The National Government created a temporary compulsory investment for banks and credit institutions in internal public debt securities called Títulos de Deuda Solidaria (TDS). The TDS will be dematerialized instruments administered by the Central Bank, which will be freely negotiable and will have an initial term of one (1) year counted upon their issuance, which may be extended for equal terms at the request of the Ministry of Finance and Public credit until 2029.
The TDS will have a return for investors that reflects the market conditions of short-term domestic public debt securities. However, the amount and other conditions of the issuance and placement of the TDS will be further established by the National Government.
In accordance with the provisions of the new regulation, credit institutions will be required to acquire the TDS in the following percentages, which must be accredited before the Superintendence of Finance:
- Up to three percent (3%) of the total deposits subject to reserve requirements of the obligated subjects, previously deducted the reserve requirement, based on the financial statements as of March 31, 2020.
- Up to one percent (1%) of the total deposits and liabilities subject to reserve requirements of obligors, previously deducted the reserve, based on the financial statements as of March 31, 2020, including those obligations with a reserve percentage of zero percent (0%).
The resources generated by the TDS issuance will be incorporated into the budget as an additional source of money of the Emergency Mitigation Fund -FOME.