Título XVI. Disposiciones transitorias y finales

To belong to a financial group, the companies specialized in financial services currently incorporated shall adapt their corporate purpose to the provisions of Article 36 of the present Law, within the time limit of six months from its entry into force.

Within the six months following the beginning of the entry into force of this Law, every entity subject to supervision and inspection by the Superintendency of Banks shall inform the latter in writing whether or not it belongs to a group acting as a financial group, as well as the corporate name of the companies forming the group.

The companies that apply to form as a financial group, and obtain the respective authorization from the Monetary Board, shall fully formalize their formation as a financial group within the time limit of six months, counted from the date of said authorization. The Superintendency of Banks, upon justified request of the interested parties, may extend the time limit for up to the same period, only once.

Files opened and proceedings initiated under the laws repealed by this Law shall be decided on the basis of the law in force on the date of their initiation and other provisions of the Law of the Judicial Branch, except with regard to applications for the incorporation of banks or the establishment of branches of foreign banks, which shall be decided in accordance with the provisions established on that matter by this Law.

As a consequence of the foregoing, for the processing and conclusion of the administrative and judicial proceedings pending decision by the competent administrative or jurisdictional authority, in which the legal situation of banking institutions or private financial companies is being determined, the legal provisions contained in Decree Number 315, Banking Law, and Decree Number 5-99, Law for the Protection of Savings, both of the Congress of the Republic, shall apply, provided that such proceedings were initiated while the aforementioned decrees were in force.

The operations referred to in subparagraph a) of Article 47 of this Law, which at the time of its entry into force exceed the limit set forth in said subparagraph, shall be reduced to a maximum permitted limit of seventeen point five percent (17.5%) within the first six (6) months that this Law is in force, and to fifteen percent (15%) in the following six (6) months.

In the case of the operations of financial companies that convert into banks and those of banks that merge with financial companies, which as a result of such transformation or merger present an excess over the financing limit for a single natural or juridical person, they shall conform to the financing limit established by law within a time limit of one additional year beyond that referred to in the preceding paragraph. To that end, the entity concerned shall inform the Superintendency of Banks, no later than the fifteenth day of the month following that in which the merger occurs

Table 1.

BANKS DATES FIDUCIARY

AS OF 30/09/2002 40% AS OF 31/03/2003 35% AS OF 30/09/2003 30% AS OF 31/03/2004 or transformation giving rise to the excess over the financing limit.

In accordance with the process for the reduction of concentration of financing operations with related or linked persons that form part of risk units, initiated pursuant to the law in the month of September 1999, the gradual schedule for reaching the percentages established in subparagraph b) of Article 47 of this Law shall be as follows:

(see Table 1)

For purposes of application of the ten percent on assets and contingencies referred to in Article 64 of this Law, if upon its entry into force banking institutions have required capital of less than such ten percent (10%), it shall be increased by zero point five percent (0.05%) semiannually, beginning six months after the Law enters into force.

The offshore entities or offshore entities that have been operating in Guatemala shall obtain operating authorization subject to the provisions of this Law, within the time limits established in Article 116 thereof.

The first paragraph of Article 3 of the Private Financial Companies Law, Decree-Law Number 208, is reformed, to read as follows:

“For the formation of the Financial Companies, the requirements prescribed in the Law of Banks and Financial Groups shall be met, and for their authorization the procedures that said law establishes for the creation of new banks shall be followed.”

Article 4 of the Private Financial Companies Law, Decree-Law Number 208, is amended to read as follows:

“Article 4. Financial Companies shall be subject to the jurisdiction of the Monetary Board and to the supervision and inspection of the Superintendency of Banks, remaining subject to the provisions of Article 111 of the Law of Banks and Financial Groups.”

Article 14 of the Private Financial Companies Law, Decree-Law Number 208, is amended to read as follows:

“Article 14. Article 54 of the Law of Banks and Financial Groups, relating to Extraordinary Assets, shall not be applicable to Private Financial Companies. However, when immovable property is adjudicated to a financial company or received by it in payment, it shall transfer ownership thereof by sale or by any other title, within a time limit of no more than three years, unless, at its request, the Monetary Board resolves to extend said time limit for up to two additional years at most. Otherwise, the provisions established in the last three paragraphs of said Article 54 shall be applied.”

Article 15 of the Private Financial Companies Law, Decree-Law Number 208, is amended, which shall read as follows:

“Article 15. Subsection f) of Article 45 of the Banks and Financial Groups Law shall not be applicable to Private Financial Companies.”

The resources that, in compliance with the provisions of Article 104 of Decree Number 315 of the Congress of the Republic, Law of Banks, have been generated or are generated for the Fund for the Protection of Savings referred to in Decree Number 5-99 of the Congress of the Republic, Law for the Protection of Savings, and the resources that, in observance of the provisions of Decree Number 4-2002 of the Congress of the Republic, Law of Banks and Financial Groups, have been generated or are generated for the Fund for the Protection of Savings referred to in this Law, shall increase the Fund for the Protection of Savings created in this decree, therefore the Bank of Guatemala is authorized, without prior or subsequent procedure, to transfer said resources to the accounts of this fund.

Reference. In any provision in which reference is made to the Law of Banks, contained in Decree Number 315, and to Decree Number 4-2002, both of the Congress of the Republic, it shall be understood to refer to the Law of Banks and Financial Groups contained in the present Decree.

The Law of Banks and Financial Groups, contained in Decree Number 4-2002 of the Congress of the Republic, is repealed, as well as any other legal and regulatory provisions that conflict with this Decree.

The Monetary Board shall issue the regulations that in its judgment are necessary for the proper application of this Law.

This Decree was declared of national urgency and approved in a single debate.

This Decree was approved with the favorable vote of more than two-thirds of the deputies who comprise the Congress of the Republic, shall be published in the official journal and shall enter into force on 1 June 2002.