The Executive Board of the Banco de España, in accordance with the provisions of Article 23.1 (a) and (h) of Law 13/1994, of 1 June, of Autonomy of the Banco de España; in Article 66.1 (a) and (i) of the Regulation Internal to the Banco de España and in clause XII of the "General clauses applicable to the Monetary Policy Operations of the Banco de España" approved by Resolution of the Executive Commission of the Banco de España of 11 December 1998, and with reason for the adoption by the European Central Bank of the Guideline ("Guideline") (a) of 26 November 2012 amending Guideline ECB/2011/14 of 20 September 2011 on the instruments and procedures of the Eurosystem monetary policy (ECB/2012/25), agrees:

First.

Include in the "General Clauses applicable to the Monetary Policy Operations of the Banco de España" approved by Resolution of the Executive Board of the Banco de España on 11 December 1998 (hereinafter referred to as "Clauses"). General ") the following amendments:

1. The following wording is given to the second paragraph of General Clause V number 1:

" Marketable assets will be admitted as collateral in both simple and temporary open market operations and the marginal lending facility. Non-marketable assets shall be admitted as collateral in temporary open market operations and in the marginal lending facility, but not in simple transactions. '

2. The following sentence is added at the end of paragraph (a) of Section 2.1.1 of General Clause V:

"The ECB reserves the right to take such measures as it deems appropriate to correct any errors that may contain the announcement of the auction, including the cancellation or suspension of ongoing auctions."

3. The following sentence is added at the end of paragraph (d) of Section 2.1.1 of General Clause V:

"If the outcome of the auction contains erroneous information about any of these items, the ECB reserves the right to take the measures it deems appropriate to correct it."

4. The following wording is given to the 1.4 number of General Clause VI:

" 1.4 Counterparties may not deliver and the Banco de España shall not accept as collateral those assets issued or guaranteed by that counterparty or by another entity with which the former have close links. For this purpose, close links shall be understood to exist where the counterparty is linked to the issuer/debtor/guarantor of the eligible instrument in any of the following ways:

(a) The counterparty owns, directly or indirectly, through one or more companies, 20% or more of the issuer/debtor/guarant; or

(b) the issuer/debtor/guarantor owns, directly or indirectly, through one or more undertakings, 20% or more of the capital of the counterparty;

(c) a third party holds more than 20% of the capital of the counterparty and more than 20% of the issuer/debtor/guarantor's capital, either directly or indirectly, through one or more undertakings.

This rule will not be applied in the assumptions of:

(a) Close ties between the counterparty and the public sector entities of the countries of the European Economic Area which have the right to collect taxes, or in the case of an income instrument it is guaranteed by a public sector entity in the countries of the European Economic Area which has such a right.

(b) Guaranteed bonds issued in accordance with the criteria set out in points 68 to 70 of Part 1 of Annex VI to Directive 2006 /48/EC of the European Parliament and of the Council of 14 June 2006 on access to the the activity of credit institutions and their financial year.

(c) Cases in which securities are protected by specific legal safeguards comparable to those of the instruments referred to in subparagraph (b) above, such as (i) guaranteed non-marketable debt instruments for retail mortgages (RMBs), which are not securities or (ii) structured collateralised bonds in which all the criteria set out in points 68 to 70 of Part 1 of Annex VI to Directive 2006 /48/EC are met, with the exception of limits to guaranteed loans from the guarantee asset set.

In addition, a counterparty cannot provide as collateral any securitisation bonus if the counterparty (or any other third party with which it has close links) provides: (1) currency hedging ("currency"). hedge ") to the securitisation bond by formalising with the issuer an exchange rate risk hedging transaction, or (2) liquidity support for an amount of 20% or more of the outstanding balance of the securitisation bonds.

Counterparties who provide securitization bonds with close links to the originator of the guarantee assets of such a bond should inform the Bank of Spain of any planned changes to such bonds as may potentially affect its credit quality, such as the alteration of the interest rate applicable to the bonds, changes in the swap arrangement, changes in the composition of the underlying loans not provided for in the relevant prospectus or changes in the payment ranking order. The Bank of Spain shall be notified at least one month in advance of any changes in the securitisation bonds that have been provided as collateral. In addition, the counterparty shall, at the time of the provision of securitisation bonds, provide information on any changes made in the previous six months. The Bank of Spain shall not provide an opinion on the eligibility of securitisation bonds prior to a modification. '

5. A new section 1.5 is included in the General VI Clause with the following wording:

" 1.5 Despite its eligibility, the Banco de España may not accept the following marketable or non-marketable assets for its contribution as collateral by counterparties:

(a) Debt instruments whose maturity date is very short; and

(b) Debt instruments whose income flow (e.g. a coupon payment) occurs within a very short period of time. "

6. The following wording is given to Section 4.1 of Section VI:

" 4.1 Fixed Income Values.

4.1.1 For each marketable security asset, the Eurosystem defines the most representative price it uses in the calculation of its market value.

4.1.2 The value of a negotiable asset is calculated on the basis of the most representative price on the business day prior to the valuation date. In the absence of a representative price for a given asset on the business day preceding the valuation date, the Eurosystem defines a theoretical price. '

7. The following wording is given to Section 3.1.2 of Section VIII:

" 3.1.2 For the first and second non-compliances occurring within a period of 12 months, a pecuniary penalty equivalent to the result of applying the interest rate of the marginal lending facility shall be applied. in force at the time of the start of the default plus 2,5 percentage points, on the amount corresponding to the collateral or cash assets that the counterparty is unable to deliver or liquidate, and multiplied by the coefficient X/360, with X being the number of calendar days, with a maximum of seven, during which the The counterparty has not been able to guarantee or contribute the amount awarded during the expiry of an operation. For cases where, after the calculation has been made, an amount to be paid less than EUR 500, a minimum penalty of EUR 500 shall apply. '

8. The following wording is given to paragraphs 3.2.1 and 3.2.2 of Section VIII:

" 3.2.1 For the first non-compliance, the pecuniary penalty shall be equivalent to the result of applying the interest rate of the marginal lending facility in force at the beginning of the default plus 5 percentage points, on the amount corresponding to the unauthorised access to the marginal lending facility.

3.2.2 In the case of successive defaults, the penalising interest rate will be increased by 2.5 points each time a new non-compliance occurs within a period of 12 months, the penalty being calculated on the basis of the amount corresponding to the unauthorized access to the marginal lending facility. For cases where, once the above calculation has been made, an amount to be paid less than EUR 500, a minimum penalty of EUR 500 shall apply. '

9. The following wording is given to Section 3.3.1 of Section VIII:

" 3.3.3 In the first and second non-compliances occurring within a period of 12 months, the counterparty must pay a pecuniary penalty equivalent to the result of applying a penalty interest rate of an additional 2,5 percentage points at the interest rate of the marginal lending facility in force at the time the default is initiated, on the basis of the collateral that is not eligible (or the counterparty (a) may not be used), whether they are provided by the counterparty to the Banco de España or not withdrawn by the same on or before the start of the eighth calendar day following the occurrence of the fact that the assets are no longer eligible as collateral or that the entity cannot use them, multiplied by the coefficient X/360, where X is the number of calendar days, with a maximum of seven, during which the counterparty fails to comply with the rules on the use of collateral. For cases where, once the above calculation has been made, an amount to be paid less than EUR 500, a minimum penalty of EUR 500 shall apply. '

Second.

The amendments contained in the first point above shall apply from 3 January 2013.

Third.

A consolidated text of the "General Clauses applicable to the Bank of Spain's Monetary Policy Operations" (adopted by Resolution of its Executive Committee of 11 December 2001) is hereby approved as an annex to this Resolution. 1998), with the amendments made to them by Resolutions of the Executive Committee of 23 July 1999 (BOE of 7 August 1999), 26 October 1999 (BOE of 7 December 2000), 10 October 2000 (BOE of 20 December), 19 April 1999 2002 (BOE 29 June), 23 December 2003 (BOE of 5 March 2004), 4 March 2005 (BOE of 19 June 2003) (BOE of 5 March 2004) May), 20 September 2006 (BOE of 28 November), 21 September 2007 (BOE of 14 November), 26 November 2008, 22 January 2009, 21 May 2009, 6 October 2010 (BOE of 12 January 2011), 29 December 2010 (BOE of 12 January 2011), 12 January 2011) and 18 October 2011 (BOE of 27 December 2011) and this Resolution.

Madrid, December 26, 2012.-The Secretary General of the Banco de España, Francisco Javier Priego.

ATTACHED

General clauses applicable to the Bank of Spain's monetary policy operations

(Consolidated version)

Introduction.

I. General legal regime.

II. Scope of application.

III. Monetary policy operations.

IV. Basic conditions for monetary policy operations.

V. Procedures applicable to monetary policy operations.

VI. Warranty assets.

VII. Assumptions of non-compliance.

VIII. Effects arising from the alleged non-compliance.

IX. Force majeure.

X. Applicable law and jurisdiction.

XI. Address.

XII. Modification.

Introduction

I. The European System of Central Banks (ESCB) includes the European Central Bank (ECB) and the national central banks of the Member States of the European Union. In accordance with Article 127 of the Treaty on the Functioning of the European Union (the 'Treaty') and Article 2 of the Statute of the ESCB and of the ECB, the objective of the ESCB is to maintain price stability. Without prejudice to that objective, the ESCB shall support general economic policies in the European Union with a view to contributing to the achievement of the objectives of the Union, as set out in Article 2 of the Statute.

For the purposes of these General Clauses and in accordance with Article 282 (1) of the Treaty, the term "Eurosystem" is used to designate the members of the ESCB carrying out their tasks. The ECB and the national central banks of the Member States of the European Union which have adopted the single currency in accordance with the Treaty.

II. Among the basic tasks of the Eurosystem, as referred to in Articles 127.2 of the Treaty and 3.1of the Statute of the ESCB and of the ECB, is to define and implement the monetary policy of the Union.

III. The ECB, as a guarantor of the fulfilment of the tasks entrusted to the Eurosystem, in accordance with the provisions of the Treaty Articles referred to in paragraph I above and Articles 12.1 and 14.3 of the Statute of the ESCB and of the ECB, as in the first subparagraph of Article 3.1 (1), (2) and (20), regulates the monetary policy instruments and procedures of the Eurosystem, by means of the Guideline ("Guideline") of 20 September 2011 (ECB/2011/14) and their subsequent amendments.

This Guideline and its subsequent amendments contain the principles, instruments, procedures and criteria to which monetary policy operations should be adjusted between the central banks of the The Eurosystem and its monetary policy counterparties.

IV. In accordance with Article 1.3 of Law 13/1994, of 1 June, of the Autonomy of the Banco de España, as amended by Law 12/1998 of 28 April, in the exercise of the functions arising from its status as a member of the Eurosystem, the Banco de España shall comply with the guidelines and instructions of the ECB under the provisions of the Treaty and the Statute of the ESCB and of the ECB.

V. Among the tasks assigned by the Law to the Banco de España is to participate in the development of the Eurosystem ' s role of "defining and implementing the monetary policy of the Community".

In the exercise of its functions, the Banco de España shall be subject to private law, unless it acts in the exercise of the administrative powers conferred by the Law.

VI. In accordance with the above, and in order to establish the general framework to which, in accordance with the ECB Guideline referred to and with the specific characteristics of the financial system and the Spanish markets, the operations of The Bank of Spain's monetary policy with the institutions empowered to do so, and in accordance with the provisions of Article 23.1.a) of the Law of Autonomy of the Banco de España, the Executive Committee, in its session of 11 December 1998, has agreed in accordance with Article 66.1.a) of the Bank of Spain Regulation, approve the "Clauses" General applicable to the monetary policy operations " following the following:

I. General legal regime

They will be applicable to the monetary policy operations that the Banco de España contracts, in addition to the provisions of these General Clauses:

The Resolution of 26 November 2008 by the Executive Board of the Banco de España on temporary changes in the eligibility criteria for guarantee assets in the monetary policy operations of the Banco de España and other instructions and forecasts issued by the Bank of Spain in this respect.

The regulations, forecasts and instructions of the Banco de España that regulate TARGET2-Banco de España (hereinafter, TARGET2-BE) as well as the regulatory standards of the corresponding securities clearing and settlement systems, in the extent to which they are applied by reason of the subject matter.

What is established in the contracts concluded between the Banco de España and the counterparties in monetary policy operations, which will be in accordance with the models that the Banco de España has approved for the purpose.

II. Scope of application

1. The Banco de España will only operate with those entities that comply with the provisions of these General Clauses.

Only institutions which, in accordance with Article 19.1 of the Statute of the ESCB and the ECB are subject to the obligation to maintain minimum reserves, can access and participate in permanent facilities. open market operations performed by auction as well as in simple transactions.

2. In particular, the Bank of Spain shall conduct monetary policy operations with institutions that meet the following requirements:

To be a credit institution, or another entity subject to the maintenance of minimum reserves, established in Spain. An entity is considered to be established in Spain if it has its head office or a branch authorised to operate on Spanish territory.

To be financially solvent and subject to harmonised supervision by national authorities at the level of the European Union or the European Economic Area.

Given their special institutional nature in the law of the European Union, institutions within the meaning of Article 123 (2) of the Treaty which are solvent and are eligible as counterparties may also be accepted as counterparties. they are subject to scrutiny comparable to the supervision by the competent national authorities. Solvent entities that are subject to non-harmonised supervision by national authorities, comparable to harmonised supervision at the level of the European Union or the European Economic Area, may also be accepted as counterparties.

Meet the operational requirements set by the Banco de España.

The Bank of Spain shall also establish the minimum requirements for entities to be required for the procurement of certain categories of monetary policy operations.

In rapid auctions and bilateral procedures, the Banco de España will operate with counterparties included in its counterparty group for adjustment operations. However, both in one case and in another case the operations may be executed with a wider variety of counterparties.

If, for operational reasons, the Banco de España could not negotiate with all the entities in one or more of the transactions mentioned in the preceding paragraph, the Banco de España will follow a rotating call that ensure equitable access between entities.

Entities will be required to know and comply with all obligations under the rules of prevention of money laundering and terrorist financing.

3. In exceptional circumstances, the ECB may directly conduct bilateral adjustment operations with the entities it would have selected, as well as structural operations.

4. These General Clauses shall also apply to the monetary policy operations of the Banco de España when the collateral assets are deposited or registered outside of Spain.

The provisions of these General Clauses shall not apply to the activities of the Bank of Spain relating to the formation, administration or execution of guarantees on assets deposited or registered in Spain in its the status of an agent or a correspondent in monetary policy operations of the ECB or of another Central Bank belonging to the Eurosystem.

5. The Bank of Spain may share individual information relating to the participation of counterparties in the Eurosystem ' s operations (e.g. operational data), with the remaining members of the Eurosystem, provided that this is necessary for the implementation of monetary policy. This information shall be subject to compliance with the obligation of professional secrecy as provided for in Article 37 of the Statute of the ESCB and of the ECB.

III. Monetary policy operations

For the execution of monetary policy operations, the Banco de España will adjust to the following principles and rules:

1. General aspects.

1.1 The Bank of Spain in the performance of the tasks entrusted to it in accordance with Article 7. 3, paragraph (a) of its Autonomy Law, may carry out open market operations and offer permanent facilities.

The negotiation, formalisation and implementation of the operations relating to the various monetary policy instruments will be carried out in accordance with the Bank of Spain, without prejudice to the the contractual arrangements to which the different transactions are to be adjusted.

1.2 Definitions. -In these General Clauses the terms that are indicated with the meaning assigned to each of them are used below:

Open Market Operation: Operation executed in the financial markets at the initiative of the Banco de España. Taking into account their objectives, periodicity and procedures, the Eurosystem's open market operations can be divided into four categories: main refinancing operations, longer-term refinancing operations, operations of structural adjustment and operations. As regards the instrument used, temporary operations are the main instrument of the Eurosystem and can be used in the four categories mentioned above. In addition, for structural operations, the issuance of ECB debt certificates or simple transactions (purchases or sales) may be used, while for the execution of the adjustment operations, foreign exchange swaps may be used. Collection of fixed-term deposits.

Temporary Operation: Operation by which the Banco de España buys or sells assets through a Double or Buy-in Operation with a Repurchase Agreement, or performs credit operations with collateral.

Simple Sales: Transaction by which the Banco de España buys or sells cash or forward-term assets at market maturity. This type of operation also receives the name of the operation to be due. In exceptional circumstances, the ECB may carry out simple purchases.

Double and Buy-in Operations with Repurchase Agreement: Those in whose virtue the Seller sells securities or other assets to the Buyer against payment of a purchase price, while the latter should be sold to the first such securities or assets, or their equivalents, against the payment of the repurchase price, on a given date.

In particular, they will have the consideration of Double and Buy-to-Buy Operations with the following:

Double or simultaneous operations, as referred to in Article 5 (2) (e) .1. of the Royal Decree Law 5/2005 of 11 March, of urgent reforms to boost productivity and improve recruitment "public", consisting of the contracting, at the same time, of two purchases of opposite-sense values carried out both with values of identical characteristics and for the same nominal amount, but with different date of execution. The two purchases that make up a double or simultaneous operation may be both in the spot, both forward, or the first spot and the second in the term.

The repurchase agreements that are regulated in the fifth article, paragraph 2.e) .2. of the Royal Decree Law 5/2005 of 11 March, in which the holder of the securities sells them to the date of redemption, at the same time the repurchase of securities with identical characteristics and at the same nominal value, at a specified and intermediate date between the sale and the nearest amortisation date, even if it is partial or voluntary.

Loans or loans with collateral: Financing operations with the coverage of a guarantee on guarantee assets supported by the Banco de España.

Currency Swaps: Concurrent and timely transactions of one currency against another. The Banco de España will conduct open market monetary policy operations in the form of currency swaps when buying (or selling) euro cash in exchange for a currency and, at the same time, selling them (or buying them) in time.

Fixed term deposit: This is the deposit of cash constituted in the Banco de España by an entity for a fixed term and remuneration, and which may be made at the Banco de España.

Marginal Credit Facility: Permanent Facility of the Banco de España that entities acting as counterparties may use to receive one day credit at a specified interest rate previously.

Deposit Facility: One of the permanent facilities of the Banco de España that entities acting as counterparties may use to make deposits on a paid day at a specified interest rate previously.

Standard Auction: Auction procedure to be used by the Banco de España in its regular open market operations. Standard auctions are held within a 24-hour period. All counterparties that meet the general selection criteria are enabled to bid on these auctions.

Quick Auction: Auction procedure used by the Banco de España primarily for adjustment operations, when it is considered desirable to produce a quick effect on the market situation. Quick tenders are normally performed within a time period of ninety minutes and are restricted to a limited set of counterparties.

Bilateral procedure: Procedure by which the Banco de España deals directly with only one or a few counterparties, without making use of the auction procedures. Bilateral procedures include transactions executed through stock markets or market players.

Adjusted Market Value: For any temporary operation, it is the market value of the assets under contract deducted any cut, percentage or amount established by the Bank of Spain in its forecasts. on the valuation of collateral for monetary policy operations.

2. Open market operations.

2.1 Open market operations may take the form of Temporary Operations, Simple-to-maturity transactions, currency swaps, and fixed term deposit taking.

The procedures for performing open market operations may be: Standard Auctions, Quick Auctions, or Bilateral Procedures.

Taking into account its objectives, regularity and procedures, open market operations may be main refinancing operations, longer-term financing operations, adjustment operations and operations. structural.

2.2 Temporary Operations formalised by the Banco de España may be executed through Double-and/or Repurchase Transactions with a Repurchase Agreement, or by loans or loans with collateral.

2.3 Open market operations classes.

2.3.1 Main refinancing operations. -These are regular weekly liquidity, weekly frequency and normally due to one week maturity. The execution procedure will be the standard Auction procedure.

2.3.2 Longer-term refinancing operations. -These are Temporary Operations for the additional injection of liquidity, monthly frequency, and normally for three months. They will be run using Standard Auction.

2.3.3 Adjustment operations. -Adjustment operations are intended to regulate the liquidity situation in the market and to control interest rates, in particular to soften the effects caused by unexpected fluctuations. of liquidity in the market on interest rates. These adjustment operations may be executed on the last day of a minimum reserve maintenance period in order to offset liquidity imbalances that may have accumulated since the last major operation was awarded. of funding.

Such adjustment operations will be primarily used through temporary operations, but may also take the form of foreign exchange swaps or fixed term deposit collection.

The procedures for the award or, where appropriate, the negotiation of the adjustment operations may be rapid Auction or bilateral interventions, in accordance with the corresponding instructions of the Banco de España.

In exceptional circumstances, bilateral adjustment operations may be conducted directly by the ECB itself.

2.3.4 Structural operations. -Structural operations consist of the placement of issuance of ECB debt certificates, Temporary Operations and Simples (purchases or sales).

The award procedures or, where appropriate, negotiation for this operational modality will be the Standard Auction for Temporary Operations and the issuance of ECB debt certificates, and bilateral procedures for You are firm.

In exceptional circumstances, structural operations can be performed directly by the ECB itself.

3. Standing facilities.

The Banco de España may grant permanent facilities to the entities referred to in Section II of these General Clauses, subject to compliance with the conditions of access that the Banco de España has set.

By means of the Marginal Credit Facility, the Banco de España may provide one day liquidity against the guarantee assets referred to in Section IV of these General Clauses. Institutions shall only have access to the Marginal Credit Facility on the days on which TARGET2 is operational and only if they have access to an account at the NCB where the transaction can be cleared (for example, on the single shared platform of TARGET2). In the days in which the corresponding system of clearing and settlement of securities is not operational, access to the Marginal Credit Facility shall be granted on the basis of the pre-deposited guarantee assets in favour of the corresponding central bank.

In exceptional cases, the Banco de España may establish limitations or suspend access to the Marginal Credit Facility.

By means of the Deposit Facility, the Banco de España may accept deposits with one day from the entities referred to in Section II of these General Clauses. Institutions shall only have access to the Marginal Deposit Facility on a day on which TARGET2 is operational and only if they have access to an account at the NCB where the transaction can be wound up, as in the single shared platform of TARGET2.

In exceptional cases, the Banco de España may establish limitations or suspend access to the Deposit Facility.

4. Fixed term deposits and Deposit Facility.

Fixed Term Deposit and Deposit Facility operations referred to in the preceding number 3 shall conform to the following:

1. The Banco de España, as a member of the interbank deposit market, will receive fixed term deposits and will offer Deposit Facility in accordance with these General Clauses and with the instructions of the same.

2. Deposits for monetary policy operations shall always be non-transferable and shall be formalised according to the specifications of TARGET2-BE.

IV. Basic conditions for monetary policy operations

1. The basic conditions under which the auctions will be held or shall negotiate the transactions, the arrangements for the procurement and the formalisation, the procedures for the settlement of transactions, and the criteria for admission and valuation of the guarantee assets and the risk control measures for each of the monetary policy instruments shall be those established by the Bank of Spain in accordance with the Guideline of the ECB of 20 September 2011 (ECB/2011/14) and provisions amending and with these General Clauses, without any other limitations than arising from the regulation of the organised markets in which transactions are negotiated and settled, depending on the nature of the negotiated asset or the legal business used.

2. In no case shall the general terms or conditions which an entity proposes in connection with a monetary policy operation be accepted.

3. The operations shall be formalised in accordance with the technical procedures available to the Bank of Spain for the same and with whatever is established in the contractual instruments that are applicable.

4. The counterparty shall provide the Bank of Spain with immediate information that is requested by it or which is relevant to the operations covered by these General Clauses.

Counterparties must be at all times in a situation of (i) transferring a sufficient amount of eligible assets, or cash, to settle (on the settlement date), or to ensure, until the maturity of the transaction by means of the corresponding adjustment of the margin of guarantee, the amount awarded at an auction in a liquidity injection operation, and (ii) to deliver a sufficient amount of cash to settle the amount that has been given to it awarded in an auction in a liquidity absorption operation.

In addition, counterparties must be at all times in a position to deliver the amount of collateral or cash agreed to settle transactions executed through bilateral transactions, or to ensure a pending bilateral transaction at any time to maturity through the corresponding adjustment of the margin of guarantee.

5. The rights and obligations of counterparties arising from monetary policy operations which have been formalised with the Banco de España may not be transferred, taxed or traded by such counterparties without the prior written consent of the Banco de España.

6. The Banco de España will liquidate all the transactions referred to in these General Clauses in euro, except for payments relating to foreign exchange swaps which, if necessary, should be made in another currency.

7. The counterparty is obliged to notify by written acknowledgement of receipt to the Banco de España any variation in the powers of representation it has granted in relation to these General Clauses or with the policy operations monetary agreed under their coverage.

The contravention of the provisions of this number 7 will imply that the counterparty will be obliged to the Banco de España for the signature of any proxy or person entitled to it. If the Bank of Spain has received the appropriate notification, it would not be able to invoke the revocation or reduction of the proxy even if it was valid in law until the Bank of Spain received the appropriate notification.

V. Procedures applicable to monetary policy operations

1. Guarantee assets.-All credit or financing operations referred to in Section III shall be used with the support of guarantees eligible for the whole of the National Central Banks, members of the European Monetary Union, in the terms of the following Section VI.

2. Marketable assets shall be admitted as collateral in the temporary and simple open market operations and the marginal lending facility. Non-marketable assets will be admitted as collateral in the temporary open market operations and in the marginal lending facility, but not in the simplements2. Procedures in open market operations and standing facilities,

2.1 Procedures in Open Market Operations.-The procedures for the conduct of open market operations may be: Standard Auctions, Quick Auctions, or Bilateral Procedures.

Both standard Auctions and Quick Auctions may be at a fixed interest rate as at the variable rate. In an auction at a fixed interest rate, the interest rate shall be specified in advance. Institutions will be able to raise the amount of money they want to negotiate on that fixed rate. In a variable interest rate auction, institutions shall express, for each "bid", the amount of money and the interest rate to which they wish to perform the transaction.

For the form of award, variable interest rate auctions may be "Dutch auctions" and "American auctions". In the single type award ('Dutch auction '), the rate of interest, price or quote Swap applied for all the offers satisfied shall be equal to the interest rate, price or marginal Swap price. In the award of multiple types ("American auction"), the interest rate, price or quote Swap will be equal to the bid in each individual bid.

2.1.1 Standard Auctions.

a) Announcement of the auctions (day D-1).-The day before the auction resolution, the characteristics of the auctions will be publicly announced through the usual means.

The ECB reserves the right to take the measures it deems appropriate to correct any errors that may be contained in the announcement of the auction, including the cancellation or suspension of ongoing auctions.

b) Preparation and shipment of bids by the entities. -Entities will make their requests through the terminal connected to the Banco de España for the procedures, schedules and dates set out in the TARGET2 -BE.

The requests must be firm, for a minimum amount and multiple of the amount that is established at any time. An upper limit may also be applied to the amount "bid" per entity or, where appropriate, a minimum amount to be awarded individually or a minimum percentage of the award. In addition, the requests must meet the following conditions:

If the auction is at a fixed interest rate, the entities will make a single request in which they will only indicate the effective amount.

If the auction is at variable interest rate, institutions may make one or more requests, up to a maximum of ten, indicating in each of them the effective amount and the interest rate to be expressed in two decimal places. In exceptional circumstances, a limit may be imposed on the number of bids submitted. In the issuance of ECB debt certificates to absorb liquidity, bids may be expressed in prices, in accordance with the provisions of the Eurosystem rules.

c) Award procedures in auctions (day D).

c1 Fixed-rate auction operations in euro.-The bids received from the institutions will be added and, if the sum exceeds the total amount to be awarded, a pro-rata will be made. In this case, a minimum quantity may be awarded to each participating entity.

c2 Auction operations at variable rate in euro. -In liquidity injection auctions, bids shall be ordered in a degressive manner by interest rates offered. Bids with the highest level will be met with priority. Bids with lower interest rates will be accepted successively until the total quantity to be awarded is exhausted. If at the lowest level accepted (marginal rate) the amount bid by the set of entities exceeds the volume to be awarded, it shall be prorated between bids made at the marginal rate.

In the award of liquidity drain auctions the bids are related in increasing order of interest rates offered (or in order of decreasing prices). Bids with the lowest level of interest rates (higher prices) are met with priority and bids with higher interest rates (lower prices) are successively accepted until the total amount to be drained is exhausted. If at the highest accepted level of interest rate (lowest price), the amount of the entity set exceeds the volume to be awarded, the amount of which is prorated between the bids made at the marginal rate.

In case of prorateo, a minimum amount may be set to be awarded to each participating entity, with at least one bid accepted.

In the "American" auctions, the accepted requests will be awarded to the requested interest rate. In the "Dutch" auctions, all accepted petitions will be awarded to the marginal rate.

d) Announcement of the results (day D). -The Banco de España will communicate the resolution of the auction for the usual channels. In addition, the Banco de España through the terminal will directly communicate the individual results of the award to all the entities that have submitted bids.

If the outcome of the auction contains erroneous information about any of these items, the ECB reserves the right to take the measures it deems appropriate to correct it.

e) Allocation of balances in liquidity injection operations (day D). -Entities shall transfer a sufficient amount of eligible assets, or cash, to settle (on the settlement date), or to ensure, up to the maturity of the transaction by means of the corresponding adjustment of the margin of guarantee, the amount awarded in an auction in a liquidity injection operation, or a sufficient amount of cash to settle the amount that has been awarded in an auction in the case of liquidity absorption operations.

The assignment will be done according to the following criteria:

The valuation prices that will be applied to the national securities in the various monetary regulatory operations will be made public, through the terminal and/or through the different governing bodies of the markets in which are negotiated. The prices to be applied to foreign securities will be obtained through the corresponding National Central Bank.

In the established time, institutions must allocate sufficient balances to cover their accepted requests. Requests made at higher interest rates should be completed first, with only the amount covered by each request admitted.

The entity that does not provide a sufficient amount of collateral or cash to support all requests accepted at the auctions may be suspended, in accordance with the provisions of these Clauses. General.

f) Settlement of transactions on the following day (day D + 1). -Charges and credits in securities accounts and payments module accounts, which come from the open market operations of standard auctions they shall normally settle on the day after the date of recruitment (D + 1) where TARGET2-BE and all relevant securities clearing and settlement systems are operational. However, the issuance of ECB debt certificates is settled on the second day of the trading date (D + 2) in which TARGET2-BE and all relevant securities clearing and settlement systems are operational.

2.1.2 Quick Auctions. -Quick auction procedures are identical to those of standard auctions except as regards their temporary development and the small number of entities acting as such. counterpart.

(a) Announcement of the auctions.-In the adjustment operations the auction call will normally be made public in advance, except for situations considered exceptional in accordance with the Eurosystem rules.

The announcement of quick auctions will follow the same procedures as in standard auctions. In the event that the quick tenders are not publicly announced in advance, the Banco de España will contact directly the counterparties selected for this type of transaction. In the event that they are publicly announced, the Banco de España will also be able to contact the selected entities directly.

b) Preparation and shipment of bids by the entities. -Entities will make their requests through the terminal connected to the Banco de España.

The requests will be firm and must meet the terms stated in the previous 2.1.1 (b) that regulates the standard auctions. In the case of variable-type currency swaps, bids will be made in "swaps points", which can be either a prize or a discount on the currency/Euro quotation.

(c) Procedures for the award of tenders in auctions.-The procedures for the award of fixed-rate and variable-rate auctions in euro are identical to those for standard tenders.

Fixed-rate currency swap auctions will be awarded for the procedure established for fixed-rate auctions in euros.

In the award of variable-rate currency swaps to inject liquidity, bids will be increasingly ordered from quoted award levels. Bids with the lower Swap quote will be met with priority, and the top Swap quotes will be accepted successively, until the total amount of the fixed currency to be awarded is exhausted. If, for the highest accepted Swap quotation, the amount of the entity set exceeds the volume to be awarded, the amount shall be prorated between the bids made to that quotation. In the award of variable-rate currency swaps to drain liquidity, bids will be ordered in a degressive manner from quoted award levels. Bids with the highest Swap quote will be met with priority, and the lower Swap quotes will be successively accepted, until the total amount of the fixed currency to be drained is exhausted. If, for the lowest accepted Swap quote, the amount of the entity set exceeds the volume to be awarded, the amount is prorated between the bids made at the marginal.

In the Swaps "American" auctions, the supported requests will be awarded to the requested Swap quote. In the "Dutch" auctions, all accepted requests will be awarded to the last accepted quotation.

d) Announcement of the results. -The announcement of the results of the quick auctions will be done in the same way as in the standard auctions.

e) Allocation of balances in injection operations. The allocation shall be made in accordance with the procedure described in standard tenders. The institutions shall indicate through the terminal connected to the Banco de España, the values to be delivered for each request accepted through Double or Sale transactions with the Repurchase Agreement, and which amount of the request will be covered by a loan or credit with collateral of pledged values.

f) Liquidation of transactions. -Charges and credits in securities accounts and payments module accounts shall be settled on the same day as the settlement of the auction, as set out in the rules and instructions of the TARGET2-BE and the corresponding securities clearing and settlement system that regulate this matter. The Banco de España may decide occasionally to apply other settlement dates for these transactions, in particular in maturity transactions and currency swaps.

2.1.3 Bilateral operations. -Normally these operations will not be publicly announced. The Banco de España shall contact one or more of the selected entities directly and decide at that time whether to carry out operations with those entities. However, the Banco de España may also execute simple transactions through stock exchanges or markets and market players. In such cases, the set of counterparties shall not be restricted a priori and the procedures to be followed shall be adapted to the market conventions where the debt instruments subject to the transactions are traded.

The results of bilateral operations may not be publicly announced in accordance with the provisions of the Eurosystem.

The remaining operational aspects such as allocation of balances in temporary injection operations, settlement of transactions, shall be carried out in accordance with the procedures laid down in the quick tenders.

2.2 Procedures on permanent facilities.

2.2.1 Marginal Credit Facility. The interest rate will be announced in advance by the Banco de España, and may be modified at any time, without having any effect before the next business day.

Entities will be able to access this facility, and should indicate the amount they need for the procedures, schedules and dates set out in the TARGET2-BE provisions.

In principle there will be no limit to the amount of funds that can be provided through the Marginal Credit Facility, however in exceptional circumstances access to an entity may be limited or suspended.

The remaining operational aspects such as balance allocation, settlement of transactions, shall be performed in accordance with the procedures set out in the Quick Auctions.

2.2.2 Deposit Facility. The interest rate will be announced in advance, and may be modified at any time, without having any effect before the next business day.

Entities will be able to access this facility, and must indicate the amount to deposit, by the procedures, schedules and dates set out in the TARGET2-BE provisions.

VI. Warranty assets

1. General aspects.

1.1 The criteria for asset selection and risk control measures will be those established by the Banco de España through the corresponding decisions that will be made known to the counterparty with the due notice.

1.2 The Banco de España will require adequate coverage of the risks arising from monetary policy operations that it has to make and the financing it provides to settlement systems through the provision of assets. to ensure that they comply with the technical and legal specifications communicated by the Banco de España.

1.3 The assets eligible for their contribution to guarantee the monetary policy operations and the financing of the settlement systems shall be disclosed in accordance with the means of dissemination established by the latter or by the Eurosystem. These assets are the only assets that the Banco de España will accept as collateral.

1.4 Counterparties will not be able to deliver and the Banco de España will not accept as collateral those assets issued or guaranteed by that counterparty or by another entity with which the previous one has close links. For this purpose, close links shall be understood to exist where the counterparty is linked to the issuer/debtor/guarantor of the eligible instrument in any of the following ways:

(a) The counterparty owns, directly or indirectly, through one or more companies, 20% or more of the issuer/debtor/guarant; or

(b) The issuer/debtor/guarantor holds, directly or indirectly, through one or more undertakings, 20% or more of the capital of the counterparty; or

(c) A third party holds more than 20% of the capital of the counterparty and more than 20% of the issuer/debtor/guarantor's capital, either directly or indirectly, through one or more undertakings.

This rule will not be applied in the assumptions of:

d) Close links between the counterparty and the public sector entities of the countries of the European Economic Area which have the right to collect taxes, or in the case of an income instrument it is guaranteed by a public sector entity in the countries of the European Economic Area which has such a right.

(e) Guaranteed bonds issued in accordance with the criteria set out in points 68 to 70 of Part 1 of Annex VI to Directive 2006 /48/EC of the European Parliament and of the Council of 14 June 2006 on access to the the activity of credit institutions and their financial year.

(f) Cases in which securities are protected by specific legal safeguards comparable to those of the instruments referred to in subparagraph (b) above, such as (i) guaranteed non-marketable debt instruments for retail mortgages (RMBs), which are not securities or (ii) structured collateralised bonds in which all the criteria set out in points 68 to 70 of Part 1 of Annex VI to Directive 2006 /48/EC are met, with the exception of limits to guaranteed loans from the guarantee asset set.

In addition, a counterparty cannot provide as collateral any securitisation bonus if the counterparty (or any other third party with which it has close links) provides: (1) currency hedging ("currency"). hedge ") to the securitisation bond by formalising with the issuer an exchange rate risk hedging transaction, or (2) liquidity support for an amount of 20% or more of the outstanding balance of the securitisation bonds.

Counterparties who provide securitization bonds with close links to the originator of the guarantee assets of such a bond should inform the Bank of Spain of any planned changes to such bonds as may potentially affect its credit quality, such as the alteration of the interest rate applicable to the bonds, changes in the swap arrangement, changes in the composition of the underlying loans not provided for in the relevant prospectus or changes in the payment ranking order. The Bank of Spain shall be notified at least one month in advance of any changes in the securitisation bonds that have been provided as collateral. In addition, the counterparty shall, at the time of the provision of securitisation bonds, provide information on any changes made in the previous six months. The Banco de España will not provide an opinion on the eligibility of the securitisation bonds prior to a modification.

1.5 Despite its eligibility, the Banco de España may not accept the following marketable or non-marketable assets for its contribution as collateral by counterparties:

(a) Debt instruments whose maturity date is very short; and

(b) debt instruments whose income flow (e.g. a coupon payment) occurs within a very short period of time.

2. Conditions relating to the admission of guarantee assets into monetary policy operations.

2.1 Eligible assets.-The assets that the Banco de España can accept as collateral for its operations are those included in the single framework of guarantee assets (also known as the Single List) prepared by the Eurosystem for use in credit operations. This framework consists of marketable and non-marketable assets proposed by the National Central Banks and which meet the common minimum requirements that the Eurosystem makes public. The ECB prepares, maintains and publishes a list of eligible marketable collateral assets, but not for non-marketable assets. The Eurosystem shall only disclose to counterparties its views on the eligibility of an asset as a collateral asset of the Eurosystem, in the case of previously issued marketable assets or non-marketable assets. (a) to be used as collateral. Opinions on the eligibility of assets prior to their issuance shall not be provided.

The Banco de España may accept guarantee assets registered or deposited in other Member States of the European Monetary Union, in accordance with the following number 2.2.

Guarantee assets, which meet the requirements set out in this Section VI, shall be disclosed by the means of dissemination established by the Bank of Spain, the European Central Bank or the Central Banks. Nationals belonging to the Eurosystem.

The Banco de España will provide counterparties with information that is precise regarding the legal instruments and procedures for carrying out these operations in each of the Member States. UME.

In order to implement monetary policy, and in particular for the control of compliance with the rules on the use of eligible assets as regards the regime of close links, the Eurosystem shares internally information on participation in the capital provided by the supervisory authorities for that purpose. Such information is subject to the same confidentiality rules as those supervisory authorities apply.

The Banco de España may at any time communicate the exclusion, limitation or suspension of assets that have previously been admitted to the list of guarantee assets. Such exclusion shall be justified by considerations of insufficient financial solvency. In particular, the exclusion, limitation or suspension of instruments issued or guaranteed by credit institutions (and those with close links to it) may be considered, where they are expressly excluded, limited or suspended. of their access to the Eurosystem's monetary policy operations for reasons of prudence.

Also, the Banco de España, acting in accordance with the Eurosystem's rules, reserves the right to determine, at any time and on the basis of any information it deems relevant, whether an issue, an issuer, a debtor or a guarantor has/n the level of solvency required in accordance with its provisions on the Eurosystem ' s collateral for monetary policy operations. As a result of this study, the Banco de España may refuse or limit the use of certain assets or apply additional cuts. These measures may also be applied to specific counterparties on prudential grounds and in particular if the credit quality of the counterparty in question appears to have a high correlation with credit quality. of the guarantee assets provided by the same. Where the refusal of a particular asset or a counterparty is based on information of a prudential nature, the use of such information shall be strictly in accordance with the principles of proportionality and necessity for the compliance with the Eurosystem ' s role in the implementation of monetary policy.

The Bank of Spain may also agree, in accordance with the rules on the Eurosystem, including the urgency procedure, the exclusion or suspension of certain assets admitted to the list of collateral assets, motivated by events that significantly and substantially alter the conditions of negotiation or transmissibility of those. They may also be excluded from the list of eligible assets, assets issued or guaranteed by institutions: (1) subject to freezing means of funds or to other measures restricting their use, imposed by the European Union of an agreement with the provisions of Article 75 of the Treaty or by a Member State, or (2) for which the Eurosystem has taken a decision to suspend, limit or exclude its access to its open market operations or facilities; permanent.

All discretionary measures referred to in the preceding paragraphs that are required to ensure prudent risk management shall be applied and calibrated in accordance with the principles of proportionality and non-discrimination. The discretionary measures to be taken in relation to a specific counterparty shall be duly justified.

2.2 Acceptance of marketable assets located outside of Spain.

2.2.1 The Banco de España may accept securities or other marketable assets registered or deposited in the name or on behalf of the counterparty in a centralized securities clearing and settlement system. that meets the following conditions:

Operating in another State of the European Union.

That is qualified for the clearing and settlement of securities for Eurosystem monetary policy operations.

The counterparty will not propose, nor is the Bank of Spain obliged to accept as collateral securities or assets other than their property or that of the guarantor, or who are not free from any work, condition or burden.

In relation to the provision of securities or marketable assets, the Central Bank of the Member State in which the centralised system of clearing and settlement of securities is operated (hereinafter: 'correspondent central bank' shall be taken into account and, where appropriate, on behalf of the Banco de España under the existing arrangements for the cross-border use of collateral in the Eurosystem.

The rules governing the constitution, execution and release of securities securities referred to in this 2.2 shall be, except for the capacity and representation of counterparties, those applicable in the State in which the centralised securities clearing and settlement system operates.

2.2.2 The cross-border use of collateral assets may also be made through the existing links between the various Eurosystem securities clearing and settlement systems.

2.3 Update of the assets contained in the list of collateral assets. -The contents of the list of guarantee assets will be updated daily. It may include securities whose issuance is scheduled for the following days.

3. Legal regime for the provision of guarantees.

3.1 Securities and assets located in Spain. -Values located in Spain eligible for operations guarantee may be pledged at the Banco de España, or be transmitted by means of sale (simple, double or with repurchase agreement), in accordance with the procedures approved for each case. These procedures shall be detailed in the relevant Technical Applications.

3.2 Non-marketable assets located in Spain. -Procedures relating to the constitution, execution and release of guarantees on assets located in Spain that are non-negotiable shall be determined by the Bank of Spain. shall be disclosed to the counterparties.

3.3 marketable assets located abroad.

3.3.1 Constitution of the guarantees by means of the corresponding model. -In the case of the securities referred to in this paragraph, the guarantee shall be constituted according to the procedures, requirements and formalities that are due the rules applicable to the market, register or central depositary in which they are traded, registered or deposited.

For the lodging of the guarantee in accordance with the provisions of the preceding paragraph, the Bank of Spain will intervene as a correspondent and/or custodian of the Banco de España, the National Central Bank that is required by the Bank to act in the quality of the product, as set out in the Eurosystem ' s provisions.

In addition, to this end, the counterparty is committed to:

(a) Transmit the ownership and/or possession of the securities subject to the guarantee to the Banco de España, either by transferring those securities from the account of the accredited or the guarantor as appropriate, to the account which indicate the correspondent Central Bank, either by means of the procedure which, where applicable, is applicable under the law of the country in which the securities are traded, registered or deposited.

(b) To make the notifications, to grant the powers, to issue the orders and to carry out the formalities and acts necessary for the perfection, validity, enforcement and enforceability of the guarantees in accordance with the laws of the country where the securities are traded, or are deposited or registered and of the Spanish State.

Once the property has been transferred either to the possession or both of the securities in accordance with the provisions of the preceding paragraph, the Central Bank shall constitute the security in accordance with the provisions of the legislation of the State in which the securities are traded, registered or deposited.

When the Banco de España receives the notification from the Central Bank, confirming that the guarantee is valid and enforceable in accordance with the law of the place where the securities are traded, registered or deposited, shall pay to the credited the amount of the guaranteed financing.

The particularities of the cross-border use by the Banco de España of assets located abroad derived from the specific legal modality of formalization will be collected in the documents the contractual partner with the Banco de España.

3.3.2 Release of the guarantees formed by the corresponding model. -To proceed to the release of the guarantees referred to in the 2.2 of this Section VI, the counterparty is committed to to carry out any act, and to provide any necessary or appropriate documents in their case.

3.3.3 Conditions applicable to the assets which are the subject of a link between the different securities clearing and settlement systems. -In the case of the securities referred to in this paragraph, the security shall be lodged according to the procedures, requirements and formalities set out in section 3.1

For the lodging of the guarantee in accordance with the provisions of the preceding paragraph, the Bank of Spain shall intervene as a contractor with the counterparty providing such security, while the securities are registered in a duly authorised central depositary.

3.4 Non-marketable assets located outside Spain. -Without prejudice, where appropriate, to the fulfilment of the administrative requirements applicable under Spanish law, the use of assets as collateral Negotiable proposed by other National Central Banks shall be governed by its constitution, execution and release by the provisions that the National Central Bank may have proposed to include in the list of assets. (b) corresponding to the corresponding amount, which shall be made available to the counterparty by the Banco de España.

4. Valuation of the guarantee assets located in Spain. -The principles of valuation and use of cuts and margins that are regulated in numbers 4, 5, 6, 7 and 8 of this Section VI will be applicable regardless of the Warranty on used warranty.

Assets in collateral, whatever the market or markets in which they are negotiable, and the type or class of operation to which they are intended shall be valued in accordance with the following criteria:

4.1 Fixed income securities.

4.1.1 For each marketable security asset, the Eurosystem defines the most representative price it uses in the calculation of its market value.

4.1.2 The value of a negotiable asset is calculated on the basis of the most representative price on the business day prior to the valuation date. In the absence of a representative price for a given asset on the business day preceding the valuation date, the Eurosystem defines a theoretical price

4.2 Other assets. -If the eligible assets are not listed on any market, appropriate valuation rules shall be established, which shall be disclosed to the counterparties by the counterparty. Bank of Spain through the corresponding Technical Applications.

4.3 Review of collateral valuation. -Market Values calculated according to the criteria set out in points 4.1 and 4.2 above, will be reviewed periodically using the same rules.

5. Risk control measures.-The Banco de España shall apply to the assets provided by guarantee the risk control measures that are established at any time, in order to cover against the risk arising from the possible losses (a) a financial contribution to be made if such guarantees had to be executed due to a default of the counterparty. The Eurosystem applies specific risk control measures in accordance with the types of collateral offered by counterparties. The ECB determines the appropriate risk control measures for both marketable and non-marketable collateral assets. Risk control measures are broadly harmonised in the euro area and ensure transparent, non-discriminatory and consistent conditions for each type of asset. The application of these risk control measures shall be governed by the provisions of the sixth provision of Law 13/1994, of 1 June, of Autonomy of the Banco de España.

The Eurosystem reserves the right to apply additional risk control measures, if they are required to ensure adequate protection for the Eurosystem, in accordance with the provisions of Article 18. of the Statute of the ESCB and of the ECB. These risk control measures, which must be applied in a consistent, transparent and non-discriminatory manner, may also be applied at the level of individual counterparties provided that this is necessary to ensure that the protection.

The risk control measures applied by the Banco de España are as follows:

Cuts to asset valuation.

Adjustments by valuation or variation margins.

Limits in relation to the use of simple credit institution bonds.

6. Cuts to the valuation of guarantees located in Spain.

6.1 The Banco de España will apply a cut to the price of the guarantee assets to determine the amount guaranteed by those assets, which will be a percentage on the same.

6.2 The applicable cuts, depending on the type of asset provided, will be the ones provided by the Banco de España, with the residual life of the guarantee asset being the main factor considered for the purposes of establishing the cuts.

6.3 The applicable cuts will be made known by the Banco de España to counterparties through Technical Application.

7. "valuation", "margins", "cuts" and other risk control measures for assets located abroad.

7.1 In the case of foreign-located guarantee assets, usable through the correspondent model, they will be valued according to the price that the Central Bank that proposed the inclusion of the assets in question.

The margins, cuts and other risk control measures applicable to securities or other assets guarantees, when they are located outside Spain, and are usable through the correspondent model, shall be The Central Correspondents Bank will be established in this regard. Those risk control measures for the securities and assets indicated shall be disclosed to the counterparty and applied by the Banco de España.

7.2 Where assets are usable by means of links between the Eurosystem ' s securities clearing and settlement systems, the criteria for the valuation of the assets, margins, cuts and other control measures Applicable risks shall be fixed in accordance with the procedures laid down in the headings 4, 5, 6 and 8 of this Clause.

8. Adjustments for the valuation of guarantees (margin of variation).-The Banco de España will require the institutions to provide greater guarantees in case the revision of its current value, after deduction of the cuts, is a less than is necessary to ensure current operations. It will either release or make available to entities the excess that in certain cases may result from an upward revision.

This system of reassurances and reassurances will be governed by the rules detailed in the corresponding Technical Application.

8.1 Pigned Values.

8.1.1 The Banco de España will periodically verify that the Adjusted Market Value calculated for the set of pledged assets provides sufficient coverage to all guaranteed operations, including interest ran from the same and applied the initial margin (in case the latter exists).

8.1.2 If the Total Adjusted Market Value of the guarantees, in the terms indicated in the previous 8.1.1 number, is insufficient, the entity affected by that circumstance shall provide on the same date new securities in guarantee, so that the new total effective value of these, once the corresponding cuts are applied, guarantees the amount of all the operations.

8.1.3 Alternatively, the entity may make the necessary coverage by cash contribution, which will be charged to its account.

The cash to be charged will be determined at any time in accordance with the rules for the risk control framework established for the Eurosystem, which will be released and applied by the Banco de España. The calculation procedures applicable to this effect are detailed in the corresponding Technical Application.

8.1.4 Otherwise, automatically, the limit of the funding granted will be considered reduced, without prejudice to the provisions of Clause VII of these "General Clauses".

8.1.5 In the event that the Adjusted Market Value of the guarantees presents an increase compared to the one calculated in the previous revision, the Banco de España will pay into the account that the accredited cash will indicate to him, provided that the cash contribution has been previously required for the implementation of valuation adjustments on the same transactions. In any event, the return of such cash charged by the Banco de España shall proceed, when the cancellation of the live credit operations occurs.

If the Bank of Spain does not pay the amount established in the preceding paragraph to the credited for not having produced prior cash contributions by the guarantor and/or credited, as a result of adjustments due to differences the excess assets shall be made available to the institution, which may withdraw them or apply for additional financing in accordance with the provisions of these General Clauses.

8.1.6 The Banco de España will be able to establish a guarantee replacement threshold. Such a replacement threshold shall act as a lower limit for the purposes of applying the valuation difference adjustments, so that if the Adjusted Market Value of the collateral after the revision is greater than that threshold of the replacement, no new guarantees will be required. These thresholds shall be disclosed by the Banco de España to counterparties by means of a Technical Application.

8.2 Value-to-Sale and Purchase-Sales-to-Buy-to-Deal Values with Repurchase Agreement.

8.2.1 These values are individually assigned to each operation and constitute the object of the purchases through which funding is provided.

8.2.2 The Banco de España will calculate daily the adjusted market value of the securities to be sold in each temporary liquidity injection operation according to the detailed rules in numbers 4, 5, 6 and 7 of this Clause.

8.2.3 If the Adjusted Market Value obtained for the assets subject to a particular transaction was insufficient for the coverage of the initially injected cash, including interest run and applied the initial margin (if there is a), the entity shall provide cash in sufficient quantity to cover the difference between the two. Such cash shall be charged to the entity's PM account.

The cash to be charged will be determined at any time in accordance with the rules for the risk control framework established for the Eurosystem, which will be released and applied by the Banco de España. The calculation procedures applicable to this effect are detailed in the corresponding Technical Application.

8.2.4 Similarly, if the Adjusted Market Value of the assets is greater than the amount necessary to cover the amount due, plus the interest run and the initial margin (if any), the Banco de España will pay the entity in its account an amount equivalent to the excess, provided that the excess exceeds the threshold established in accordance with the provisions of the 8.2.6 of this Clause.

The cash to be paid will be determined at any time in accordance with the rules for the risk control framework established for the Eurosystem, which will be released and applied by the Banco de España. The calculation procedures applicable for this purpose shall be detailed in the relevant Technical Application.

8.2.5 At each date when the revision of the Adjusted Market Value of the assets subject to each transaction is different from the previously calculated one, the Banco de España will proceed, as appropriate, taking into account, where applicable, the thresholds established, the credit or debit account of the entity of the resulting cash, calculated by difference. In any event, the cash received by adjustments or the recovery of the facilitated by these adjustments shall be made when the cancellation of each operation of this nature occurs, in accordance with the agreed terms.

8.2.6 The Banco de España may establish a settlement threshold for valuation adjustments. This threshold shall act as an upper and lower limit or threshold for the purpose of determining the application of the daily valuation adjustments. In such a way that if the adjusted market value of the goods being the object of the transaction is understood between the two limits, no requirement or contribution of cash shall be made. These thresholds shall be disclosed by the Banco de España to counterparties by means of a Technical Application.

9. Remuneration of cash balances transferred by the application of securities valuation adjustments.

9.1 Cash balances transferred by the application of valuation adjustments shall be remunerated under the same conditions, either in favour of the institutions or the Banco de España.

9.2 The Banco de España will calculate the liquidations with a reference interest rate identical to the marginal rate of the Bank of Spain's main refinancing operations.

9.3 The applicable rules for the settlement of the remuneration referred to in this paragraph will be developed in the corresponding Technical Application.

10. Limits in relation to the use of simple bonds of credit institutions. -counterparties may only provide as collateral assets issued by a credit institution or by any entity with which the institution of credit institutions is a credit institution. credit maintain close links in the terms referred to in paragraph 1.4 of the previous Section VI, as long as the value assigned to such bonds by the Eurosystem following the application of the corresponding cuts does not exceed 10% of the total value of the the collateral provided by that counterparty after the cuts. This limit will not apply in the following scenarios:

Assets Secured by a Public Sector Entity with Power to Raise Taxes; and

assets whose value after cuts does not exceed EUR 50 million.

In the event of a merger or the establishment of close links (in the terms referred to above) between two or more issuers of single credit institutions, these issuers will only have the consideration of a single credit institution. the issuer group for the purposes of this limit only up to one year after the date of the merger or the establishment of the close link.

11. Other risk control measures. -Regardless of the numbers 4, 5, 6, 7, 8 and 10 of this Section VI, other risk control measures that the Banco de España may adopt, at any time to ensure an adequate protection in accordance with Article 18 of the Statute of the ESCB and of the ECB in relation to its monetary policy operations are: the application of initial margins; the imposition of other quantitative limits on the operation of the assets of certain issuers or with assets against certain debtors or guarantors other than those applicable to simple credit institutions ' bonds; the application of additional cuts; the requirement for additional guarantees to those normally required; or the exclusion of certain specific assets or certain counterparties (such as and as indicated in the last two indents of paragraph 2.1 of this Section VI).

12. Acceptance of non-euro-denominated assets in contingency situations.-In certain situations, the Eurosystem may decide to accept as collateral certain types of marketable debt instruments issued by governments. central banks of one or more G10 States which do not belong to the euro area in their national currencies. Where this decision is taken, the applicable criteria shall be laid down and the counterparties shall be notified of the procedures to be followed for the selection and contribution of foreign assets, including sources and principles of valuation of the same, risk control measures and settlement procedures.

Without prejudice to the provisions of paragraph 2 of this Section, these assets may be deposited/registered (issued), held and settled outside the European Economic Area and, as indicated above, denominated in different currencies of the euro. Such assets shall be the property of the counterparty that provides them. Counterparties which are branches of credit institutions established outside the European Economic Area or Switzerland shall not be able to provide these assets as collateral.

VII. Default assumptions

1. The counterparty shall be deemed to have failed to fulfil its obligations under these General Clauses when any of the following conditions are met:

(a) Adoption, within the framework of the creditor's competition of the counterparty, of the self-opening settlement of the counterparty.

(b) Adoption under the legislation of another Member State of the European Union of a measure of a universal nature provided for in that legislation to decide the settlement of the counterparty.

(c) The counterparty is subject to the freezing of funds or other measures imposed by the European Union in accordance with Article 75 of the Treaty, which restrict its ability to make use of its funds.

The default assumptions collected in this number 1 will produce the effects set forth in General VIII Clause automatically, without prior notification.

2. The Banco de España may, after written communication to the counterparty, declare it incurs an alleged breach of the obligations arising from these General Clauses, inter alia, for the following reasons:

(a) Admissions to the application for the competition of creditors of the counterparty or the declaration of the competition of creditors of the counterparty.

b) Designation of interventors or interim administrators adopted pursuant to Articles 31 to 38, 59 or 62 of Law 26/1988, of July 29, of Discipline and Intervention of Credit Entities.

(c) Adoption under the legislation of another Member State of the European Union of a measure of a universal nature provided for in that legislation to decide the reorganisation of the counterparty.

(d) A written statement by the counterparty recognizing either its inability to pay all or part of its debts or to meet its obligations arising from monetary policy operations, either the the existence of a general voluntary agreement or agreed with its creditors, or that the counterparty is, or is considered, insolvent or unable to pay its debts.

e) The adoption of a preliminary procedural act to a decision of those referred to in numbers 1, 2 (a), 2 (b) and 2 (c).

(f) the incorrectness or untruth of the proxy powers granted by the counterparty, or of their pre-contractual, contractual statements, or which are to be made by the counterparty in accordance with the provisions of the applicable legal.

g) The revocation or suspension of the authorisation held by the counterparty to carry out its activity in accordance with the national legislation transposing the Directive of the European Parliament and of the Council 2006 /48/EC, 14 June, and the Investment Services Directive (Directive of the European Parliament and of the Council 2004 /39/EC of 21 April) or those which may replace them.

(h) The suspension in the condition of membership or expulsion of the counterparty from any payment system or securities settlement by means of which monetary policy operations, or any other payment, are made. the system of clearing and settlement of securities of the Eurosystem through which monetary policy operations are settled.

(i) Adoption in respect of the counterparty of a national measure taken under Articles 30, 31, 33 and 34 of the Directive of the European Parliament and of the Council 2006 /48/EC of 14 June.

j) Failure or compliance by the counterparty to the rules relating to the risk control measures referred to in General Clause VI of these General Clauses.

(k) The fact that the counterparty or any of its branches incurs an alleged breach of any agreement, contract or transaction concluded between that counterparty or its branches and a Member of the Eurosystem for the conduct of monetary policy operations, provided that the other member of the Eurosystem has exercised its right to early resolve any transaction within the framework of that agreement on the basis of the failure.

(l) The lack of referral by the counterparty of the information requested to it by the Banco de España in relation to the monetary policy operations, as well as the non-referral of relevant information that it causes serious consequences for the Banco de España.

m) The concurrence of an alleged non-compliance similar to those set out in these General Clauses, in the framework of an agreement for the management of foreign reserves or own funds, concluded by the entity counterpart with any member of the Eurosystem.

n) The default or defective performance by the counterparty of the Eurosystem rules relating to the use of the collateral.

n) When the counterparty experiences an alteration in its assets, economic or financial situation, which may affect its ability to comply with the obligations arising from these General Clauses, judgment of the Bank, and in particular in the cases of business segregation, division, merger or absorption, allocation of all or part of its assets to another entity, legal dissolution, administrative expropriation, freezing of funds, embargo, seizure, seizure, confiscation of all or part of their property or the holding of any other procedure aimed at protecting the public interest or the rights of its creditors and falls in the official register in which the counterparty is registered, obliging the latter to notify the Bank of Spain of the immediately, any of these situations if they occur.

or) Where the counterparty is subject to the freezing of funds or other measures imposed by a Member State, which restrict its ability to make use of its funds.

p) The occurrence of any other assumption that may jeopardize the counterparty's compliance with the obligations arising out of these General Clauses or any other legal relationship established between that counterparty and any other Eurosystem central bank.

q) For the failure or defective performance of any other obligation arising out of these General Clauses, provided that, where possible, the counterparty does not proceed to the remedy. within the maximum period of 30 days, since it would have been required by the Banco de España for the performance of such a cure.

The default assumptions listed in this number 2 will produce the effects set out in General Section VIII only after the notification referred to in the second paragraph of that Clause. In that notification, the Banco de España may grant the counterparty a grace period, which shall not exceed three working days, to remedy the non-compliance notified.

3. Other assumptions of non-compliance.-The counterparty shall also be deemed to have failed to fulfil its obligations under these General Clauses when:

3.1 The counterparty does not comply with the provisions laid down by the Banco de España in relation to the auctions and bilateral transactions.-It will be considered, in particular, that the counterparty has (a) not in respect of the provisions laid down by the Banco de España in relation to the auctions where the counterparty does not transfer a sufficient amount of collateral or cash (where applicable as regards the adjustment) of the margins) to settle on the settlement dates, or to guarantee, to the date of maturity of the transaction by the corresponding adjustments, the amount awarded in a liquidity injection operation, or if it does not transfer a sufficient amount of cash to settle the amount awarded in the case of transactions Liquidity absorption.

In addition, in particular, the counterparty has failed to comply with the provisions laid down by the Banco de España in relation to bilateral transactions when the counterparty does not transfer a sufficient amount of collateral or a sufficient amount of cash to settle the amount agreed upon in the transaction, or if it does not warrant a pending bilateral transaction at any time up to the date of its maturity by adjusting the corresponding margins.

3.2 The counterparty fails to comply with the closing day procedures or the conditions of access to the marginal lending facility. -It will be considered, singularly, that there has been unauthorised access to the marginal facility. credit when:

3.2.1 The counterparty accesses the marginal lending facility for having a negative balance on its PM account at the end of the day, but does not meet the conditions of access to such facility, or

3.2.2 The counterparty has a negative intraday credit position, greater than its limit of access to the marginal lending facility.

3.3 The counterparty is in breach of the provisions laid down by the Banco de España on the use of collateral.

It will be considered, in particular, that the counterparty has failed to comply with the provisions laid down by the Banco de España on the use of collateral in the following cases:

3.3.1 When the counterparty uses to ensure its monetary policy operations with the Eurosystem collateral issued or guaranteed by the counterparty itself.

3.3.2 When the counterparty uses collateral to ensure its monetary policy operations with the Eurosystem collateral issued or guaranteed by a third party with which the counterparty has close links. For these purposes, the provisions of Section VI of Section VI of these General Clauses shall be construed as close links.

3.3.3 When the counterparty uses to ensure its non-eligible collateral or collateral assets that are no longer eligible as collateral for such transactions, the counterparty shall use the following: The Bank of Spain or the Eurosystem shall be subject to the rules in force.

3.3.4 When you have provided information that impairs the value of the collateral asset, such as information about the outstanding amount of credit rights used that is false or obsolete.

Without prejudice to the above paragraph:

3.4 If the asset cannot be used as a guarantee of monetary policy operations by the establishment of a "close link" between the counterparty and the issuer, debtor or guarantor of the asset, only consider that the counterparty has failed to comply with the provisions laid down by the Banco de España or the Eurosystem on the use of collateral when the asset is not withdrawn after 20 working days have elapsed to be counted from the date of establishment of the "close link".

3.5 If the asset cannot be used as collateral for monetary policy operations in other circumstances, such as that it has been removed from the Eurosystem ' s list of collateral, it shall only be considered as collateral. the counterparty has failed to comply with the provisions laid down by the Banco de España or the Eurosystem on the use of collateral when the asset has not been withdrawn within 20 working days from the date of the the day on which the Bank of Spain has removed it from the list of collateral assets of the Eurosystem.

VIII. Effects arising from the assumptions of non-compliance

1. The existence of any of the cases of non-compliance referred to in paragraph 1 of the preceding General Clause VII shall automatically determine the anticipated maturity of the monetary policy operations concluded in accordance with these General clauses to the date on which the alleged default (Advance Due Date) took place.

2. The existence of any of the cases of non-compliance referred to in paragraph 2 of the preceding General Clause VII, and the receipt by the counterparty of the notification of the Banco de España declaring it incurs in the same, determine the anticipation of the maturity of the monetary policy operations determined by the Banco de España from among those agreed in accordance with these General Clauses to the date (Date of Anticipated Maturity) in which the Bank of Spain The Bank of Spain has granted the Bank of Spain to the Bank of Spain for the period of grace. For the purposes of this paragraph, it shall be understood that the receipt of the notification has taken place when the Banco de España has communicated the notification by the means in force for the receipt of communications from the Banco de España or by delivery at the address of the counterparty.

The anticipated maturity of the monetary policy operations concluded under its protection will also determine the enforceability of any amount of cash to which either party is required to pay. a consequence of the adjustment measures for valuation differences referred to in General Clause VI of these General Clauses in accordance with the provisions of the relevant framework contract or specific conditions which in each case The case may be regulated by the various monetary policy operations.

Produced the anticipated maturity of the monetary policy operations concluded in accordance with these General Clauses, the parties agree to effect the joint settlement of those monetary policy operations which are to be settled on the Anticipated Maturity Date established in accordance with the first and second subparagraphs of this paragraph. To that end, the Banco de España shall, on the Anticipated Maturity Date referred to above, carry out the calculation of the amounts due to each party in accordance with the rules established for each type of Monetary Policy Operation and immediately require the counterparty to pay the net balance that would be in favour of the Banco de España, or to settle the payment resulting, where appropriate, in favour of the counterparty.

Any amount that the counterparty owes to the Banco de España as a result of the non-compliance with the obligations arising out of the operations regulated by these General Clauses will become in favour of the Bank of Spain. Spain since the day when the non-compliance occurred a moratory interest equal to the official interest rate of the marginal lending facility, increased by two percent.

The above paragraph is understood to be in default of the express contractual clause applicable to each operation.

3. The existence of any of the assumptions contained in the preceding Section VII, No 3, without prejudice to the right of the Banco de España to require the fulfilment of the unfulfilled obligations referred to in that number and the indemnities for damages which, according to the Act, shall give rise to one or more of the following effects:

3.1 In the case referred to in Section 3.1 of Section VII, the following effects will occur:

3.1.1 In the event that the counterparty does not provide sufficient collateral for the settlement of its obligations, only the share of the bid awarded to the counterparty is settled. was effectively covered by the above mentioned collateral assets. In this case, delays in the liquidation of the operation will not be allowed.

3.1.2 For the first and second non-compliances occurring within a period of 12 months, a pecuniary penalty equivalent to the result of applying the interest rate of the marginal lending facility shall apply. in force at the time of the start of the default plus 2,5 percentage points, on the amount corresponding to the collateral or cash assets that the counterparty is unable to deliver or liquidate, and multiplied by the coefficient X/360, with X being the number of calendar days, with a maximum of seven, during which the The counterparty has not been able to guarantee or contribute the amount awarded during the expiry of an operation. For cases where, once the above calculation has been made, an amount to be paid less than EUR 500, a minimum penalty of EUR 500 shall apply.

3.1.3 For the third and successive non-compliances occurring within a 12-month period, in addition to the penalty provided for in the preceding paragraph, a suspension of the defaulting counterparty shall apply. access to open market operations of the same type and executed under the same procedure. The suspension shall be applied according to the following scale:

3.1.3.1 One month of suspension, where the amount not delivered of collateral or cash is more than 40% of the total collateral or cash assets that should have been contributed.

3.1.3.2 Two months of suspension, where the quantity referred to in the previous paragraph is between 40% and 80%.

3.1.3.3 Three months of suspension, when that quantity is between 80% and 100%.

3.2 In the case referred to in Section VII (3.2), the counterparty shall be obliged to pay a pecuniary penalty calculated as follows:

3.2.1 For the first non-compliance, the pecuniary penalty shall be equivalent to the result of applying the interest rate of the marginal lending facility in force at the beginning of the default plus 5 percentage points, on the amount corresponding to the unauthorised access to the marginal lending facility.

3.2.2 In the case of successive defaults, the penalising interest rate will be increased by 2.5 points each time a new non-compliance occurs within a period of 12 months, the penalty being calculated on the basis of the amount corresponding to the unauthorized access to the marginal lending facility. For cases where, once the above calculation has been made, it is an amount to be paid less than EUR 500, it shall apply a minimum penalty of EUR 500.

3.3 In the case referred to in Section VII 3.3:

3.3.1 In the first and second non-compliances that occur within a period of 12 months, the counterparty must pay a pecuniary penalty equivalent to the result of applying a penalty interest rate of an additional 2,5 percentage points at the interest rate of the marginal lending facility in force at the time the default is initiated, on the basis of the collateral that is not eligible (or the counterparty (a) may not be used), whether they are provided by the counterparty to the Banco de España or not withdrawn by the same on or before the start of the eighth calendar day following the occurrence of the fact that the assets are no longer eligible as collateral or that the entity cannot use them, multiplied by the coefficient X/360, where X is the number of calendar days, with a maximum of seven, during which the counterparty fails to comply with the rules on the use of collateral. For cases where, once the above calculation has been made, it is an amount to be paid less than EUR 500, it shall apply a minimum penalty of EUR 500.

3.3.2 In the third and successive non-compliance occurring within a period of 12 months, in addition to the penalty provided for in the preceding paragraph, the defaulting counterparty shall be suspended from access to the next open market operation.

3.4 In exceptional cases, where the seriousness of the alleged non-compliance so requires, and taking particular account of the amounts involved and the frequency or duration of the defaults, the Banco de España may agree, together with the imposition of a pecuniary penalty, the suspension of the counterparty for monetary policy operations for a period of three months.

3.5 The Banco de España may adopt the suspension measures in respect of branches in Spain of monetary policy counterparties established in other member states that have been suspended.

3.6 The amount of the pecuniary penalty shall be rounded to the nearest cent. The valuation of each specific default shall take into account the justifications that the counterparty has reported in relation to the counterparty.

4. The Bank of Spain may exclude, limit or suspend the counterparty from access to monetary policy operations (open market operations and permanent facilities) referred to in these General Clauses by the reasons for prudence or in the event of a case of non-compliance referred to in Section VII above. These measures shall be duly justified and shall be applied and calibrated in accordance with the principles of proportionality and non-discrimination.

IX. Force majeure

The Banco de España assumes no liability for the damages that counterparties in monetary policy operations may suffer as a result of acts or events constituting force major, including strikes (whether personal or not), wars, lockout, social unrest, fire, flooding, fuel shortages, electrical power, impossibility of transport, disaster affecting the availability of resources Computer, acts or resolutions of public authorities or any other cause independent of the will of the Banco de España.

X. Applicable law and jurisdiction

The contracting parties to monetary policy operations are subject to these General Clauses, with the applicable law being the Spanish law. For all the actions and claims that may be derived from them, the Courts and Tribunals of Madrid (capital) shall be competent, renouncing both the Banco de España and the counterparty to any other jurisdiction that may correspond to them, and agreed as a place of the fulfilment of the obligations of the Bank of Spain's domicile in the 50th of Alcala Street, Madrid.

XI. Address

For all the purposes of notifications and requirements, the address of the counterparty is considered to be the address of the Official Records held by the Banco de España.

XII. Modification

The present General Clauses may be modified at any time by the Executive Board of the Bank of Spain and any agreed modifications will be applicable to counterparties as soon as the Bank of Spain Spain would have notified them.

The counterparty may not claim to be unaware of these General Clauses or their modifications once they have been made public by the Banco de España.