Reforms to Policies for Administration of Contingent Assets of the INJUPEMP

According to the Law of the Institute of Retirements and Pensions of Employees and Officials of the Executive Branch, the bodies of planning, direction and administration of INJUPEMP are the Assembly of Participants and Contributors and the Board of Specialists. - CONSIDERING (2): That according to article 18, numerals 5 and 23, of the INJUPEMP Law, it is the responsibility of the Board of Specialists to approve the processes and present to the Assembly the regulations, policies, strategies and objectives necessary for the proper performance of the Institute and the proper management of risks. - CONSIDERING (3): That in accordance with article 9, numeral 6 of the Institute Law, it is the responsibility of the Assembly to approve, in accordance with Law, the regulations, policies, strategies, objectives and administrative structure necessary to guarantee an efficient institutional development and proper technical-administrative functioning of INJUPEMP, which shall be presented to it by the Board, subject to a favorable opinion from the Commission. - CONSIDERING (4): That the interim Executive Director of the Institute, who in accordance with the second paragraph of article 125 of the INJUPEMP Law performs the functions and responsibilities corresponding to the Board of Specialists, on September 23, 2020 approved the Project of Reforms to the Policies for the Administration of Eventual Assets of the Institute through Resolution DI. No. 206-2020, which was sent to the National Commission of Banks and Insurance (CNBS) for its approval. - CONSIDERING (5): That the National Commission of Banks and Insurance approved the Project of Reforms to the Policies for the Administration of Eventual Assets of the Institute, as shown in Resolution SVP No.016/13-01-2021, contained in the Minutes of Session No.1467 dated January thirteen of the year 2021. - CONSIDERING (6): That on this date the interim Executive Direction of the Institute requested from the Assembly the approval of the Reforms to the Policies for the Administration of Eventual Assets of the Institute; THEREFORE: based on the foregoing considerandos and legal grounds, in use of its powers, by unanimity, RESOLVES: FIRST.- To approve the following: "REFORMS TO THE POLICIES FOR THE ADMINISTRATION OF EVENTUAL ASSETS OF THE NATIONAL INSTITUTE OF RETIREMENTS AND PENSIONS OF EMPLOYEES AND OFFICIALS OF THE EXECUTIVE BRANCH (INJUPEMP). CHAPTER I GENERAL PROVISIONS

Purpose. - The present policies have the purpose of establishing the procedures to be followed for the adjudication, registration, accounting, administration and sale of assets of movable and immovable property, received in payment or adjudication through judicial auction, for the recovery of obligations of affiliates or other debtors and identified as eventual assets.

Definitions. - For the purposes of the present Policies, the following shall be understood as: Eventual Assets of INJUPEMP. - Those are movable and immovable property that the National Institute of Retirements and Pensions of Employees and Officials of the Executive Branch (INJUPEMP) receives for the purpose of debt recovery either through payment in kind or adjudication via Judicial Auction to cover all or part of the balance of a debt. Adjudication via Judicial Auction or Sale. - It consists of a legal instrument of payment, by which after the legal procedure has been exhausted, the corresponding court issues a resolution of auction or sale in favor of the Plaintiff, proceeding to adjudicate the property for a predetermined value and concluding said adjudication with the Certification of the Minutes of the Auction Hearing, duly registered in the Public Registry of the corresponding locality in favor of INJUPEMP. Lease. - A contract in which both parties reciprocally obligate themselves, one to grant the use of a property and the other to pay for it a determined price as rent for the use of the immovable property. Immovable Property. - Immovables or real estate are things that cannot be transported from one place to another, such as land and those that are permanently attached to it, such as dwellings. Movable Property. - Those that can be transported from one place to another, either by moving from one place to another, either by moving themselves, or by moving only through an external force. Committee of Eventual Assets. - It is the technical body in charge of proposing to the Board of Specialists the disposal or lease of the eventual assets of INJUPEMP and ensuring compliance with the present Policies for the Administration of Eventual Assets. CNBS. - National Commission of Banks and Insurance. Payment in Kind. - It is the cession of an immovable property made by the borrower or debtor in favor of INJUPEMP, for the purpose of complying with the total or partial payment of a loan or obligation, through a title of transfer of ownership, for a value appraised by mutual agreement between the parties. Board of Specialists: Superior Body of Administration and Execution of the Institute. Disposal or Sale. - The act by which the ownership of a property is transferred. INJUPEMP and/or INSTITUTE. - The National Institute of Retirements and Pensions of Employees and Officials of the Executive Branch (INJUPEMP). Related Party. - Natural person who maintains a relationship with INJUPEMP, and who also maintains indirect relations with each other, by executive management, by kinship or conjugal relationship within the second degree of consanguinity and first degree of affinity with the members of the Assembly of Participants and Contributors, Board of Specialists and the members of the Committee of Eventual Assets. (It is established as Supplementary Norm, Article 2, subsection q) and other applicable provisions of the Regulation for Credit Operations of Financial Institutions with Related Parties issued by the Central Bank of Honduras. Participant: Any person who by virtue of Law is protected by the Institute or maintains expectations of re-entry. The concept of participant is included for the purposes of these Policies, that which is in the condition of active, suspended, voluntary and retired. Base Price: It is the minimum price for which the eventual asset should be offered for sale in accordance with its market value, determined through an appraisal or technical valuation accepted for this purpose. Auction: It is the final stage of the adjudication of the property. Resale: Sale that the Institute makes of an immovable property to the same participant, to whom it had been sold previously, with which it recovers the price paid. Public Auction: Process by which INJUPEMP submits for sale and/or lease the eventual assets of the Institute, through free competition among buyers or lessees who have demonstrated the lawful origin of the funds, awarding the property to whoever offers the highest price above the stipulated base price. Adjudication Value by Payment in Kind or via Judicial Auction: It is the value for which INJUPEMP acquired the property, through payment in kind or judicial auction. Sale Value through Public Auction: It is the value of the base price for which INJUPEMP puts a property registered as an eventual asset up for sale. Book Value: It is the value for which a property is recorded in the accounting books of the Institute. Appraiser: Natural or legal person, whose activity is to appraise movable and immovable assets and guarantees granted by a debtor or applicant for credit, in favor of supervised institutions, which must be registered in the registry that for this purpose is kept by the Commission. CHAPTER II RESOLUTIVE BODIES. - Administrative Instances

Limits of Competence of the Resolutive Bodies. - The sale through public auction and temporary lease of the eventual assets of INJUPEMP is the responsibility of the following resolutive bodies: a) Board of Specialists: Its attributions, functions and responsibilities are those established in articles 18 and 23 of the Law of the Institute of Retirements and Pensions of Officials and Employees of the Executive Branch (INJUPEMP), its Regulation and Normative provisions. b) Committee of Eventual Assets: Within the scope of its competence it must propose to the Board of Specialists the disposal and lease, through public auction of the eventual assets, registered in favor of The Institute.

Composition of the Committee of Eventual Assets. - The Committee of Eventual Assets shall be composed as follows:

• 1)

  A Member of the Board of Specialists, who shall preside over it.

• 2)

  Head of the Finance Division, who shall serve as Secretary.

• 3)

  Head of the Department of Eventual Assets.

• 4)

  Head of the Administrative Division.

• 5)

  Head of the Loans Division.

• 6)

  Head of the Legal Services Unit. For meetings to be held, the attendance of all members of the Committee shall be essential. In case of absence of the holders of the aforementioned areas, they shall be substituted by the person legally corresponding with the right to voice and vote, the member holder being the one who shall appoint their representative, who must be a permanent official and meet the requirements of suitability proper to the position. In the event that in the composition of the Committee there exists a relationship of chief and subordinate, the latter may participate with the right to voice, but not to vote. The Specialist Director President shall communicate to the CNBS the appointment of the persons who make up the Committee and shall notify the substitution of any of its members, in the latter case informing the reasons for said substitution within five (5) business days after the appointment occurs.

Powers of the Committee of Eventual Assets. - The following are the powers of the Committee of Eventual Assets:

• 1)

  To ensure strict compliance with these policies and the applicable legal framework in this matter.

• 2)

  To request authorization from the Board of Specialists for the public auction processes for the disposal and lease of the eventual assets.

• 3)

  To perform the opening and analysis of the offers received and proposals for adjudication and/or lease of the eventual assets, ensuring that these are carried out under the best conditions in favor of the Institute.

• 4)

  To conduct the monitoring and control of the disposals and/or leases of the Eventual Assets within the time periods established in these policies.

• 5)

  To review the reports of eventual assets.

• 6)

  To coordinate with the departments of the Institution, linked to the process of adjudication, registration and sale of eventual assets, the generation of timely information in order to avoid delays in said process, in accordance with these policies and other applicable regulations.

• 7)

  The other powers that are indicated in the present policies, laws, applicable regulations and sound prudential practices.

Head of the Department of Eventual Assets. - Depends on the Administrative Division and is the person who shall coordinate the following activities:

• 1)

  To administer, control and keep custody of the files of eventual assets, which must contain all the corresponding documentation.

• 2)

  To reconcile monthly the inventory of eventual assets against accounting records.

• 3)

  To coordinate with other departments, that the eventual assets are properly legalized, with adequate maintenance, with the necessary security measures, for those properties that are not located in areas of high social risk duly accredited by the competent authority, The Institute must manage the insurance of these, likewise, they must be cleared and available for sale and/or lease.

• 4)

  To remit for custody to the Department of Treasury of the Institution, the originals of the public deeds, relating to the eventual assets, registered in favor of The Institute, as well as any document deemed appropriate.

• 5)

  To prepare the documentation relating to the public auction processes for disposal or lease.

• 6)

  To prepare and conduct the public auction processes of the eventual assets of The Institute, either for sale and/or lease, upon authorization from the Board of Specialists.

• 7)

  To coordinate with the competent areas the processes of publicity, auction, sale and other related activities.

• 8)

  To present to the Committee of Eventual Assets the offers to purchase and lease, received from those interested in acquiring or leasing said properties.

• 9)

  To submit a quarterly report to the Board of Specialists and the CNBS, on the management of Eventual Assets.

• 10)

  To conduct inspections of Eventual Assets every six (6) months. In the event that these have not been adjudicated, they may be given on lease.

• 11)

  To request effectiveness from each department involved in the process of eventual assets for proper functioning and thus comply with the standards of the CNBS. CHAPTER III ADJUDICATION, RECEPTION, REGISTRATION AND ACCOUNTING OF EVENTUAL ASSETS

Acquisition. - INJUPEMP may adjudicate eventual assets by: 1) Payment in Kind. 2) Judicial Auction.

Reception, Registration and Custody. - The Legal Services Unit shall immediately remit a copy of the Auction Minutes and in case of payment in kind, the public deed of ownership of the property in favor of INJUPEMP, duly registered in the corresponding public registry, to the Head of the Department of Eventual Assets and the latter in turn shall remit them within a maximum of ten (10) business days, to the Department of Treasury for their respective custody. Likewise, the Legal Services Unit shall be in charge of its registration in the corresponding public registry, for its subsequent custody by the Department of Treasury of INJUPEMP.

Clearing of Title. - The Legal Services Unit in coordination with the departments involved shall investigate and inform the Head of the Department of Eventual Assets, who shall present in his report to the Committee of Eventual Assets, the situation of each of the eventual assets registered, including the payment of taxes or municipal fees, payment of public services so that there are no tax burdens on them.

Reception, Registration and Accounting. - Once the eventual asset has been accepted and acquired by The Institute, it shall proceed to its registration in the Public Registry of the corresponding locality and shall be accounted for within the ten (10) business days following its acquisition, understood as such the date on which the payment in kind took place or the date of the Certification of the Judgment issued by the competent Judge in the case of judicial auction. The Institute shall have up to ninety (90) calendar days from the accounting record to legalize said acquisition, including its registration in the corresponding Public Registry. When due to administrative problems related to the corresponding Public Registry, the registration of the eventual asset is carried out within a period longer than that established in the preceding paragraph, it must be stated in the filing document that the registration process was initiated before the expiration of the established deadline.

Reception of Movable and Immovable Property in Payment of Debts of Related Parties. - Prior to the reception of payment in kind of movable and immovable property for credits granted to participants related by executive management, INJUPEMP shall submit to the National Commission of Banks and Insurance (CNBS), a request for authorization, attaching the opinion of the administration of The Institute regarding the convenience, from the financial and legal point of view, of accepting the referred eventual assets. Said opinion must also contain the reasons or motives for which the related parties cannot comply with the agreed obligations, for this purpose copies of the collection actions carried out must be attached. For these purposes The Institute must comply with the current regulations on the matter of credit operations with related parties issued by the Central Bank of Honduras (BCH). If there is no appraisal conducted in the immediately preceding year, a new valuation will be required performed by a professional registered in the Registry of Appraisers of Movable and Immovable Assets, Other Assets and Credit Guarantees that the CNBS keeps for this purpose.

Book Value. - Eventual Assets shall be recorded in the accounting books of INJUPEMP considering the lower value of the following cases:

• a)

  That agreed with the debtor in the payment in kind.

• b)

  That of the appraisal conducted by a professional registered in the Registry of Appraisers of Movable and Immovable Assets, Other Assets and Credit Guarantees of the CNBS, net of the discounts contained in the current regulations on evaluation and classification of the credit portfolio.

• c)

  That contained in the judicial auction; and d) That of sixty percent (60%) of the outstanding balance of the credit. To the value obtained through the application of the procedure indicated, the legal expenses incurred by INJUPEMP shall be added. When a set of assets are received in payment, the individual value of which is not detailed in the corresponding deed and which are susceptible to being sold separately by INJUPEMP, The Institute shall previously conduct the corresponding appraisal, which must be conducted by an appraiser registered in the Registry of Appraisers of Movable and Immovable Assets, Other Assets and Credit Guarantees that the CNBS keeps, to assign the total value of each asset separately.

Recording of Loss in the Acquisition of Eventual Assets. - When the balance of the credit that is being paid is greater than the value of the registration of the asset that is incorporated and in the event that there are no other assets subject to payment in kind or judicial auction, said difference must be charged against the reserves for credit, if The Institute had sufficient reserves for its credits of doubtful recovery, and if these reserves are not sufficient the difference shall be charged against the results of the period.

Expenses Charged to Income Accounts. - The expenses incurred in the recovery of the property, plus the investments made in the eventual assets and the expenses for clearing of title shall be part of the base price of the property to be auctioned, likewise, the expenses for public services, taxes or municipal fees shall be included.

Recording of Gains or Losses in the Sale of Contingent Assets.- The result of the sale of contingent assets must be recorded by the Accounting Department, as appropriate, in the following manner: a) If the sale is for cash and the selling price is greater than the value recorded in the books, the difference shall be recorded as income at the time of sale; and, b) If the sale is on credit, and for a value greater than that recorded in the books, the excess must be recorded in a liability account and registered proportionally in an income account as the value is recovered in accordance with the credit installments agreed upon with the debtor participant who acquires said contingent asset. For credit sales, the following conditions must be met: - That according to the Financial information and background of the borrower of the credit originated by the sale of the asset, payment capacity has been established and a good payment history in other credit obligations obtained. - That the credit conditions for the purchase of the asset are in accordance with what is established in the Current Loan Regulations. In the event that the transaction results in a loss, it must be recognized at the time of sale and charged to the income statement.

Recording of Investments in Contingent Assets.- The Institute may only make investments in contingent assets acquired for purposes of maintenance and preservation of the property, provided that with the execution of those investments a better sale or disposition price is obtained. These investments must be capitalized at the value with which the corresponding contingent asset was recorded and amortized within a maximum period of five (5) years, counted from the date of accounting registration of the contingent asset, if the sale has not been carried out during that period. The capitalization of investments in acquired contingent assets does not increase the holding period of the same.

Reserve for Amortization of Contingent Assets.- Upon the completion of the second year of accounting registration of the contingent asset and having exhausted the efforts to sell and lease such assets, said actions must be duly approved and documented; it shall proceed to the proportional monthly amortization of the book value of each of the acquired contingent assets, in a period not exceeding three (3) years. If contingent assets are not recorded in the accounting system within the period established in Article 10 of these Policies, the amortization process shall begin as of the date on which the accounting registration should have originally been made. The foregoing without prejudice to the sanctions that may result from such non-compliance, the officials and employees who gave rise to it being responsible for such sanctions.

Fully Written-Off Contingent Assets.- When a contingent asset is fully written off at one hundred percent (100%), it must be kept recorded in the balance sheet until it is sold or liquidated. However, the Commission may order the corresponding write-off when these assets represent no value for the Institute.

Appraisal Requirements.- The appraisal shall consider the following aspects:

• 1)

  Location of the land or dwelling and its adjoining properties.

• 2)

  Plans and sketches.

• 3)

  Recent photographs.

• 4)

  Description of the property.

• 5)

  Description of useful and permanent improvements.

• 6)

  General characteristics.

• 7)

  Current use of the property.

• 8)

  Natural risks.

• 9)

  Social risks.

• 10)

  Environmental facilities.

• 11)

  Profitability of the property.

• 12)

  Depreciated value of the property.

• 13)

  Estimated value of each of the assets that the property contains.

Conducting the Appraisal.- The appraisal indicated in the preceding article must be conducted by a professional registered in the Registry of Appraisers of Movable and Immovable Assets, Other Assets and Credit Guarantees maintained by the CNBS and in accordance with the database maintained by the Institute. CHAPTER IV DISPOSITION PROCEDURE

Prior Conditions to the Disposition or Sale Process of Contingent Assets.- Prior to submitting contingent assets to the disposition or sale process, the Institute must have them registered in its favor in the corresponding Public Registries, as well as have effective possession of the same, duly cleared.

Criteria for Disposing of Contingent Assets.- In order to dispose of contingent assets, the following aspects shall be considered:

• a)

  Proposals received to satisfaction, with regard to the offered amount, requirements required by the Institute and in case of withdrawal of the winning offer, it shall be awarded to the second or third offer in order, provided that they cover at least the base price.

• b)

  In case there are two offers with the same value, the cash offer shall be considered in the first instance, provided that the Institute carries out due diligence in matters of prevention of money laundering and financing of terrorism.

• c)

  The book or accounting value.

• d)

  Investments made for the purpose of maintenance and preservation of the property, provided that these result in a better sale or disposition price.

• e)

  Cost for clearing, including the payment of taxes and municipal fees.

• f)

  Others that may be generated in the process of recovery of the property.

Disposition of Contingent Assets.- The disposition of contingent assets shall be carried out for system participants and in the case where appropriate to the general public, with the exception that the latter must carry out the purchase and sale operation in cash and at market price. Regardless of those interested in acquiring contingent assets, the disposition or sale of these must be carried out by auction by means of notice of publication in two (2) newspapers of greatest circulation at the national level and two (2) radio media of the country and on the website of the Institute, without time limitation, prior approval of the Board of Specialists. Likewise, in cases where a contingent asset is located in areas of high social risk duly certified by the competent authority, and that has been submitted to at least one auction process, direct sale may be carried out solely through cash payment in accordance with the base price, provided that the Institute carries out due diligence in matters of prevention of money laundering and financing of terrorism, prior notice to the Committee on Contingent Assets and approval of the Board of Specialists. The promotion period prior to the auction shall be one (1) calendar month, and may be extended up to an additional ten (10) days, in case a considerable number of offers are not received, during which period offers presented by those interested in purchasing the Contingent Asset shall be received, which must be presented in sealed envelopes to the Head of the Contingent Assets Department or to the officer in charge of INJUPEMP Regional Offices in the cases that apply, so that subsequently the offers shall be opened at the session of the Committee on Contingent Assets, on the date and time stipulated by the Institute and before the general public.

Minimum Content of Publication Notice.- The publication referred to in the preceding article must contain at minimum the following information: a) Description of the contingent asset. b) Location. c) Base price. d) Financing conditions for system participants and cash for the general public. e) It must be included that the expenses inherent to the formalization of such purchase shall be borne by the purchaser. f) Department and official responsible from where additional information relating to the process of acquisition of the property may be obtained; and, g) Any other information that the Institution considers relevant.

Sale to Related Parties.- The sale of contingent assets to related parties by executive management shall not be granted under more favorable conditions in relation to other system participants and the general public and must request prior authorization from the National Commission of Banks and Insurance.

Deadline for Disposition or Sale of Contingent Assets.- Contingent assets must be disposed of or sold within a maximum period of two (2) years counted from the date of their accounting registration.

Methods of Disposition or Sale.- The disposition or sale of contingent assets may be in cash or on credit, in case the sale is in cash or there is payment of a premium and these are paid in cash, the Institute must observe what is established in the Special Law Against Money Laundering and its Regulations. In case the sale is on credit, it must comply with the guidelines established in the Loan Regulations, as applicable to a Participant.

Retroventa.- In cases where the award has been made in favor of INJUPEMP through judicial foreclosure, the retroventa of the property may be carried out in a special manner at the request of the Participant who was subject to judicial recovery action, provided that it is carried out within the periods established in

of these Policies, that is within (90) calendar days from accounting registration to legalize said acquisition, provided that the registration or legalization of the property before the Public Registry of the corresponding locality in favor of INJUPEMP has not been materialized. Such retroventa must be carried out for a value determined by the appraisal, plus the expenses incurred in the judicial recovery of the property, and must be carried out in cash, for which the Institute must act with due diligence in matters of prevention of money laundering and financing of terrorism. Expenses for taxes, fees and municipal public services would be at the expense of the interested party to whom the retroventa of the property is made.

Inspection of Eventual Assets.- Participants, related parties, and members of the general public with interest may coordinate with the Head of the Department of Eventual Assets of The Institute for inspections at the location where the eventual assets subject to transfer or sale are located.

Delivery of Eventual Asset.- Every eventual asset transferred shall be delivered once the sales documents have been formalized, on credit or cash as the case may be. Once the eventual asset has been awarded, the acquirer may designate the respective Notary; the expenses inherent to the formalization shall be the responsibility of said acquirer, and the sale must be formalized within a period of up to six (6) months, counted from the date of execution of the respective promise to sell, and may be extended by mutual agreement of the parties; otherwise it may be sold to another person.

Use of Eventual Assets.- The INJUPEMP may allocate an eventual asset for its own use, upon written request to the National Commission of Banks and Insurance (CNBS), attaching in addition to the background documents relating to the asset and the reason justifying the use to be given, the adjudication value, the accounting value, the appraisal value, the amortization made if applicable, as well as the property documents duly recorded. Those eventual assets authorized by the CNBS must be accounted for as fixed assets and recorded at book value. The CNBS shall have a period not exceeding thirty (30) business days, counted from the date on which all required documentation is received, to grant or deny such request. CHAPTER V LEASE OF EVENTUAL ASSETS

Lease Contract for Eventual Assets.- For the purpose of generating income from unproductive assets, The Institute may lease the eventual assets registered in its favor, for which the term of said lease shall not exceed two (2) years, without prejudice to the fact that during such period of time the Specialist Directors, as well as the members of the Committee on Eventual Assets, must manage the sale of such assets; otherwise they shall be held responsible for the sanctions applied by the National Commission of Banks for such breach. For this purpose, the INJUPEMP must inform the CNBS of each case within thirty (30) days following the date of execution of the respective lease contracts, and the CNBS may object to it if it considers that The Institute did not comply with the provisions of these policies, and must include in the contracts executed with the lessor the condition that if the CNBS objects to it, the INJUPEMP shall not bear any responsibility for its rescission. Furthermore, The Institute must register the lease contracts with the Administrative Department of Tenancy (DAI). The rent shall be established by an appraiser duly certified by the CNBS, at the request of the Head of the Department of Eventual Assets. In cases of lease of eventual assets to related parties, the lease conditions shall not be preferential in relation to those granted to third parties.

Registration of Income Derived from Lease of Eventual Assets.- The income generated by the contracts referred to in the previous article shall be accounted for in the corresponding income accounts and within the period in which they are accrued. The execution of these contracts and after the two (2) years referred to in these Policies have elapsed, does not exempt The Institute from recording the annual amortization referred to in Article 17 of these Policies.

In cases where there are requests for lease of eventual assets owned by The Institute, these must be submitted for evaluation by the Committee on Eventual Assets, through viability analysis and the amount of lease according to a market analysis, the result of which shall be reflected in the Minutes of the Committee and subsequently must be submitted for consideration of the Board of Specialists for approval.

Lease Contract for Eventual Assets.- The preparation of Lease Contracts shall be the responsibility of the Legal Services Unit of The Institute. CHAPTER VI FINAL AND TRANSITORY PROVISIONS

Information on Eventual Assets.- The Head of the Department of Eventual Assets must maintain individual files for each eventual asset acquired that contain at a minimum the following information and documentation: An Auxiliary Registry indicating: a) Name of the debtor to whom the asset belonged, his last category assigned in the Institution, as well as the reserves recorded, and b) Description of the eventual asset, detailing: i. Location ii. Accounting Date iii. Acquisition Date iv. Accounting Value v. Investments made; and, vi. Amortization of the fiscal year and Accumulated Amortizations. c) Copy of the adjudication deed or dation in payment, duly registered in the corresponding Public Registry. d) Appraisal for sale e) Copy of accounting operations. f) Publications of auction notices and copy of auction records, if applicable. g) Memorandum or liquidation note that must contain at a minimum the following: i. Detail of the balance of obligations that were paid principal and interest when applicable. ii. Category of the debtor at the time of acquisition of the eventual asset. iii. Detail of expenses incurred in the adjudication of the asset; and, iv. Comparative of values evidencing that the accounted value is in accordance with what is established in these Policies. h) Report of field visit or inspection performed on unsold eventual assets within the established period with an age period not exceeding four years, noting that the asset has no problems of possession or existence.

Submission of Information.- The Head of the Department of Eventual Assets must submit to the CNBS within ten (10) business days following the close of the months of March, June, September, and December, a report of eventual assets containing the information referred to in Annex 1 "Inventory and Control of Eventual Assets" and Annex 2 "Reconciliation of Balances of Eventual Assets as of ____ of ___ of ___ which form part of these Policies. Likewise, The Institute shall be responsible for the content, truthfulness, validation, and submission of the data sent to the CNBS. The information received by the Commission may be verified at any time; and, in case there are deficiencies due to error, omission, or fraud in the reported information, The Institute and the responsible official shall be subject to the sanctions that in application of the Law and applicable regulatory framework correspond.

Unforeseen Cases.- Cases not provided for in these Policies shall be resolved by the CNBS, in accordance with the provisions of the applicable legislation on the matter.

Sanctions.- Non-compliance with the provisions established in these Policies shall be sanctioned by the INJUPEMP in accordance with the severity of the infraction and what is established in the Sanctions Regulation and Internal Work Regulation issued by said Institute.

Repeal.- These Policies repeal the Policies for the Administration of Eventual Assets of the National Institute of Retirements and Pensions of Employees and Officials of the Executive Branch (INJUPEMP) approved by the Assembly of Participants and Contributors, in the ordinary session of June 15, 2017, item No. 05 subsection a) contained in Minutes No. 24-2017 of the INJUPEMP.

Transitional Provision.- Assets that at the time these Policies become effective are recorded as eventual assets shall maintain their registration value in accordance with the Procedures Manual and Constitution of the Commission for the Administration, Accounting Registration, and Sale of Existing Eventual Assets; nevertheless, the registration of eventual assets from the effective date of these Policies shall be registered in accordance with what is contemplated therein.

Effective Date.- These Policies for the Administration of Eventual Assets may only be reformed or repealed by the Assembly of Participants and Contributors, in accordance with what is stipulated in Article 9 numeral 6) of the INJUPEMP Law, and they shall become effective from the date of their publication in the Official Journal "La Gaceta".- SECOND: Communicate this Resolution to the Interim Executive Director of the INJUPEMP and to the National Commission of Banks and Insurance (CNBS), for the corresponding legal purposes.- THIRD: This Resolution is of immediate execution.- COMPLIANCE.- (S.), COSBERTH CRISTÓBAL CORRALES, President.- (S.) MARTHA DOBLADO ANDARA, Secretary. The present certification is issued in Tegucigalpa M.D.C., on April 7, 2021. MSc. MARTHA DOBLADO ANDARA Interim Executive Director, INJUPEMP Secretary of the Assembly 8 M. 2021.