Resolution 132/97 Approving Transfer of IDA-2134/BO Line to NAFIBO SAM

RESOLUTION OF THE BOARD OF DIRECTORS NO. 132/97

SUBJECT: FINANCIAL SYSTEM - APPROVES TRANSFER OF THE IDA-2134/BO LINE IN FAVOR OF NAFIBO SAM, THROUGH ASSIGNMENT OF PORTFOLIO FOR VALUE.

HAVING SEEN:

Law 1670 of October 31, 1995.

The Credit Agreement IDA-2134/BO for SDRs 12,500,000, signed between the Republic of Bolivia and the IDA on August 22, 1990, and its amendments dated September 12, 1991, January 11, 1994, March 22, 1994, July 27, 1995, May 14, 1996, and April 8, 1997.

The Subsidiary Agreement for SDRs 12,500,000, signed between the Republic of Bolivia and the BCB on May 16, 1991, and the amendments dated October 13, 1994, and March 12, 1997.

Note SIPFE/SFE/NEG/2481/97 from the National Secretariat of Public Investment and External Financing of the Ministry of Finance, dated July 17, 1997.

Report from the Financial System Management SEL No. 127/97 dated July 28, 1997.

Report from the Legal Advisory ALEG No. 101/97 dated July 29, 1997.

CONSIDERING:

That Article 85 of Law 1670 establishes that the Board of Directors of the BCB will determine the dates and amounts in which the assets generated by the resources administered by the former Development Management of the Issuing Institute will be transferred in favor of NAFIBO SAM, agreeing with the latter on the value and form of payment.

That the Credit Line IDA-2134/BO, arising from the credit agreement signed between the Republic of Bolivia and the IDA on August 22, 1990, transferred for administration to the BCB through a Subsidiary Contract dated May 16, 1991, has an outstanding credit portfolio pending recovery of $152,391.72 in principal, placed in six banks and ten sub-borrowers, in addition to a delinquent portfolio amounting to $55,122.49.

That with the prior consent of the Boliviana Nacional Financiera SAM, the BCB, and the National Secretariat of Finance, with notification to the IDA, they have agreed to close the credit component of the IDA-2134/BO Line executed by the BCB, transferring its portfolio in favor of NAFIBO SAM under the modality of credit assignment for value, with the consent of the debtors.

That the Report from the Financial System Management SEL No. 127/97 establishes that the transfer amount amounts to $152,391.72, for the concept of principal balance, and NAFIBO SAM must additionally pay to the BCB the interest accrued up to the payment date. The BCB must, in turn, transfer to the Republic of Bolivia the amount owed for the balances of this Line, thereby being released from all present and future obligations for this concept, both with the Republic of Bolivia and with the IDA.

That the Report from the Legal Advisory ALEG No. 101/97 states that there is no legal impediment to making the portfolio transfer through credit assignment, that the IDA has been communicated by the Ministry of Finance, and that the Contract involves the Republic of Bolivia, represented by the National Secretary of Finance, NAFIBO SAM, and the BCB.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Approve the transfer of the IDA-2134/BO Line in favor of NAFIBO SAM, under the following terms and conditions:

Modality: Portfolio Assignment, with acceptance by the debtors, for value. Amount: $152,391.72 Interest: Those accrued up to the date of the operation, which will be paid by NAFIBO SAM on the date of signing the Portfolio Assignment Contract. Effects: With the amount paid by NAFIBO SAM and the recovered balance, the Central Bank of Bolivia will in turn pay the debt to the Republic of Bolivia for the IDA-2134/BO Line, leaving the BCB released from all present and future responsibility for this concept, both with the Republic of Bolivia and with the IDA. Treatment of the delinquent portfolio: In consideration that the BCB included the delinquent portfolio of the IDA-2134/BO line in the claim of credits presented to the Liquidation Intendencies, the administration of this portfolio will remain under the charge of the BCB. Recoveries from this portfolio will be transferred to the TGN immediately after being made.

Article 2.- Authorize the President of the BCB to sign the respective credit assignment contract for the IDA-2134/BO Line with the Republic of Bolivia, represented by the Ministry of Finance, and with NAFIBO SAM.

Article 3.- The Presidency and General Management are responsible for the execution and compliance of this Resolution.

29.VII.97

____________________ Juan Antonio Morales A.

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Armando Pinell S. Jaime Ponce G. Juan Medinacelli V.

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Fernando Campero P. Edgar Millares A.