Resolution No. JPRF-G-2024-0111 Approves the Budget of the National Corporation of Popular and Solidarity Finance for the 2024 Fiscal Year

Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas Governmental Financial Management Platform. Red Block, 8th floor
| Postal Code: 170507 | Quito - Ecuador |
Resolution No. JPRF-G-2024-0111
THE FINANCIAL POLICY AND REGULATION BOARD
CONSIDERING:
That, Article 226 of the Constitution of the Republic of Ecuador establishes that “state institutions, their agencies, dependencies, public servants and persons who act by virtue of a state power shall exercise only the competencies and faculties attributed to them in the Constitution and the law. They shall have the duty to coordinate actions for the fulfillment of their purposes and to make effective the enjoyment and exercise of the rights recognized in the Constitution.”; That, Article 309 of the Fundamental Norm stipulates that entities of the national financial system shall be responsible for preserving their “security, stability, transparency and solidity”; That, Article 310 of the Magna Carta orders that: “The public financial sector shall have as its purpose the sustainable, efficient, accessible and equitable provision of financial services. The credit it grants shall be oriented preferentially to increase the productivity and competitiveness of productive sectors that allow achieving the objectives of the Development Plan and of the less favored groups, in order to promote their active inclusion in the economy.”; That, Article 13 of the Organic Code of Monetary and Financial Law, Book I, created the Financial Policy and Regulation Board as part of the Executive Function, responsible for the formulation of credit, financial, securities, insurance and prepaid health care service regulation and policy; That, Article 14.1, number 14, letter a of the Organic Code of Monetary and Financial Law, Book I, states that it is a faculty of the Financial Policy and Regulation Board: “a. Annually approve the budget of the entities of the public financial sector, their reforms, as well as regulate their execution”; That, by Resolution No. JPRF-G-2022-056 of December 29, 2022, the Financial Policy and Regulation Board approved the budget for the economic exercise of the year 2023 of the National Corporation of Popular and Solidarity Finance; That, by Resolution No. JPRF-F-2024-099 of February 29, 2024, the Financial Policy and Regulation Board reformed the norm on the approval of budgets of public financial entities contained in Subsection I “Budget Management Norms for Entities of the Public Financial Sector”, Section III “Of the Public Financial Sector Capital Budget”, Chapter XXXIII “Of the Government and Administration of the Public Financial Sector”, Title II “National Financial System”, Book I “Monetary and Financial System” of the Codification of Monetary, Financial, Securities and Insurance Resolutions; That, the Sole Transitional Provision of Resolution No. JPRF-F-2024-099 establishes that, for the approval of the budget proformas corresponding to the year 2024, entities of the public financial sector must submit to the Financial Policy and Regulation Board, on this single occasion, by April 30, 2024, the budgets approved by the corresponding government and administration bodies; That, by Letter No. CONAFIPS-CONAFIPS-2024-0163-OFI of February
22, 2024, the General Manager of the National Corporation of Popular and Solidarity Finance submits to the Financial Policy and Regulation Board “the report of the Budget Proforma of the National Corporation of Popular and Solidarity Finance corresponding to the 2024 Economic Exercise and multiannual budget ceilings (…)”;

Resolution No. JPRF-G-2024-0111

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Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas Governmental Financial Management Platform. Red Block, 8th floor
| Postal Code: 170507 | Quito - Ecuador |
That, the Acting Technical Secretary of the Financial Policy and Regulation Board, through Memorandum No. JPRF-ST-2024-0070-M of June 21, 2024, submits to the President of the Board the Technical Report No. JPRF-CTIFSP-2024-0010 of June 19, 2024 and the Legal Report No. JPRF-CJF-2024-029 of June 20, 2024, as well as the respective draft resolution; That, the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on June 21, 2024 and carried out via video conference on June 24, 2024, reviewed the Memorandum No. JPRF-ST-2024-0070-M of June 21, 2024, issued by the Acting Technical Secretary of the Board; as well as the Technical Report No. JPRF-CTIFSP-2024-0010 of June 19, 2024 and the Legal Report No. JPRF-CJF-2024-029 of June 20, 2024, issued by the Technical Coordination of Policy and Regulation of Financial Inclusion and Prepaid Health and by the Legal Coordination of Policy and Financial Norms, and the corresponding draft resolution; That, the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on June 21, 2024 and carried out via video conference on June 24, 2024, reviewed and approved the following Resolution; and, In exercise of its functions, RESOLVES:
SINGLE ARTICLE.- Approve the budget of the National Corporation of Popular and Solidarity Finance for the economic exercise of the year 2024, which covers from January 1, 2024 to December 31, 2024, under the terms indicated by the General Manager in Letter No. CONAFIPS-CONAFIPS-2024-0163-OFI of February 22, 2024, which are derived from the Annex that forms part of this Resolution. GENERAL PROVISIONS FIRST.- The National Corporation of Popular and Solidarity Finance must comply with what is established in Article 13 of the “Budget Management Norm for Entities of the Public Financial Sector”, of Section III “Of the Public Financial Sector Capital Budget”, of Chapter XXXIII “Of the Government and Administration of the Public Financial Sector”, of Title II “National Financial System”, of Book I “Monetary and Financial System” of the Codification of Monetary, Financial, Securities and Insurance Resolutions, regarding the control of budget execution, highlighting the need to monitor funding sources, loan placement and recovery targets, earned commissions, operating expenses, intermediation margin and the exercise result projected by the entity for 2024. SECOND.- It is ordered that the National Corporation of Popular and Solidarity Finance submit the approved budget for the economic exercise of the year 2024 to the Ministry of Economy and Finance and to the National Assembly within a term of 30 days, counted from the issuance of this Resolution, in compliance with what is provided in articles 112 of the Organic Code of Public Planning and Public Finance and 94 of its General Regulation. FINAL PROVISION.- This Resolution shall enter into force from the present date, without prejudice to its publication in the Official Register, and shall be published on the institutional website of the Financial Policy and Regulation Board within a maximum term of two days from its issuance.

Resolution No. JPRF-G-2024-0111

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Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas Governmental Financial Management Platform. Red Block, 8th floor
| Postal Code: 170507 | Quito - Ecuador |
NOTIFY.- Given in the Metropolitan District of Quito, on June 24, 2024.
THE PRESIDENT,
Mgs. María Paulina Vela Zambrano
The preceding Resolution was processed and signed by Master María Paulina Vela Zambrano, President of the Financial Policy and Regulation Board, in the Metropolitan District of Quito, on June 24, 2024.- I CERTIFY.
ACTING TECHNICAL SECRETARY
Mgs. Luis Alfredo Olivares Murillo

Resolution No. JPRF-G-2024-0111

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Address: Av. Amazonas between Pereira and Unión Nacional de Periodistas Governmental Financial Management Platform. Red Block, 8th floor
| Postal Code: 170507 | Quito - Ecuador |
ANNEX
Institutional Budget of the National Corporation of Popular and Solidarity Finance for the 2024 Economic Exercise In dollars Source: CONAFIPS

CONCEPT	BUDGET EXECUTED 2019	BUDGET EXECUTED 2020	BUDGET EXECUTED 2021	BUDGET APPROVED 2023	BUDGET EXECUTED 2023	PROFORMA 2024	VARIATIONS PROFORMA 2024 vs Budget codified 2023	BUDGET CODIFIED 2023	BUDGET EXECUTED 2022
I. ADMINISTRATIVE BUDGET
ORDINARY BUDGET
INCOME	15,878,090	18,953,647	21,002,677	25,009,804	35,303,385	35,303,385	31,101,611	41,005,606	5,702,221	16%
Credit Interest	14,766,553	18,034,026	19,293,741	23,027,729	32,527,498	32,527,498	29,548,857	39,169,010	6,641,512	20%
Interest on Financial Investments	-	323,137	803,753	1,083,415	1,957,312	1,957,312	873,881	1,353,108	(604,205)	-31%
Other Earned Interest	51,249	40,643	31,926	15,426	28,900	28,900	6,020	26,000	(2,900)	-10%
Earned Commissions	601,730	483,347	778,895	867,203	755,175	755,175	605,830	434,100	(321,075)	-43%
FOGEPS Commission	249,112	389,394	443,113	342,855	342,855	165,589	69,280	(273,575)	-80%
FIDUCIA Commissions	234,235	389,501	424,090	412,320	412,320	440,241	364,820	(47,500)	-12%
Other Ordinary Income	458,558	72,494	94,362	16,032	34,500	34,500	67,023	23,388	(11,112)	-32%
EXPENSES	7,081,859	8,265,931	10,070,583	16,625,503	32,766,087	32,661,580	22,181,886	36,570,934	3,909,353	12%
Interest on Obligations	2,302,909	4,359,264	4,338,324	11,257,514	23,958,323	23,958,323	15,657,872	28,575,427	4,617,105	19%
Interest on Deposits	1,013	7,421	7,478	-	-	-	-	-	-	-
Incurred Commissions	64,874	17,463	712,267	35,126	1,559,583	1,366,357	762,018	725,200	(641,157)	-47%
Personnel Expenses	3,277,444	2,965,507	3,467,468	3,853,562	4,974,117	5,091,911	4,149,808	5,056,922	(34,989)	-1%
Remuneration	2,334,759	2,192,215	2,562,115	2,821,788	3,388,684	3,394,684	2,971,010	3,292,132	(102,552)	-3%
Social Benefits and Contributions	719,010	726,255	789,674	887,552	1,118,296	1,207,483	943,488	1,190,048	(17,435)	-1%
Other Personnel Expenses	223,675	47,036	115,679	144,223	467,137	489,744	235,310	574,742	84,998	17%
Operating Expenses	1,155,012	883,989	1,317,426	1,259,703	1,961,162	1,919,177	1,432,105	1,932,452	13,275	1%
Fees	257,626	316,134	367,705	77,869	257,563	268,633	163,586	394,469	125,836	47%
Professional Services Fees	208,230	234,878	95,961	4,072	60,723	93,282	58,891	72,352	(20,930)	-22%
Consulting Fees	49,395	81,256	271,743	73,797	196,840	175,351	104,695	322,117	146,767	84%
Various Services	751,821	438,856	814,155	977,243	1,397,811	1,279,720	980,997	1,218,144	(61,576)	-5%
Taxes	66,207	94,071	93,625	185,520	224,643	268,645	197,212	247,056	(21,589)	-8%
Other Expenses	79,359	34,928	41,942	19,070	81,144	102,180	90,310	72,783	(29,397)	-29%
Purchases and Acquisitions	280,606	32,288	227,620	219,599	312,902	325,813	180,083	280,932	(44,880)	-14%
ORDINARY SURPLUS (+)/DEFICIT (-)	8,796,231	10,687,716	10,932,094	8,384,301	2,537,299	2,641,805	8,919,725	4,434,672	1,792,867	68%
EXTRAORDINARY BUDGET
INCOME	-	398,629	103,700	351,040	358,800	358,800	74,670	240,000	(118,800)	-33%
Other Income	-	398,629	103,700	351,040	358,800	358,800	74,670	240,000	(118,800)	-33%
EXPENSES	-	20,000	30,131	129,039	217,200	217,200	-	182,405	(34,795)	-16%
Compensation - Indemnities	-	-	-	129,039	150,000	150,000	-	100,000	(50,000)	-33%
Other Expenses	-	20,000	30,131	-	67,200	67,200	-	82,405	15,205	23%
EXTRAORDINARY SURPLUS (+)/DEFICIT (-)	-	378,629	73,568	222,001	141,600	141,600	74,670	57,595	(84,005)	-59%
ADMINISTRATIVE INCOME	25,360,844	35,662,185	35,662,185	31,176,281	41,245,606	5,583,421	(0)
ADMINISTRATIVE EXPENSES	16,754,542	32,983,287	32,878,780	22,181,886	36,753,339	3,874,559	(0)
ADMINISTRATIVE SURPLUS (+)/DEFICIT (-)	8,796,231	11,066,346	11,005,662	8,606,302	2,678,899	2,783,405	8,994,395	4,492,267	1,708,862	61%
II. POLICY BUDGET
INCOME	234,463,285	433,366,560	439,749,459	533,743,039	588,697,477	586,096,191	500,898,160	477,307,609	(108,788,582)	-19%
Portfolio Recovery	136,702,234	177,810,731	220,971,339	232,685,462	222,406,324	222,406,324	245,259,911	244,808,858	22,402,534	10%
Recovery of Financial Investments	-	48,028,770	66,000,000	51,813,700	60,000,000	60,000,000	17,442,042	25,000,000	(35,000,000)	-58%
Funding - Financial Obligations / Securities in Circulation	59,000,000	134,829,168	30,000,000	122,000,000	176,000,000	176,000,000	167,101,740	110,500,000	(65,500,000)	-37%
Deposits - Administered Funds	-	268,055	283,811	-	8,629,500	8,629,500	-	-	(8,629,500)	-
Recovery of Accounts Receivable	30,394	562,811	5,582,224	-	-	-	-	-	-	-
Available Funds	38,730,657	71,867,023	122,494,308	121,661,653	121,661,653	119,060,367	71,094,468	96,998,751	(22,061,616)	-19%
Project Allocation	-	-	-	-	-	-	-	-	-	-
Recovery of Commissions	-	-	-	-	-	-	-	-	-	-
EXPENSES	238,868,552	350,930,944	410,545,900	461,377,083	498,069,006	500,670,292	457,562,520	375,966,812	(124,703,480)	-25%
Credit Portfolio Placement	201,845,078	213,244,628	268,566,798	310,905,497	304,500,000	304,500,000	307,084,335	320,000,000	15,500,000	5%
Placement in Investments	50,274,000	81,450,000	49,435,000	60,000,000	60,000,000	39,551,157	25,000,000	(35,000,000)	-58%
Administered Funds	2,356,122	142,927	372,675	-	9,181,441	9,181,441	8,938,177	-	(9,181,441)	-
Amortization of Financial Obligations / Securities in Circulation	34,044,316	82,818,452	58,565,476	92,318,452	112,380,952	112,380,952	87,380,952	24,630,952	(87,750,000)	-78%
Maturity of Deposits	523,035	279,000	283,811	-	-	-	-	-	-	-
Profit Distribution	100,000	4,171,936	1,307,139	8,718,134	12,006,613	14,607,899	14,607,899	6,335,860	(8,272,039)	-57%
Returns	-	-	-	-	-	-	-	-	-	-
POLICY SURPLUS (+)/DEFICIT (-)	(4,405,267)	82,435,616	29,203,559	72,365,955	90,628,471	85,425,899	43,335,640	101,340,797	15,914,898	19%
III. GLOBAL SURPLUS (+)/DEFICIT (-) (I+II)	4,390,964	93,501,962	40,209,222	80,972,257	93,307,370	88,209,304	52,330,035	105,833,064	17,623,760	20%
TOTAL INCOME	250,341,375	452,718,836	460,855,835	559,103,883	624,359,662	621,758,377	532,074,441	518,553,215	(103,205,161)	-17%
TOTAL EXPENSES	245,950,411	359,216,874	420,646,614	478,131,626	531,052,293	533,549,072	479,744,406	412,720,151	(120,828,921)	-23%