Additional Rules On Brazilian Financial Bills

The Brazilian Monetary Council (Conselho Monetário Nacional – CMN) issued Resolution No. 4330, of May 26, 2004 (CMN Res. 4330/2014), improving the rules on the issuance of Financial Bills (Letras Financeiras – LFs), regulating provisions established by Law No. 12838, of July 9, 2013 (Law 12838/2013) that aligns certain characteristics of the LF to the requirements necessary for its use for purposes of composition of the Regulatory Capital (Patrimônio de Referência – PR) of the issuing financial institutions¹.

The LF is a credit document that constitutes a promise of payment in cash, issued in the registered form, which may be transferred to third parties and it is freely negotiable. It must be exclusively issued in book-entry form, through the registration in a registry and financial settlement of assets system authorized by the Central Bank of Brazil (Banco Central do Brasil – Bacen).