Bopreal: banks took the lead in distributing dividends

Between this Wednesday and Thursday, the first Bopreal series 3 auction will be held, in which companies with dividends withheld due to the validity of the dollar stocks can participate. This is the bonus for importers issued by the Central Bank (BCRA) in order to regularize pending commitments with foreign suppliers.

But as there is also a significant stock of profits and dividends not transferred abroad, the BCRA allowed, via Communication A7999, that companies with dividends pending payment to non-resident shareholders, as well as non-residents that have received dividends in pesos in the country in recent years.

In this framework, four financial entities took the lead. They are the banks Santander, Galicia, Macro and BBVA who informed the Stock Exchange via “relevant facts” that the BCRA authorized them to distribute profits for a total of 1.1 trillion pesos, says the consulting firm 1816. So non-resident shareholders of these financial entities can choose to collect in one installment by subscribing to Bopreal.

It should be noted that unlike the case of importers, the new Bopreal plaintiffs will not be able to access the CCL dollar for the difference between the sale price of the bonds and their face value to cancel 100% of the dividend debts. Instead, Importers who buy Bopreal do have the CCL dollar enabled without affecting their access to the official exchange market to pay off their commercial debt, given that the Bopreal are listed below par.

In this regard, it is worth remembering that the Bopreal pay the PAIS tax, so that the implicit exchange rate of buying the Series 3 in the primary against pesos and selling them in the secondary against dollars is around 1,330 pesos per dollar, according to calculations by 1816, so we will have to see the differential with respect to the CCL.

The market expectation was to see if companies with pending dividends were willing to validate those levels or preferred to wait, however, four banks have already taken the lead on the issue.

Of course In the meantime, the Government decided to expand the scope of the COUNTRY tax both for the purchase of foreign currency intended for transfers of profits and dividends, and for those who subscribe to Bopreal.which injected more noise about the upcoming auction.

The scope of the new BCRA provision

The new regulations establish a 17.5% rate applicable to the purchase of foreign currency intended for the repatriation of investments of non-resident portfolio and to the distribution of profits and dividends, in addition, the same percentage applies to those who acquire Bopreal for similar purposes.

In relation to the BCRA’s authorization of the use of Bopreal for the payment of profits and dividends pending payment to non-resident shareholders, Baker McKenzie experts explain that they may be subscribed for up to the equivalent of the amount in pesos of those profits. and dividends according to the distribution by the shareholders’ meeting (in the case of non-resident entities it will be up to the equivalent in pesos of the profits and dividends collected as of September 2019 adjusted by CPI).

In addition, “Bopreal may be applied to securities operations with the purpose of canceling profits and dividends pending payment to non-resident shareholders without losing access to the free exchange market when such operations are carried out for up to the amount of the bond acquired in subscription. primary, and said securities operations may be settled in third-party accounts abroad.”