"The management is entrusted to a Risk Management Committee".

The functioning and operation of Microfinance Institutions is regulated by Decree 25-2016, "Microfinance Entities and Nonprofit Microfinance Entities Law".

In that regard, in August 3, 2018 the following resolutions by the Monetary Board were published in the Official Gazette: i) JM-51-2018, "Regulation for the Financing granted by Microfinance Entities"; ii) JM52-2018, "Regulation of Prudential Aspects for Microfinance Entities"; and iii) JM-53-2018, "Regulation for the Comprehensive Risk Management of Microfinance Entities".

Among other provisions, such regulations aim to:

1. Set i) the minimum information to be obtained from financing applicants and debtors; ii) the valuation of microcredit portfolio by default; and iii) the limits to be taken into consideration by microfinance institutions when granting financing to individuals or legal entities and for consumption and housing microcredits;

2. Regulate the minimum prudential aspects regarding the liquidity reserve, the minimum amount of requested assets and the global proportions in foreign currency to be kept by microfinance entities;

3. Determine the minimum aspects to be taken into consideration by microfinance institutions, by establishing the obligation to implement the comprehensive risk management (credit, liquidity and operational risks), under the direction of a Risk Management Committee and whose functioning and execution is under the responsibility of the Board of Directors of the entity.