Resolution 196/2004

RESOLUTION OF THE BOARD OF DIRECTORS NO. 196/2004

SUBJECT: MONETARY OPERATIONS MANAGEMENT – GRANTS CREDIT TO THE GENERAL TREASURY OF THE NATION TO MEET TEMPORARY LIQUIDITY NEEDS OF Bs143,000,000.

HAVING SEEN:

Law No. 1670 of October 31, 1995.

Board of Directors Resolution No. 160/97 of October 21, 1997, which approves the Regulations for Credits to the Public Sector.

Board of Directors Resolution No. 121/2001 of November 29, 2001, which modifies Article 10 of Board of Directors Resolution 160/97 regarding the Financial Conditions of Credits to the Public Sector.

Board of Directors Resolution No. 153/2004 of October 8, 2004.

The Memorandum of Understanding signed between the BCB and the Ministry of Finance on December 4, 2003.

The Addendum to the Memorandum of Understanding, dated April 1, 2004.

The Private Contract SANO No. 169/2004 of October 11, 2004.

The note from the Ministry of Finance D.G.C.P. 05-016 D.D.I. OF. No. 3109/04 of November 30, 2004.

The Report from the Monetary Operations Management SOSP 071/2004 of December 17, 2004.

The Report from the Economic Policy Advisory APEC-SMyF 062/2004 of December 20, 2004.

The Report from the Legal Affairs Management SANO No. 340/2004 of December 15, 2004.

CONSIDERING:

That the Ministry of Finance, through note DGCP 05-016 D.D.I. OF. No. 3109/04, has requested the renewal of a credit of Bs143,000,000 to meet temporary liquidity needs.

That the Monetary Operations Management, in accordance with Article 5 of the Regulations for Credits to the Public Sector, has issued Report SOSP 071/2004, which recommends the conditions under which the credit requested by the Ministry of Finance should be subject.

That the Economic Policy Advisory in Report APEC-SMyF-062/2004, states that it is appropriate for the Board of Directors to consider the first renewal of the Liquidity Credit for Bs143.0 million with a maturity date of January 7, 2005, for a term of 90 days, considering that said credit is granted within the framework of the Memorandum of Understanding and its renewal does not modify the balance of the portfolio of said credits.

That the Legal Affairs Management, in its Report SANO No. 340/2004, establishes that there is no legal impediment for the Board of Directors of the Issuing Entity to consider the renewal of a credit to the TGN for an amount of Bs143,000,000, requested by the Ministry of Finance, through note D.G.C.P. 05-016 D.D.I. OF. No. 3109/04, prior to compliance with what is established in the Regulations for Credits to the Public Sector and subsection A) of Article I of the Memorandum of Understanding.

THEREFORE,

THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA

RESOLVES:

Article 1.- Approve the first renewal of a credit to the Ministry of Finance for the attention of temporary liquidity needs, with the following conditions:

Amount: Bs143,000,000. Interest Rate: 7.20% Term: 87 days Renewal Date: January 7, 2005 Maturity Date: April 4, 2005 Guarantee Instrument: Treasury Letters “C”. Disbursement Method: In accounts of the General Treasury of the Nation, according to written request.

Payment Method: Interest and principal, through automatic debit in the current fiscal accounts that the General Treasury of the Nation holds at the Central Bank of Bolivia.

Article 2.- Authorize the President of the Central Bank of Bolivia to sign the respective contracts with the Ministry of Finance.

Article 3.- The General Treasury of the Nation may effect the total or partial early cancellation of the credit considering the accrued interests on the total of the credit up to the date of early cancellation.

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

La Paz, December 21, 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 V. Fernando Paz B.