Resolution Reforming Articles 3, 18, 20 and 21 and Adding Annex III to the Standard on Public Offering of Securities in the Primary Market

Resolution No. CD-SIBOIF-799-1-SEP20-2013
Dated September 20, 2013

STANDARD REFORMING ARTICLES 3, 18, 20 AND 21 AND ADDITION OF ANNEX TO THE STANDARD ON PUBLIC OFFERING OF SECURITIES IN THE PRIMARY MARKET

The Board of Directors of the Superintendence of Banks and Other Financial Institutions,

CONSIDERING

I

That Article 20 of Law No. 587, "Capital Markets Law," published in La Gaceta, Official Journal No. 222, of November 15, 2006, establishes that the Superintendent may exempt, totally or partially, from compliance with the requirements established in this Law, certain subscription or sale offerings of securities, based on the condition of the issuer or the nature of the operation, the small amount of securities offered, the restricted number of acquirers thereof, or the specific qualification by which they are called to participate in the offering. Likewise, said article establishes that the Board of Directors of the Superintendence of Banks and Other Financial Institutions may issue general standards for these purposes.

II

That although Article 18 of the Standard on Public Offering of Securities in the Primary Market, contained in Resolution No. CD-SIBOIF-692-1-SEP7-2011, published in La Gaceta, Official Journal No. 210, of November 7, 2011, already establishes the requirements for the registration of debt securities issuances for public offering, it is necessary to clarify what information provided in said article will not be required from supervised entities requesting to register this type of issuance, in view that the same is already in the possession of the Superintendence.

In exercise of its powers,

HAS ISSUED

The following:

Resolution No. CD-SIBOIF-799-1-SEP20-2013
STANDARD REFORMING ARTICLES 3, 18, 20 AND 21 AND ADDITION OF ANNEX TO THE STANDARD ON PUBLIC OFFERING OF SECURITIES IN THE PRIMARY MARKET

FIRST: Articles 3, 18, 20 and 21 of the Standard on Public Offering of Securities in the Primary Market, contained in Resolution No. CD-SIBOIF-692-1-SEP7-2011, published in La Gaceta, Official Journal No. 210, of November 7, 2011, are reformed, which shall read as follows:

"Article 3. Concepts.- For the purposes of this standard, the following are understood:

a. ISIN Code (International Securities Identification Number): International coding system that allows the identification of securities issuances.

b. Financial Institutions: Banks and financial companies, subject to the supervision of the Superintendence of Banks and Other Financial Institutions.

c. Group of economic interest: Related parties, significant linkages and indirect manifestations of the issuer, referred to in Article 55 of Law 561, General Law of Banks, Non-Bank Financial Institutions and Financial Groups, and the regulations governing the matter on concentration limits.

d. Institutional Investor: Banks, financial companies, insurance companies, stock market intermediaries, investment funds, pension funds, regional banks, international organizations, legal entities with assets equal to or greater than the equivalent in national currency of three million United States dollars, among others.

e. Sophisticated Investor: Natural person who qualifies in any of the following situations:

1. Having net worth equal to or greater than the equivalent in national currency of five hundred thousand United States dollars.

2. Having liquid assets or investments in financial instruments in an amount equal to or greater than the equivalent in national currency to two hundred fifty thousand United States dollars.

3. Having an annual gross income equal to or greater than the equivalent in national currency of one hundred fifty thousand United States dollars, for each of the two previous years and with the expectation of generating equal or greater income for the current year.

f. Law No. 477: General Public Debt Law, published in La Gaceta, Official Journal Number 236, of December 12, 2003.

g. Capital Markets Law: Law No. 587, Capital Markets Law, published in La Gaceta, Official Journal, No. 222 of November 15, 2006.

h. Ticker: Name, abbreviation or symbol assigned by the stock exchange to the instrument representing a company that trades its shares on the exchange.

i. Superintendence: Superintendence of Banks and Other Financial Institutions.

j. Superintendent: Superintendent of Banks and Other Financial Institutions.

Article 18. Requirements for registration.- The registration of debt securities issuances for public offering shall be subject to the presentation of the following minimum documentation and information:

a. Registration request.

b. Prospectus, in accordance with what is established in Article 19 of this standard and Annex I, which is an integral part thereof. In the case of financial institutions, they may present a simplified prospectus in accordance with the minimum content established in Annex III of this standard, which is an integral part thereof.

c. Risk rating in accordance with what is established in the Capital Markets Law and the regulations governing this matter.

d. Financial information in accordance with what is provided in Article 20 of this standard and what is established in Annex I. In the case of financial institutions, they shall be exempt from presenting the balance sheet, income statement, and financial ratios; however, in the simplified prospectus established in Annex III of this standard, they must expressly indicate that such information is available to the public on their Website and on that of the Superintendence. Likewise, they shall be exempt from presenting their projected cash flow for the next year and actual annual cash flow.

e. Legal and administrative documentation, in accordance with what is established in Article 21 of this standard. The notarial certifications presented as part of the legal documentation shall not be older than three months with respect to the date of presentation of the request and must expressly indicate that the content and terms of the documents being certified remain in force on the date of their issuance.

f. Information and documentation regarding guarantees, when applicable, in accordance with what is established in Article 22 of this standard.

The issuer must have a paying agent. Information about the paying agent shall be stated in the prospectus.

The requirement indicated in letter b. may be presented in draft form together with the registration request; however, once the authorization resolution is issued, it must be presented in original form in accordance with what is provided in Article 38 of this standard.

Article 20. Financial information.- The following minimum financial information must be presented:

a. Consolidated audited financial statements of the issuer and its controlling company, when applicable, for the last three completed fiscal periods and interim quarterly for the current fiscal period, the last period with an age not greater than two months prior to the authorization request. The issuer's financial statements must be presented, insofar as applicable, in accordance with the regulations governing external audits issued by the Board of Directors of the Superintendence. In the case of financial institutions, they shall only present the consolidated audited financial statements of the issuer and its controlling company, when applicable, for the last fiscal period and interim quarterly for the current fiscal period, the last period with an age not greater than two months prior to the authorization request.

b. Financial ratios in accordance with Annex I.

c. Cash flow for the next projected year with the assumptions used and the issuer's actual annual cash flow.

Issuing entities that, by the date of their constitution, do not have the financial information required for the periods indicated, must present financial projections, as well as the assumptions supporting them, all in accordance with the provisions established by the Superintendent. These issuances may only be registered for restricted public offering. Once they have the actual audited information for the required periods, they may opt for new unrestricted public offerings.

Issuers domiciled abroad may present their financial statements based on the accounting standards applicable in their country of origin; in this case, a report prepared by external auditors on the main differences between said standards and the accounting standards applicable in the country must be attached, as well as their impact on the main accounts of the financial statements. This last requirement is exempted for issuers whose issuance is directed to restricted public offering.

Article 21. Legal and administrative documentation.- The following minimum legal and administrative information must be presented:

a. Notarial certification of the board of directors meeting minutes or general shareholders' assembly meeting minutes that agreed on the issuance of the securities as appropriate according to the articles of incorporation and bylaws. This certification must include the precise indication of the amount and conditions of the issuance. Likewise, in the case of issuance programs, the certification must include the decision to proceed with the registration of the program, with the indication of the global amount and its revolving nature, in the case of short-term debt issuance programs.

b. Notarial or registry certification of the powers granted to the legal representatives of the company who will act before the Superintendence and where their conditions are stated. In the case of financial institutions, they shall be exempt from presenting this information.

c. Notarial declaration made by the legal representative of the issuing company, whereby they guarantee the truthfulness and sufficiency of all information provided and regarding the content of the prospectus based on a due diligence process in the terms set forth in Article 15 of the Capital Markets Law and that compliance with the regulations governing the matter on corporate governance of public offering securities issuers is met.

d. Public offering notice to be published once the issuance is authorized, in accordance with the format established in Annex II, which is an integral part of this standard. This requirement is exempted for issuances registered for restricted public offering, the renewal of issuances, and the registration of capital increases of stock issuances registered. In these cases, a Relevant Fact Communication must be made in the terms determined by the Superintendent.

e. In the case that a placement contract is signed, the legal representative of the placing entity must make an express declaration that a due diligence process was carried out on the information provided by the issuer, in accordance with the terms established in Article 15 of the Capital Markets Law.

f. Description of any pending legal litigation, in which the issuer or any of its subsidiaries is a party (excluding from this description routine litigations, incidental to the ordinary course of business). Reference must be made to the court, tribunal, arbitration center, or administrative entity where the process is filed, start date, main parties, description of the facts, as well as the claim sought. Any legal litigation in which its shareholders, directors, and main officials are parties must also be described.

The notarial declarations referred to in this article may be presented in draft form together with the registration request; however, once the authorization resolution is issued, they must be presented in original form and made before a public notary in accordance with what is provided in Article 38 of this standard."

SECOND: Annex III is added to the Standard on Public Offering of Securities in the Primary Market, contained in Resolution No. CD-SIBOIF-692-1-SEP7-2011, published in La Gaceta, Official Journal No. 210, of November 7, 2011, which shall read as follows:

ANNEX III
MINIMUM CONTENT OF THE SIMPLIFIED PROSPECTUS

a. Cover
Include as a title the word SIMPLIFIED PROSPECTUS and at minimum:

• Legal and trade name of the issuing financial institution.
• Quantity, type, and total amount of the issuances.
• In the case of issuance programs, the global amount of the program.
• Date and number of the public offering authorization resolution.
• Representative stock exchange broker.
• Incorporate the following legend: "The authorization to conduct a public offering does not imply qualification on the issuance, nor the solvency of the issuer or intermediary."
• Date of preparation of the simplified prospectus.
• Add a note in bold indicating the following: "The funds raised by the placement of these securities are not deposits, and consequently are not covered by the guarantee established in the Deposit Guarantee System Law, Law No. 551 published in Gaceta No. 168 of 2005."

b. Back Cover

• Include as a title "IMPORTANT NOTES FOR THE INVESTOR" and subsequently what is provided for this section in Annex I of this standard.

c. Index

• Indicate by page number in the index the content of the prospectus.

d.1. Information on the issuances and the offering

• Incorporate in table format the characteristics of each issuance in a summary table that includes, at least, the description of the main characteristics in accordance with what is provided in subsection d.1.1 of Annex I of this standard.

d.2 Additionally incorporate:

• Reasons for the offering and the use of resources from the fundraising.
  Indicate the amounts and sources of other resources required if the estimated funds are not sufficient to cover all projected purposes. Indicate, for example, if all or a substantial part of the funds received from the sale of securities will be destined to amortize debt, identify the creditors, amount, and maturity of the debt.
• Tax treatment.
• In the case of issuance programs, indication that the program will be composed of several issuances, whose characteristics (indicate which ones) will be defined by the issuer subsequently and informed to the public prior to placement, by the means and within the timeframe defined by the Superintendent.
  In the case that the global amount of the program is revolving, include the meaning and conditions of this characteristic.
• Description of the possible placement mechanisms to be used and their rules. The mechanisms to be used by potential subscribers and their rules must also be indicated.
• Indication of the payment priority of the issuer's obligations, and identify the position occupied by the investors of the issuances.
• Process for the payment of interest and principal, including the names and contact details of the paying agent.
• Mention if there are issuances registered in other markets and indicate if the respective international identification code ISIN is available and point out the markets in which they are admitted to trading.
• Indication of the risk rating, its meaning, rating agency, number and date of the rating council, and date of the financial information used. Address of the rating agency's Website where more details of the rating can be consulted.

e. Risk factors affecting the issuance and the issuer

• Prominent disclosure of the risk factors that can impact the issuer's capacity to pay the interest or principal of the debt subject to the prospectus, in accordance with what is established in subsection e.1 of Annex I of this standard.

f. Indebtedness and capitalization

• In accordance with what is established in subsections e.3 of Annex I of this standard.

g. Information on the issuer:

• Social denomination of the issuer
• Organizational chart of the issuer
• If the issuer is part of a group, brief description of the group and the position of the entity within it. If the issuer depends on another member of the group for its continued operations, explanation of that dependence.
• Names of the main executives of the company, including the area under their responsibility.
• Explanation of significant existing contracts in the issuing financial institution, outside its normal business, that can directly or indirectly impact its capacity to pay the interest or principal of the debt object of the prospectus.
• Description of any pending legal litigation, in which the issuer or any of its subsidiaries is a party (excluding from this description routine litigations, incidental to the ordinary course of business). Reference must be made to the court, tribunal, arbitration center, or administrative entity where the process is filed, start date, main parties, description of the facts, as well as the claim sought. Any legal litigation in which its shareholders, directors, and main officials are parties must also be described.
• Indicate the Website where the issuer maintains information available for consideration by investors: financial statements, corporate governance policies, and results of the previous period.
• Express indication that the audited financial information of the last 3 years and the auditors' report for those periods, as well as interim periodic information, is available to the public in the issuer's offices (include website), and in the Superintendence (include website).
• If the issuer wishes to incorporate financial information in any part of the prospectus that was not extracted from the audited financial statements, it must detail the source of that information and include a clarification that it does not correspond to audited information.
• Names and addresses of the external audit firm used during the last 3 years of financial statements. If there was a change of auditors during the last 3 years of financial statements, include the reasons.

h. Operating and financial results and prospective information (management opinion)

• In accordance with what is established in subsections g.1 and g.2 of Annex I of this standard.

i. Significant participations and transactions with related parties

• In accordance with what is established in subsections i.1, i.2, and i.3 of Annex I of this standard.

j. Financial information

• As an annex to the prospectus, the consolidated audited financial statements of the issuer and its controlling company, when applicable, must be attached, for the last fiscal period and interim quarterly for the current fiscal period, the last period with an age not greater than two months prior to the authorization request.

k. Periodicity of information to investors

• In accordance with what is established in subsection j.2 of Annex I of this standard.

l. Additional information

• Incorporate any other information on the issuer or the issuance that is deemed relevant for the investing public. If there are contracts of material impact for the issuance, they must be included in this section and indicate their numbering in the annexes.

THIRD: This standard shall enter into force from its publication in La Gaceta, Official Journal.

(f) V. Urcuyo V. (f) Gabriel Pasos Lacayo (f) illegible (Silvio Moisés Casco Marenco) (f) Fausto Reyes B. (f) ilegible (Freddy José Blandón Argeñal) (f) U. Cerna B.

URIEL CERNA BARQUERO
Secretary of the Board of Directors SIBOIF