Resolution CMN No. 3579 — Provides for the individualization of Pronaf-backed rural credit operations, liquidation and renegotiation of Procera-backed operations, and amends Resolution No. 3,407 of September 27, 2006

RESOLUTION NO. 003579

Provides for the individualization of rural credit operations backed by Pronaf, liquidation and renegotiation of operations backed by Procera, and amends Resolution No. 3,407 of September 27, 2006.

The CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the MONETARY NATIONAL COUNCIL, in a session held on May 29, 2008, based on the provisions of Articles 4, item VI, of the aforementioned Law, 4 and 14 of Law No. 4,829 of November 5, 1965, 5 of Law No. 10,186 of February 12, 2001, and 10 and 18 of Law No. 11,322 of July 13, 2006, and 41 of Provisional Measure No. 432 of May 27, 2008,

RESOLVES:

Art. 1 The individualization of the rural credit operations referred to in Article 21 of Provisional Measure No. 432 of May 27, 2008, formalized until June 30, 2006, including those contracted by cooperatives and associations of rural producers, effected with guarantee, with co-obligors, or contracted collectively or in groups, under the National Program for Strengthening Family Agriculture (Pronaf), with beneficiaries classified in Groups "A", "A/C" and "B", including those carried out with resources from the Worker Support Fund (FAT), the General Budget of the Union, or the Constitutional Financing Funds for the North, Northeast, and Center-West, with risk borne by the Union or the respective Constitutional Funds, must observe the following conditions:

I - borrowers must formalize with financial institutions the request for individualization of the operations referred to in the caput until September 30, 2008;

II - financial institutions must:

a) formalize the respective instruments of individualization and assumption of debts until December 31, 2008;

b) promote, among other measures, the cancellation of the corresponding value, calculated by the participation of each beneficiary in the contract with guarantee, with co-obligors, or concluded collectively or in groups, in the original credit instrument, making reference to the new credit document;

III - the provisions of Articles 2, caput, and 3, caput and § 1, of Law No. 10,186 of February 12, 2001, apply to the individualized operations, maintaining, if still existing, the original real guarantee originally linked to the contract with guarantee, collective or group, when all borrowers opt for individualization;

IV - in the case where all borrowers opt for the individualization of a contract whose existing real guarantee is constituted by financed property and that property is:

a) indivisible, the debt may be individualized, maintaining the financed property as guarantee in all individualized contracts;

b) divisible, the debt may be individualized with the concomitant individualization of the guarantee;

V - in cases where at least one of the borrowers belonging to a collective or group contract does not opt for individualization:

a) the financial institution is authorized to contract with a cooperative or association, from whose social body the borrowers participate, an operation for the assumption of the remaining debt, maintaining, if any, the guarantee originally linked to the collective or group contract, for the purpose of ensuring that the guaranteed property continues to serve the rural activities of the farmers;

b) in the event of the execution of the guarantee linked to the contract with guarantee, with co-obligors, or concluded collectively or in groups, any surplus of resources, after the obligations of the defaulting borrowers are settled, shall be proportionally allocated to the amortization of the compliant operations, and such circumstance must appear in the credit contract of the individualized debt;

c) in accordance with Articles 282 to 284 of Law No. 10,406 of January 10, 2002, upon effecting the individualization of the operation, the borrower shall be liable only for the portion of the debt assigned to him, exonerating himself from the joint obligation towards the other debtors, and the financial institution must waive the contractual solidarity of the credit with respect to all borrowers, including those who do not opt for individualization;

d) the credit instruments representing the individualization may be formalized without the requirement of other guarantees beyond the personal obligation of the debtor;

e) the exclusion of suretyship guarantees is authorized in operations formalized under Groups "A", "A/C" and "B" of Pronaf that were contracted individually;

VI - for Pronaf Group "A" operations intended for advanced operating costs, which meet the criteria established for individualization, the following treatment must be given:

a) when it concerns an investment credit with provision for the use of resources for associated operating costs, the value of the portion intended for advanced operating costs may be incorporated into the outstanding balance of the investment operations, applying the conditions provided in Article 17 of Provisional Measure No. 432 of 2008, for Group "A";

b) in the case of an isolated advanced operating cost operation, the conditions provided in Article 18 of Provisional Measure No. 432 of 2008 must be adopted for the "A/C" group of Pronaf;

VII - the individualization of Pronaf operations, Groups "A", "A/C" and "B", shall be effected by the outstanding balance of the operations, calculated under the conditions established in Articles 17, 18, and 16 of Provisional Measure No. 432 of 2008, respectively.

Sole Paragraph. The individualized operations based on this article may be regularized or liquidated under the conditions of Articles 16, 17, and 18 of Provisional Measure No. 432 of 2008, respectively, respecting the deadlines established for these measures.

Art. 2 To operations backed by the Special Credit Program for Agrarian Reform - Procera, referred to in Article 23 of Provisional Measure No. 432 of 2008, restructured or not based on Law No. 10,696 of July 2, 2003, the following deadlines apply:

I - until September 30, 2008, for borrowers to manifest interest in the liquidation of the operations under items I to III of Article 23 of Provisional Measure No. 432 of 2008, or for renegotiation under item IV of the same article;

II - until December 31, 2008, for the formalization of the renegotiation, including the liquidation of the operation or the minimum amortization required of the borrower as a condition for the renegotiation of their debts;

III - until December 30, 2009, and December 30, 2010, for the liquidation of the operation under the conditions established in item II of Provisional Measure No. 432 of 2008, as applicable and provided that the operation is compliant on the date of liquidation.

Art. 3 In view of the alterations in Article 2 of Law No. 11,322 of July 13, 2006, introduced by Article 27 of Provisional Measure No. 432 of 2008, Articles 2, 3, 4, 7, and 10 of Resolution No. 3,407 of September 27, 2006, shall enter into force with the following wording:

"Art. 2 To qualify for renegotiation, the borrower must formally manifest his interest to the financial agent until September 30, 2008.

Art. 3 It is incumbent upon financial agents:

I - to formalize, until December 30, 2008, the extensions and restructuring of debts;

II - to provide to the Ministries of Finance and National Integration:

a) until March 30, 2009, all information regarding the contracts referred to in this Resolution;
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Art. 4.........................................................

II - the operations extended or renegotiated under the aegis of Law No. 9,138 of November 29, 1995, or Resolution No. 2,471 of February 26, 1998, of the Monetary National Council, and their amendments.

Sole Paragraph. The renegotiation conditions referred to in this Resolution may be applied to borrowers of operations renegotiated based on Resolution No. 2,765 of August 10, 2000, or subsequent legislation, provided there is no cumulation of the benefits now established, including rebate, payment term, grace period, interest rate, and compliance bonus, with those obtained in previous restructurings, allowing a new renegotiation only to complement benefits that prove more advantageous to the borrowers.
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Art. 7....................................................

IV - ......................................................

c).........................................................

4. term from the restructuring: ten years, with the first installment due on October 31, 2008.
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Art. 10 ...................................................

IV - ......................................................

b) ........................................................

3. term: ten years, with the first installment due on October 31, 2008;
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c) ........................................................

4. term from the restructuring: ten years, with the first installment due on October 31, 2008;
   ....................................................." (NR)

Art. 4 Rural producers who have committed credit diversion are not beneficiaries of the measures established in this Resolution.

Art. 5 This Resolution enters into force on the date of its publication.

Art. 6 Resolution No. 3,405 of September 22, 2006, is hereby revoked.

Brasília, May 29, 2008.

Henrique de Campos Meirelles
President