Resolution SBS No. 0759-2007: Regulations for the Opening, Conversion, Transfer, and Closure of Offices of Savings and Credit Cooperatives Not Authorized to Operate with Public Funds

Lima, June 11, 2007
S.B.S. Resolution
No. 759-2007

The Superintendent of Banks, Insurance, and Private Pension Fund Administrators

CONSIDERING:

That, item 3 of the Twenty-Fourth Final and Complementary Provision of the General Law of the Financial System and of the Insurance System and Organic Law of the Superintendence of Banks and Insurance – Law No. 26702 and its amendments, hereinafter General Law, establishes that the supervision of savings and credit cooperatives not authorized to operate with third parties is the responsibility of the National Federation of Savings and Credit Cooperatives of Peru or other federations to which they voluntarily affiliate and that are recognized by this Superintendence;

That, item 6 of the aforementioned Final and Complementary Provision indicates that this Superintendence supervises and controls the aforementioned cooperatives' federations, regulates the operations of the referred savings and credit cooperatives, and is empowered to order the adoption of necessary measures to correct detected financial or administrative deficiencies;

That, the Regulations for Savings and Credit Cooperatives Not Authorized to Operate with Public Funds, approved by SBS Resolution No. 0540-99, in its Article 39 item b), establishes as one of the attributions of the National Federation of Savings and Credit Cooperatives of Peru, to approve, prior to implementation, the establishment of cooperatives' offices, as well as their transfer, conversion, and closure;

That, it is convenient to regulate the procedures that cooperative organizations must follow to receive authorization for the establishment of offices, as well as their transfer, conversion, and closure;

Being in accordance with the opinion of the Adjunct Superintendencies of Banking and Microfinance and Legal Advice; and,

In exercise of the powers established in items 7 and 9 of Article 349, as well as in the Twenty-Fourth Final and Complementary Provision of the General Law;

RESOLVES:

Article First.- Approve the Regulations for the Opening, Conversion, Transfer, and Closure of Offices of Savings and Credit Cooperatives Not Authorized to Operate with Public Funds, which forms an integral part of this Resolution.

Article Second.- This Resolution enters into force the day following its publication in the Official Newspaper El Peruano, repealing any previous policy that had been established regarding the opening, conversion, transfer, and closure of offices of cooperatives.

Register, communicate, and publish.

FELIPE TAM FOX
Superintendent of Banks, Insurance, and Private Pension Fund Administrators

REGULATIONS FOR THE OPENING, CONVERSION, TRANSFER, AND CLOSURE OF OFFICES OF SAVINGS AND CREDIT COOPERATIVES NOT AUTHORIZED TO OPERATE WITH PUBLIC FUNDS

1. Scope
   This regulation applies to savings and credit cooperatives not authorized to operate with third parties, referred to in the Twenty-Fourth Final and Complementary Provision of Law No. 26702, General Law of the Financial System and of the Insurance System and Organic Law of the Superintendence of Banks and Insurance, hereinafter cooperatives.

2. Description of Offices
   For the purposes of this Regulation, the following types of offices are established:

2.1 Head Office
It is the establishment constituted as the legal domicile of the cooperative, where the governing bodies that organize, administer, and direct the activities and businesses proper to the social object of the institution are located. It may perform any of the permitted services and operations. It centralizes the cooperative's accounting.

2.2 Branch
It is the establishment that depends organically from the head office; it may perform any of the services and operations permitted to the cooperative. Cooperatives may establish branches that supervise other branches and special offices.

2.3 Special Office
It is the establishment that depends organically from the head office or from a branch, and may perform some of the services and operations permitted to the cooperative, as well as provide information services regarding operations or collect documentation related to operations. The special office may be:
a) Permanent special office.- When its installation is for an indefinite period. b) Temporary special office.- When its installation is related to a specific event, with a validity period not exceeding three (3) months.

3. Authorization
   In accordance with Article 39 item b) of the "Regulations for Savings and Credit Cooperatives Not Authorized to Operate with Public Funds", approved by SBS Resolution No. 0540-99 and its amendments, cooperatives require prior approval from FENACREP, hereinafter Federation, for the establishment of offices, as well as their transfer and closure.

For this purpose, cooperatives must submit to the Federation a request attaching a certified copy of the relevant part of the minutes where the corresponding agreement of the board of directors is recorded.

3.1 Opening of a Branch
For the establishment of a branch, cooperatives must submit, in addition to the request, in the terms indicated above, an "Economic Feasibility Profile" which must contain as a minimum the information listed in Annex A of this Regulation.

3.2 Opening of Special Offices
For the establishment of a permanent special office, cooperatives must submit, in addition to the aforementioned request, the "Economic Feasibility Profile" mentioned in the previous point, without considering item 7) of Annex A of this Regulation.

When it concerns the opening of temporary special offices or special offices established only to provide information services about the operations and services offered by the cooperative, the Profile will not consider items 2), 3), 7), and 8) of Annex A of this Regulation.

3.3 Transfer of Offices
The transfer of offices can only be carried out within the geographic and economic influence area indicated in the "Economic Feasibility Profile" prepared by the cooperative for the opening of the office proposed to be transferred.

For this purpose, cooperatives must submit a request attaching a certified copy of the relevant part of the minutes where the agreement of the board of directors is recorded, as well as the location and address of the property where the office will operate.

In the event that the transfer is carried out outside the aforementioned geographic and economic influence area, cooperatives must submit the request as a closure and opening of office respectively.

3.4 Conversion of Offices
Cooperatives may convert special offices into branches; for this purpose, cooperatives must submit a request attaching a certified copy of the relevant part of the minutes where the agreement of the board of directors is recorded. Likewise, the "Economic Feasibility Profile" required for the opening of branches will be attached.

3.5 Closure of Offices
For the closure of offices, cooperatives must submit a request attaching a certified copy of the relevant part of the minutes where the agreement of the board of directors is recorded. Cooperatives must comply with the following conditions for the requested office closure:
a) Display the board of directors' agreement in the office premises for thirty (30) days prior to the closure. They may also inform through the communication media they deem necessary. b) Indicate the office that will take charge of continuing to provide the operations and services of the closing office.

4. List of Offices
   Cooperatives must send to the Federation within the first twenty (20) calendar days of January of each year, the list of their offices according to the format of Annex B of this Regulation.

Likewise, they must permanently keep updated and available to FENACREP, when requested, their "Annual Plan for Opening, Conversion, Transfer, and Closure of Offices", which must have the corresponding approval of the corresponding social body.

5. Deadline for Issuance of Authorization Document
   For the issuance of the corresponding office authorization document, FENACREP will have a period not exceeding sixty (60) calendar days, after receiving the request with complete information.

6. Deadline for Opening, Conversion, Transfer, and Closure of Offices
   Regarding the opening, conversion, transfer, and closure of offices, the authorization granted by FENACREP will become void if the cooperative does not proceed with the opening, conversion, transfer, and closure of offices within six (6) months following the date on which the respective authorization was granted.

ANNEX A
ECONOMIC FEASIBILITY PROFILE
It must contain as a minimum the following information:

1. Geographic and economic influence area of the proposed office. The location and address of the property where the office will operate will also be indicated.

2. Total population and economically active population of the operating zone.1

3. Evolution of the microfinance market (savings and credit) in the last two (2) years, and an estimate of the proposed office's participation in said market. 1

4. Operations and services intended to be performed, as well as the indication of the electronic data systems to be used.

5. Functional organizational chart and personnel needs table.

6. Indication of the organic dependency of the office.

7. Indication of the offices under its responsibility, if applicable.

8. Projection of financial statements and break-even point for a period of no less than two (2) years. 1

These aspects will not be considered when it concerns the opening of temporary special offices or special offices constituted solely to provide information services about the operations and services performed by the cooperative.

Los Laureles No. 214 - Lima 27 - Peru Tel. : (511)2218990 Fax: (511) 4417760

ANNEX B
LIST OF OFFICES
COOPERATIVE:
DATE:
Offices Department Province District Address FENACREP Authorization Number:
Date of
Opening
No. of
Employees
Operations (1)
Head Office
Branch
Branch
Permanent special office
Permanent special office
Temporary special office
Temporary special office
(1): Only in the case of special offices, indicate the operations they perform ------ ------ GENERAL MANAGER AUTHORIZED OFFICIAL

Los Laureles No. 214 - Lima 27 - Peru Tel. : (511)2218990 Fax: (511) 4417760