Resolution CMN No. 3376 — Reprogramming of Overdue Installments and Extension of Future Installments in 2006 for Working Capital and Investment Financing

RESOLUTION NO. 003376

Dispenses with the reprogramming of overdue installments and the extension of future installments in 2006 of working capital and investment financing.

THE CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law 4,595 of December 31, 1964, makes public that the MONETARY COUNCIL, in an extraordinary session held on June 16, 2006, considering the provisions of Article 4, item VI, of the aforementioned law, Articles 4 and 14 of Law 4,829 of November 5, 1965, and Article 5 of Law 10,186 of February 12, 2001,

RESOLVED:

Article 1. Authorize the reprogramming of part of the outstanding balance of working capital operations, from the 2004/2005 and 2005/2006 harvests, and the extension of part of the future installments of operations due in 2006, maintaining the financial charges originally agreed upon for the normal situation, observing the following conditions:

I - beneficiaries: borrowers of working capital operations:

a) agricultural from the 2004/2005 harvest, extended under the terms of Resolution 3,314 of September 8, 2005, dispensing, in these cases, the formal request from the producer;

b) agricultural from the 2005/2006 harvest, destined for cotton, rice, cassava, corn, soy, sorghum, and wheat crops;

c) livestock, due in 2006, destined for beef and dairy cattle;

d) livestock, due in 2006, destined for poultry and swine farming explored by producers integrated with cooperatives and by independent producers not linked to integrating companies;

II - limit: up to the value corresponding to the following percentages of the outstanding balance of the operation, according to the financed activity:

a) cotton and corn: 35% (thirty-five percent);

b) rice: 50% (fifty percent);

c) cassava: 25% (twenty-five percent);

d) wheat and sorghum, beef and dairy cattle, poultry and swine farming explored by producers integrated with cooperatives and by independent producers not linked to integrating companies: 20% (twenty percent);

e) soy:

1. South and Southeast Regions: 55% (fifty-five percent);

2. other regions: 80% (eighty percent);

III - repayment of the remaining outstanding balance: within five years, with up to twelve months of grace period, counted from the original due date of the first agreed installment or, in the case of already extended operations, from the due date established in the last adjustment for the first installment, in annual, equal, and successive installments, from 2007 to 2011, allowing, exceptionally, the extension of the first installment up to December 30, 2007;

IV - guarantees: the usual ones for rural credit, which, at the discretion of the financial agent, the production linked to working capital can be replaced by other guarantees admitted in the Rural Credit Manual (MCR), through an addendum, if applicable.

§ 1. For the purposes of this article, the calculation of the outstanding balance must be performed excluding the charges agreed upon for the default situation.

§ 2. The extensions and reprogramming are conditioned on the payment of the installment that exceeds the percentages established in item II, which must occur, in the case of extension, on the originally agreed due date, without prejudice to the early formalization of the extension, at the discretion of the financial agent.

§ 3. Financial agents may admit, in accordance with MCR 2-6-9, extensions in percentages higher than those established in item II, observing the other conditions defined in this resolution.

§ 4. The producer must formalize the request:

I - in the case of extension, until the due date of the first originally agreed installment;

II - in the case of reprogramming of overdue operations and due in the months of June and July 2006, until July 31, 2006.

§ 5. Any compensation for losses due to the Agricultural Activity Guarantee Program (Proagro) will be carried by the financial institution to amortize the respective prorogated outstanding balance.

§ 6. The extensions and reprogramming referred to in this resolution must be carried out without prejudice to the observance of the provisions of Resolution 2,682 of December 21, 1999, regarding the classification and the constitution of a provision for doubtful liquidation credits of the operations in question.

Article 2. Extensions and renegotiations carried out under the auspices of Resolutions 3,363 of April 26, 2006, and 3,364 of April 26, 2006, replaced by Resolution 3,373 of June 19, 2006, are dispensed from the formal request from the producer, substituted by automatic implementation, when the benefited activity is the production of cotton, rice, corn, soy, sorghum, or wheat.

Article 3. In operations covered by Resolutions 3,363 of 2006 and 3,364 of 2006, replaced by Resolution 3,373 of 2006, prorogated interest will be collected together with the prorogated capital, not allowing proportional allocation in future installments.

Article 4. This resolution enters into force on the date of its publication.

Brasília, June 21, 2006.

Henrique de Campos Meirelles
President