve their composition, amount, calculation, characteristics, forms of administration, custody, and remuneration, according to Regulation.
8. Approve the Regulation for the granting of liquidity credits of less than 90 days, to financial intermediation entities with legal reserve guarantee.
9. Approve by absolute majority of votes, liquidity credits of 90 days, renewable, to financial intermediation entities, according to Regulation.
10. Approve by two-thirds of the votes of the members present, credits to the General Treasury of the Nation (TGN) to attend to urgent needs derived from public calamities, internal or international commotion, declared by Supreme Decree, and those of temporary liquidity needs, within the limits of the Monetary Program.
11. Approve the printing, issuance, and destruction of Boliviano banknotes and coins, and those issued for commemorative and numismatic purposes as well as their denominations, dimensions, designs, and colors, according to Regulations when applicable.
12. Determine the exchange rate regime and exchange rate policy.
13. Approve the norms for the functioning of the payment system.
14. Define the organic structure of the Bank and its modifications at all levels.
15. Approve, by express Resolution and by absolute majority of all its members, the designation of the General Manager made by the President. The General Manager cannot take office or assume functions until they have this approval.
16. Approve the removal of the General Manager, for the causes established in Article 50 of Law No. 1670, or by vote of the absolute majority of all its members.
17. Approve, by simple majority of votes of its members present in meeting, the designation of the Economic Policy Advisor and the Managers designated by the President. The designees cannot take office in their positions or assume functions until they have this approval.
18. Designate, with the vote of the absolute majority of all its members, the Internal Auditor from a slate proposed by the President. The Internal Auditor may be removed for the causes indicated in Article 50 of Law No. 1670 or by decision of the absolute majority of the total members of the Board of Directors.
19. Designate, by simple majority of votes, the Sub-Managers of Audit from slates proposed by the President.
20. Approve, by simple majority of votes, the suspension or dismissal of the Bank's executives whose designation was approved by the Board of Directors, with the exception of references to subsections 16 and 18 of this Article.
21. Approve the financial statements and annual reports of the BCB, as well as the guidelines of the policies that will be applied in the next management. Define the capitalization of the BCB's profits and order the creation of special reserves.
22. With the approval of the Board of Directors, the BCB may assume the representation of the State before international and multilateral organizations of a monetary nature.
23. Approve the regulation of the services provided by the BCB in its capacity as the government's financial agent.
24. Regulate financial operations with the exterior carried out by public and private persons or entities.
25. Approve the regulations regarding the registration of public and private debt.
26. Authorize the creation of Clearing Houses and regulate their functioning.
27. Decree bank holidays.
28. Approve the Annual Operations Programming (POA), the Bank's budget, and intra-institutional transfers.
29. Approve, modify, and interpret the Statute and Regulations of the BCB, by two-thirds of the votes of all its members, without the need for any additional administrative act.
30. Approve the policies and regulations regarding the internal regime of the BCB and human resources administration.
31. Approve the annual financial support destined to the BCB Cultural Foundation, for its incorporation into the Bank's budget.
32. Resolve the revocation appeals, within the legal timeframes provided, and the hierarchical appeals filed against the decisions of the President and the General Manager.
33. Approve inter-institutional agreements that require expenditures of the BCB's own resources and technical cooperation agreements, national and international, that the BCB receives or grants, evaluating their compliance periodically.
34. Approve the internal regulations regarding the contracting and disposal of goods and services, based on the Basic Norms of Administration of Goods and Services.
35. Authorize the alienation and leasing of the BCB's movable and immovable assets, so that General Management carries out the corresponding bidding and contracting processes according to current legal norms and Regulation.
36. Authorize the alienation and administration of portfolio and assets received in lieu of payment from banks in liquidation.
37. Approve the BCB's shareholding participation in international financial entities of public law linked to its functions.
38. Appoint the Bank's representatives before other institutions, when applicable.
39. Approve the trips abroad that the President, Directors, and General Manager make on behalf of the BCB.
40. Designate an Area Manager as Acting General Manager due to impediment or absence of the holder for a period of more than 45 business days.
41. Approve the Organization and Functions Manual of the BCB and its modifications.
42. Create and regulate decision-making committees and hire advisors when deemed convenient and in the manner determined.
43. Establish levels of responsibility, according to the hierarchy of BCB officials, in the fulfillment of functions and competencies and in the signing of documents concerning the Bank.
44. Entrust the General Manager to elaborate, in coordination with the Area Managers, the necessary regulation for the implementation of laws and general norms, as well as for the timely execution of the Board's decisions, in the areas of their respective competencies.
45. Annually fix the table of commissions that the Bank must charge for the services it provides.
46. Regulate the modalities and conditions of declarations in commission for officials, special permissions to provide advice to other entities on matters of interest to the Institution, and their temporary assignment to entities of the Public Sector.
47. Define the information and dissemination regime, as well as the disclosure of the Bank's policies and decisions.
48. Review the reports issued by the Superintendence of Banks and Financial Entities regarding the financial system.
49. Approve the Annual Internal Audit Operational Program and evaluate its execution quarterly.
50. Define the annual calendar of activities of the Board of Directors.
51. Other attributions that are necessary for the fulfillment of its functions.

Article 12.- (Full-Time Directors)
At the beginning of each management, for reasons of service and according to institutional needs and purposes, the Board of Directors may assign one or more of its members full-time functions and exclusive dedication for management, by express resolution adopted by absolute majority of votes. The remunerations received by full-time Directors will be subject to the same legal conditions applicable to the remuneration of the BCB President. Full-time Directors have the right to legal vacations and will report their use to the Board Secretary.

Article 13.- (Part-Time Directors)
Part-time Directors receive per diems for their attendance at Board of Directors Meetings. The Board of Directors may also entrust these Directors with the performance of functions or commissions on a full-time basis, for defined brief periods and for the fulfillment of specific tasks. In the latter case, the days worked in the assigned labor or commission will be remunerated pro rata, taking as reference the salary of one month of a full-time Director.

Article 14.- (Directors with domicile in a place different from the city of La Paz)
The Bank will cover the travel and per diem expenses of Directors with domicile in the interior of the country. It will also cover such expenses when Board of Directors meetings are held in a place different from its headquarters.

CHAPTER III
ON BOARD OF DIRECTORS MEETINGS

Article 15.- (Periodicity)
Ordinary meetings will be held once a week, and extraordinary ones, as many times as the Board of Directors deems convenient or as stipulated in Article 18.

Article 16.- (Venue)
The Board of Directors meetings will be held at the Bank's legal domicile. The Board of Directors may meet in another place different from its headquarters, by decision of the absolute majority of its members.

Article 17.- (Convocation)
The convocation to ordinary Board of Directors meetings is made in writing through the Board Secretary, who is responsible for distributing, with due advance notice, the agenda and corresponding documentation.

Article 18.- (Extraordinary Meetings)
The President of the Board of Directors may convene as many extraordinary Board of Directors meetings as he deems convenient. At the request of two or more Directors, the President will convene the extraordinary sessions that are considered necessary.

Article 19.- (Quorum)
The quorum for Board of Directors meetings is four of its members, including the President.

Article 20.- (Licenses)
Directors who cannot attend a session must request the respective license from the President, through the Board Secretary, for its registration in the minutes.

Article 21.- (Agenda)
It is the President's responsibility to instruct the convocation to Board of Directors meetings and establish the topics that form part of the agenda of each meeting. At the request of one or more Directors, other topics may be included in the agenda.

Article 22.- (Alteration of the Agenda)
The agenda may be altered by decision of the Directors who attend the session.

Article 23.- (Consideration of Minutes)
At the beginning of each ordinary meeting, the minutes of the previous session must necessarily be considered.

Article 24.- (Voting)
The resolutions and decisions of the Board of Directors are adopted by simple majority of votes of the members present in the meeting, except in cases where Law No. 1670 or this Statute require qualified majorities. The required votes are as follows:

Nº of Members present in Board of Directors	Simple Majority	Absolute Majority of 2/3 of Total Directors	Absolute Majority of 2/3 of Members Present
6	4	4	4
5	3	3	4
3	3	3	3

The President has the casting vote in case of a tie.
Directors cannot abstain from voting. In case of dissent, they must justify their position, which will be recorded in the minutes.

Article 25.- (Confidentiality and Magnetic Recording)
Board of Directors meetings are reserved in accordance with Article 80 of Law No. 1670. By two-thirds of the votes of all its members, the Board of Directors may approve that certain meetings or certain topics be recorded on magnetic media. The recordings will be the responsibility of the Board Secretary and will have strictly confidential character. As established by the Law of the Central Bank of Bolivia No. 1670: Board of Directors minutes will have full probative value for all legal effects.

Article 26.- (Resolutions)
The Board of Directors pronounces itself on matters within its competence through resolutions. It may also do so through decisions that will be expressly recorded in the minutes.

Every draft resolution of the Board of Directors must be motivated and justified by a technical report from the Management or Managements to whom the subject matter of the resolution corresponds, and by a report from the Legal Affairs Management. These reports must be sent to the Board of Directors by the General Management with its recommendation, except in technical matters corresponding to the Economic Policy Advisory, which may submit reports to the Board of Directors with its own recommendation.

Article 27.- (Participation of Managers and Other Officials)
The General Manager attends Board of Directors meetings with the right to speak but without vote. By instructions of the President, he may present the different topics contemplated in the agenda, related to Administration. The President may excuse the attendance of the General Manager. Advisors, Managers, and Sub-Managers may be summoned to Board of Directors sessions, when their presence is necessary to deal with matters related to their area. The Board of Directors may invite other people for the consideration of specific matters.

Article 28.- (Minutes and Resolutions)
The Board of Directors minutes are structured as follows:
I. Place, day, and time when the meeting begins and concludes, and list of participants;
II. Agenda;
III. Reports and decisions adopted;
IV. Complete transcription of the approved resolutions.

Board of Directors resolutions have the following structure:
SUBJECT: Identification of the proposing area and summary of the topic.
VIEWED: List of background and technical and legal report.
CONSIDERING: Exposition of arguments and justification of the proposals or proposals.
RESOLUTIVE: Space intended to reflect the resolutions adopted, the entry into force date, and the authorities responsible for their execution.

The minutes and resolutions bear the name and signature of the President and the Directors who attend the meeting, as well as the sequential identification number and the date on which they are issued.

Article 29.- (Dissemination of Norms of General Application)
The Bank will publish in the Annual Report the norms of general application issued by the Board of Directors. It may also disseminate them in informational bulletins or in informational and national dissemination media.

Article 30.- (Board of Directors Secretariat)
The Board of Directors Secretariat is in charge of a Secretary who will have a category equivalent to an Area Sub-Manager in the Bank's hierarchical structure. It depends directly on the Board of Directors and administratively on the General Management. It fulfills the following main functions:

1. Coordinate the agendas of Board of Directors meetings with the General Management for consideration by the President, within the framework of the annual activity calendar, and new initiatives proposed by the Directors or the General Manager.
2. Make convocations and attend Board of Directors meetings, with the right to speak.
3. Coordinate logistical support for Board of Directors sessions.
4. Draft the minutes of the meetings for consideration by the Board of Directors and certify the correct transcription of the approved text.
5. Custody the minutes, administer the documentation and archives of the Board of Directors.
6. Legalize the minutes and resolutions of the Board of Directors.
7. Communicate the decisions of the Board of Directors by its instructions.
8. Attend to the correspondence of the Board of Directors.
9. Provide administrative support to the members of the Board of Directors.
10. Others entrusted to it by the Presidency and the Board of Directors.

Article 31.- (Designation and Removal)
The appointment of the Board of Directors Secretary is for an indefinite period, being able to be substituted by decision of the Board of Directors or for the causes established in Articles 47, 50, and 80 of Law No. 1670.

Article 32.- (Confidentiality)
The Board of Directors Secretary is obliged to keep reserve and confidentiality of all topics treated in the Board of Directors, except those that the Board of Directors decides to make known.

CHAPTER IV
ON THE PRESIDENT OF THE BANK

Article 33.- (Executive Authority)
The President of the BCB is the first executive authority of the Institution and is responsible for directing and supervising the work conducive to the formulation of policies and specialized norms of general application and definition of administrative, operational, and financial strategies of the BCB, including their respective medium and long-term programs, supervising and evaluating their execution. He will provide the Board of Directors with the information and analysis and audit services necessary for the fulfillment of its functions and will act on behalf of the Board of Directors and preside over its meetings. He will have the casting vote in case of a tie.

Article 34.- (Powers)
Within the framework of what is stated in Articles 57 to 61 of Law No. 1670, the President has the following powers:

1. Propose to the Board of Directors the policies, norms, resolutions, and measures that he deems pertinent for