Resolution SBS No. 3301-2020: Amend Special Norms for Implementing Law No. 30607 and the Regulation on the Participation of Municipal Savings and Credit Banks in Public Investment Laws

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Lima, December 29, 2020

Resolution S.B.S.
No. 3301-2020

The Superintendent of Banks, Insurance and Private Pension Fund Administrators

CONSIDERING:

That, through Resolution SBS No. 1325-2018, the Special Norms for the implementation of Law No. 30607 were approved, in which the regulatory provisions applicable to Municipal Savings and Credit Banks are established by virtue of the requirements introduced by Law No. 30607, the Law that Modifies and Strengthens the Operation of Municipal Savings and Credit Banks;

That, through Resolution SBS No. 1706-2018 and its amendments, the Regulation on the Participation of Municipal Savings and Credit Banks in the Law that promotes regional and local public investment with the participation of the private sector was approved, in which the prior requirements and prudential criteria linked to issues of profit capitalization, risk management and corporate governance are established, which must be considered by Municipal Savings and Credit Banks for their participation in public investment projects under Law No. 29230 and its amendments, the Law that promotes regional and local public investment with the participation of the private sector;

That, it is necessary to modify the Special Norms for the implementation of Law No. 30607 in order to make clarifications regarding the standards linked to good corporate governance and risk management, established by this Superintendency to determine the percentage of profit capitalization of each fiscal year that corresponds to the Municipal Councils;

That, likewise, it is necessary to modify the Regulation on the Participation of Municipal Savings and Credit Banks in the Law that promotes regional and local public investment with the participation of the private sector, in order to make clarifications regarding the prior requirements linked to good practices of corporate governance and comprehensive risk management, established by this Superintendency so that Municipal Savings and Credit Banks can participate in public investment projects under Law No. 29230 and its amendments, as well as make clarifications regarding the application of regional and local public investment certificates or national government public investment certificates, as appropriate, for the execution of a new work under the tax-for-works mechanism;

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That, in order to collect the opinions of the general public regarding the regulatory proposal, the pre-publication of the draft resolution on the matter was ordered on the electronic portal of the Superintendency, under the provisions of the Thirty-Second Final and Complementary Provision of the General Law and Supreme Decree No. 001-2009-JUS and its amendments;

Having the approval of the Adjunct Superintendencies of Banking and Microfinance and of Legal Advice; and,

In exercise of the powers conferred by paragraphs 7 and 9 of article 349 of the General Law of the Financial System and the Insurance System and the Organic Law of the Superintendency of Banking and Insurance (Law No. 26702 and its amendments), and based on the exceptional conditions provided for in article 14 of Supreme Decree No. 001-2009-JUS and its amendments;

RESOLVES:

Article First.- Replace article 5 of the Special Norms for the implementation of Law No. 30607, approved by Resolution SBS No. 1325-2018, with the following:

“Article 5.- In accordance with articles 4 and 4-A of the Special Law, after applying the precedence established in paragraphs 1 and 2 of article 66 of the General Law, a minimum of fifty percent (50%) of the profits of each fiscal year that correspond to the Municipal Councils must be capitalized; said capitalization percentage may be raised to seventy-five percent (75%) if the corporate governance and risk management of the CMAC do not meet all the standards detailed below:

a) The CMAC has at least five (5) nominated directors.

b) In the case of Joint Management, it is complete with titular members. Exceptionally, two (2) Acting Managers may be allowed for a maximum term of six (6) months of acting status.

c) The CMAC does not present pending regulatory or prudential requirements for provisions, liquidity or capital, formulated by the Superintendency, for attention.

d) The CMAC complies with what is established in the Regulation for the Requirement of Additional Effective Equity approved by Resolution SBS No. 8425-2011 and its modifying norms.

e) The indicator “Adjusted Effective Equity between Total Adjusted Assets and Contingents Weighted by Total Risk” defined in article 14 of Chapter IV of the Subordinated Debt Regulation applicable to Financial System Companies approved by Resolution SBS No. 975-2016, is greater than 5.125%.

To determine the capitalization percentage that corresponds to the Municipal Councils, the Internal Audit Unit of the CMAC must prepare a report in which it evaluates the compliance with each of the standards mentioned above, with a cut-off date of December 31 of the previous year.

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This report must be approved by the Board of Directors and sent to the Superintendency no later than the fifteenth (15) of February, together with the Board of Directors minutes where its approval is recorded. In addition to the report prepared by the Internal Audit Unit, the Superintendency may consider, for the purpose of determining the capitalization percentage, that the performance of the General Shareholders' Meeting, Board of Directors and Joint Management or General Management of the CMAC is in accordance with the powers, functions and provisions established in the Special Law, General Law and its regulatory norms.

Within a period not exceeding thirty (30) calendar days from the receipt of the aforementioned report, the Superintendency may rule on the evaluation carried out by the Internal Audit Unit; otherwise, it will be understood that the results of said evaluation are in conformity. The profit capitalization percentage must be adjusted to the results of the aforementioned Internal Audit Unit evaluation or, if applicable, to the pronouncement of the Superintendency, which has a binding nature. The General Shareholders' Meeting must proceed to formalize the corresponding agreement in the Meeting referred to in article 114 of the General Companies Law.”

Article Second.- Modify the Regulation on the Participation of Municipal Savings and Credit Banks in the Law that promotes regional and local public investment with the participation of the private sector, approved by Resolution SBS No. 1706-2018 and its amendments, according to the following:

1. Replace article 5 with the following text:

“Article 5.- Corporate governance and comprehensive risk management requirements

5.1 To participate in the tax-for-works mechanism, the CMAC must have good practices of corporate governance and comprehensive risk management, as established in this article.

5.2 It is considered that the CMAC has good practices of corporate governance and comprehensive risk management when it meets the following conditions:

a) The Board of Directors is composed of at least five (5) Directors.

b) The Joint Management is complete with titular members, and exceptionally, two (2) Acting Managers may be allowed for a maximum term of six (6) months of acting status.

c) The high-risk portfolio indicator minus the total provisions for placements, divided by effective equity, must be less than five percent (5%) on the cut-off date of the report referred to in article 7 of this Regulation.

d) The CMAC complies with what is established in the Regulation for the Requirement of Additional Effective Equity.

e) The indicator “Adjusted Effective Equity between Total Adjusted Assets and Contingents Weighted by Total Risk” defined in article 14 of Chapter IV of the Subordinated Debt Regulation, is greater than 5.125%.

f) The CMAC does not present pending regulatory or prudential requirements for provisions, liquidity or capital, formulated by this Superintendency, for attention.

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g) The CMAC does not present losses in the last three (3) closed annual fiscal years as of the cut-off date of the report referred to in article 7 of this Regulation.

5.3 In order to comply with the indicator indicated in paragraph c) of numeral 5.2, the CMAC may constitute voluntary provisions, which can only be reversed with prior authorization of this Superintendency.

5.4 This Superintendency may establish, for prudential reasons, additional requirements for the participation of CMACs in the tax-for-works mechanism.”

2. Replace numeral 6.4 of article 6 with the following text:

“Article 6.- Profit capitalization requirement and limit to participation in the tax-for-works mechanism

(…)

“6.4 The CMAC cannot carry out a new work under the tax-for-works mechanism until the certificates obtained have been applied, having to communicate to this Superintendency the total application of the certificates obtained. This provision may be exempted by this Superintendency whenever the non-application of said certificates is due to causes unrelated to the CMAC, for which it must present its duly substantiated and documented exception request, which must be previously approved by the Board of Directors of the CMAC.”

Article Third.- Exceptionally, due to the measures adopted by the State to mitigate the spread of COVID-19 and the impact of these on the operability of CMACs, for the purpose of presenting the annual report referred to in article 7 of the Regulation on the Participation of Municipal Savings and Credit Banks in the Law that promotes regional and local public investment with the participation of the private sector, approved by Resolution SBS No. 1706-2018 and its amendments, corresponding to 12.31.2020, the maximum amount of total investment for the execution of the selected work, stipulated in numeral 6.1 of article 6 of the aforementioned Regulation, will be determined based on the percentage of income tax and profit capitalization of the 2020 or 2019 fiscal year.

Article Fourth.- This Resolution enters into force the day after its publication in the official newspaper El Peruano.

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JAVIER POGGI CAMPODÓNICO
Superintendent of Banks, Insurance and
Private Pension Fund Administrators (a.i.)