The financial entities that participate in the issuance must comply with the rules on credit risk fractionation.
Through Communication “A” 7974/2024, the Central Bank (BCRA) communicated the decision of not raise objections to the purchase of Treasury Bills by financial entities. It should be noted that Treasury Bills are a financial instrument issued by the Government to obtain financing.
In this case, the province of Córdoba is issuing Treasury Bills for a total value of $49,000,000,000 (Argentine pesos forty-nine billion) as part of the “Treasury Bill Program 2024“.
In this context, the BCRA will not object to financial entities purchasing these Treasury Billsprovided the following conditions are met:
- Financial entities must comply with the regulations on “Financing to the non-financial public sector.”
- Financial entities must comply with the conditions established in Resolution Series A 0008/24 of the Municipal Secretariat of Public Administration and Human Capital and Municipal Decree No. 149/24.
- Financial entities must comply with the conditions established in RESOL-2024-20-APN-SH#MEC of the Ministry of Finance of the Ministry of Economy of the Nation.
- Financial institutions must observe the provisions regarding credit risk fractionation.
Thus, the official text authorizes financial entities to buy Treasury Bills issued by Córdobaprovided those conditions are met.
Chaco
Likewise, the Communication “A” 7975/2024, endorses the same for the Treasury Bills of the Province of Chaco for the year 2024.
Thus, the official text of the BCRA authorizes the issuance of Treasury Bills with capital adjustment through the Reference Stabilization Coefficient (CER).
- Establishes that financial entities participating in the issuance must comply with the rules on credit risk fractionation.
Point 1: “Financing to the non-financial public sector.” This restriction prohibits financial entities from making observations on changes in the interest rates of Treasury Bills.
Point 2: At this point, the modification of the interest rate for the issuance of Chaco Treasury Bills for the year 2024 is authorized. The modification consists of the incorporation of the possibility of issuance with capital adjustment through the CER.
Point 3: refers to the rules on credit risk fractionation. These regulations establish that financial entities that participate in the issuance of Treasury Bills must diversify their credit risk.
In conclusion, the text authorizes the modification of the interest rate for the issuance of Chaco Treasury Bills for the year 2024. LThe modification consists of the incorporation of the possibility of issuance with capital adjustment through the CER. The financial entities that participate in the issuance must comply with the rules on credit risk fractionation.
Source: Ambito
