Resolution 163/97 - Liquidity Loan to Banco Internacional de Desarrollo S.A. (BIDESA) — BCB — BO

BOARD RESOLUTION NO. 163/97
SUBJECT: FINANCIAL SYSTEM - LIQUIDITY LOAN TO
BANCO INTERNACIONAL DE DESARROLLO S.A.
(BIDESA) UP TO $US 5,000,000.-

SEEN:
The Law No. 1670 of the Central Bank of Bolivia (BCB) of October 31, 1995.
The Board Resolution No. 148/95 of November 23, 1995.
The Regulations to Address Transitory Liquidity Needs of the Financial System, approved by Board Resolution No. 025/94 of February 17, 1994.
The notes from the Superintendence of Banks and Financial Entities (SBEF) SB/IS1/14179, SB/IS1/14598, SB/ISB/51154 and SB/ISB/51540, of March 31, April 1, November 12 and 17, 1997, respectively. The Note FSF - E - 682/97 from FONDESIF of November 10, 1997. The notes from BIDESA GG No. 167/97 and GG No. 170/97 of November 13 and 17, 1997, respectively. The Report from the Financial System Management GSF No. 184/97 of November 17, 1997. The Report from the Legal Advisory ALEG No. 224/97 of November 17, 1997. The Minutes No. 36/97 of the Financial System Analysis Committee (COASIF) dated November 17, 1997.

CONSIDERING:
That BIDESA has requested a credit from the BCB to address transitory liquidity needs due to the decline in its deposits, and because, having exhausted all efforts within its reach, it has no other financing alternatives for the stated purpose.

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That by Resolution of November 7, 1997, FONDESIF granted BIDESA a maximum deadline until November 28, 1997, to comply with the actions and terms of the SBEF regarding its Strengthening Plan. That in Minutes No. 36/97 of November 17, 1997, the favorable opinion of the Financial System Analysis Committee (COASIF) appears for the granting of the aforementioned liquidity credit up to the amount of $US 5,000,000.- That the liquidity credit requested by BIDESA is backed primarily by a portfolio with rating 1 (normal), in a 2 to 1 proportion, thus guaranteeing the recovery of State funds. That according to the Report from the Financial System Management, the requesting entity has no pending liquidity credits to pay. That in the opinion of the Legal Advisory, there is no legal impediment to processing BIDESA's request. That Article 36 of Law 1670 of October 31, 1995, authorizes the BCB to grant liquidity credits to banks and financial intermediation entities, in duly justified cases qualified by its Board by an absolute majority of votes.

Therefore,
THE BOARD OF THE CENTRAL BANK OF BOLIVIA
RESOLVES:

Article 1.- Exceptionally grant a liquidity credit to BIDESA, in accordance with the requirements established in the Regulations to Address Transitory Liquidity Needs of the Financial System and Law 1670 of October 31, 1995, under the following conditions:
Amount: Up to the sum of $US 5,000,000.-
Currency: United States Dollars.

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Interest Rate: 16.63% annual, the average active rate of the system for 30 days, in foreign currency (United States Dollars), prevailing in the market during the week of November 4 to 7, 1997. Term: 30 days from the signing of the contract. Amortization: A single payment at maturity. Guarantees: Credit portfolio with BIDESA's own resources, primarily with rating 1 (normal) following the criteria of the Superintendence of Banks and Financial Entities. This portfolio should, as far as possible, have real guarantees, whose loans have maturities greater than 30 days and less than 360, computable from the date of disbursement of the credit, and must be fully satisfactory to the BCB. The temporary assignment of credit will be documented by means of a contract. The sum of the guarantees must be equivalent to twice the amount of the credit. Automatic debit in its current accounts and legal reserve held at the BCB.

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Article 2.- The resources will be disbursed prior to the signing of the temporary assignment contract of the portfolio and will be used exclusively to cover BIDESA's exchange deficiencies in the Clearing House. BIDESA must authorize the Clearing House to send daily to the BCB the list of checks drawn against it and photocopies thereof when required by the BCB's Accounting Management.

Article 3.- During the validity of the credit, BIDESA may not increase its loan or investment portfolio in accordance with Article 15 of the aforementioned Regulations. The BCB will request the Superintendence of Banks and Financial Entities to strictly monitor all provisions of this Resolution.

Article 4.- In view of what is provided in Article 8 of the Regulations to Address Transitory Liquidity Needs of the Financial System, BIDESA must send daily to the Central Bank of Bolivia, through the Financial System Management, the following information:
a) Current and overdue portfolio (consolidated). b) Public deposits by class of deposits (consolidated). c) Passive rates by class of deposit. d) Daily projected liquidity flow for the next 7 days comprising obligations with the public, portfolio recovery, and obligations with the exterior.

Article 5.- By November 28, 1997, BIDESA must comply with the terms and conditions established by the Superintendence of Banks and Financial

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Entities in its opinion letter SB/IS1/DOCUMENT 14179 - Procedure 46979 of March 31, 1997 or, failing that, present to the BCB a Reformulated Strengthening Plan with the opinion of the SBEF and the approval of FONDESIF. In case of non-compliance, BIDESA will not be able to access renewals of this credit or new loans.

Article 6.- Authorize the President of the BCB to sign the loan contracts and temporary assignment of portfolio contracts with BIDESA.

Article 7.- The Presidency and General Management are responsible for the execution and compliance of this Resolution.

17.XI.97

____________________ Juan Antonio Morales A.

Armando Pinell S. Jaime Ponce G.

Juan Medinacelli V. Fernando Campero P.

Juan Pablo Zegarra A.