Shareholdings in Companies Carrying Out Complementary Activities

CENTRAL BANK OF THE ARGENTINE REPUBLIC __________________________________________________________________ COMMUNICATION " A " 2619 12/11/97 __________________________________________________________________ TO FINANCIAL INSTITUTIONS: Ref.: Circular RUNOR 1 - 247. LISOL 1 - 168. OPRAC 1 - 414. Shareholdings in the capital of companies that carry out complementary activities We are writing to inform you that this Institution has adopted the following resolution: "- To provide that, effective from 1.12.97, the direct or indirect acquisition or incorporation by financial institutions of shareholdings in companies whose purpose is the development of activities complementary to the financial activity, which exceed 12,5% of the share capital of said companies and without prejudice to the specific regulatory treatment applicable in each case, shall be subject to prior authorization by the Superintendency of Financial and Exchange Institutions, for which the fulfillment of the requirements contained in points 1.1. to 1.3. of Circular CREFI - 2 shall be a condition. The relevant authorization applications shall be accompanied, in accordance with the procedure established for that purpose, by the following information: - name, corporate purpose and description of the company's activities and specification regarding its degree of connection with the financial activity and the intention to exercise or not the social control. - corporate bylaws. - amount of the investment and disbursement schedule. - shareholding in the share capital, its total percentage distribution and list of shareholders who have influence on the company's decisions. - background of the partners who exercise social control.

• degree of liquidity of the investment (negotiability - current or future - on securities markets).

• intervention of the management and senior management of the financial institution in the management of the company's business.

• use of the institution's infrastructure for the offering of services provided by the company.

• any other information that, in the opinion of the financial institution, is useful for this Institution to evaluate the impact of the investment on its solvency, managerial capacity and management.

The Superintendency of Financial and Exchange Institutions will evaluate the characteristics of each project, emphasizing the impact of the investment on the solvency of the financial institution and its management capacity.

Non-compliance with the presentation of the required information and the fact that the corporate bylaws do not expressly contemplate the following shall be considered grounds for denial of the authorization:

a) that the amendments to the corporate purpose must be previously authorized by the Superintendency of Financial and Exchange Entities and

b) that the verification of its operations be admitted with the scope provided for in the Law on Financial Entities.

Regarding the time periods for approval of authorization applications, the provisions of point 3.3. of Section 3 of Chapter II of Circular CREFI - 2 shall apply.

When the level of participation does not determine the requirement of consolidation in accordance with the provisions issued by Communication "A" 2227, the Superintendency of Financial and Exchange Entities shall determine in each case whether or not the information of the company in which the participation is authorized must be consolidated, with the general scope provided for in the aforementioned regime."

We greet you very attentively.

CENTRAL BANK OF THE ARGENTINE REPUBLIC

Juan Carlos Isi
Alfredo A. Besio
Subgerente de Normas
Gerente de Normas para for Financial Entities
Entidades Financieras