CORPORATE GOVERNANCE

REPORT

2018

BANCO MONTEPIO GERAL CABO VERDE

INTRODUCTORY SECTION

1. INTRODUCTION

In September 2017, under the powers granted by article 33, paragraph 1, of Statute no. 62/VIII/2014 of

23 April, the Bank of Cape Verde (henceforth referred to as “BCV”) approved the Financial Institutions

Governance Code. The Banco Montepio Geral Cabo Verde (henceforth referred to as “BMGCV‟ or “Bank‟) is

fully held by Caixa Económica Montepio Geral, Caixa económica bancária, S.A. (henceforth referred to as

“Banco Montepio‟), an entity supervised by the Bank of Portugal (henceforth referred to as “BoP”) and

subject to the market rules defined by the Portuguese Securities Market Commission (henceforth referred

to as “CMVM” - Comissão de Mercado de Valores Mobiliários). The Bank is therefore an integral part of the

consolidation perimeter of BM and falls under the corporative guidelines issued by the parent company. As

such, BM discloses, on an annual basis, its Corporate Governance Report (“CGR") containing the

governance criteria of the Group, namely elements concerning its shareholder structure, company

organisation and governance, as well as elements concerning the assessment of the corporate Governance,

according to the regulations in force. The present report must fall within the frame of the regulatory need

to prepare a specific corporate governance report for the BMGCV, as established in notice no. 6/2017, but

also of the need to respect the corporate governance regulatory requirements that govern the Banco

Montepio Group, both in Portuguese jurisdiction and in EU jurisdiction, particularly the internal governance

recommendations issued by EBA.

2. STATUTORY FRAMEWORK OF THE BANK

2.1. Banco Montepio Geral - Cabo Verde, Sociedade Unipessoal, S.A.

Banco Montepio Geral - Cabo Verde, Sociedade Unipessoal, S.A. is a credit institution, with its head office in

Rua da Comunicação Social, nº 2 — 1 Esq, Cidade da Praia, Island of Santiago, Republic of Cape Verde and

fully held by Caixa Económica Montepio Geral, Caixa económica bancária, S.A., and was incorporated on 7

September 2005.

The BMGCV is authorised to operate within the scope of the legislation governing the activity and offer of

financial products and services, authorising its licensing and the full compliance with all rules, ratios and

limits prescribed in the legal framework of Cape Verde.

The BMGCV provides an encompassing offer of financial specialised products and services for the private,

institutional and internationally oriented companies segments, diverse savings solutions as well as treasury

and risk management solutions.

The organisational structure of BMGCV includes a commercial aspect focused on client and business, locally

performed by a business operation generation and management unit; a

second organisational pillar focused on the technical and operational assistance to the business, carried out

through services rendered by Banco Montepio and, finally, a control pillar, the action of which is developed

by the heads of the parent company’s audit, compliance and risk functions, which aims to ensure an

effective compliance with the legal obligations and regulatory duties to which the Bank is bound as well as

an appropriate risk management inherent to the activities carried out.

4-Additional information.

I. Capital structure

PART I – MANDATORY INFORMATION ON SHAREHOLDER STRUCTURE AND INSTITUTION ORGANISATION AND

GOVERNANCE (See attachment I, Notice no. 7/2017)

A- RECEIVING STATEMENT

1-Received recommendations that are provided for in the Financial Institutions Governance Code;

In total, 68% (19/28) of the recommendations provided for in the Financial Institutions Governance Code were received.

2-Non-received recommendations that are provided for in the Financial Institutions Governance

Code; In total, 32% (9/28) of the recommendations were not received or are about not to be received, given the

legal and statutory framework of the Bank.

3-Grounds for the non-reception with regards to the recommendations which are not received. The

grounds may be present through a referral to the report section in which the matters is further

elaborated. An important part of the “non-received” recommendations are about to be received, since decisions

on part of the Board of Directors were taken to that effect. See comments inserted in Part II of the report.

B- SHAREHOLDER STRUCTURE

5. Capital structure (share capital, number of shares, distribution of capital to

shareholders), including indication of shares or bonds non-admitted to trading,

different classes of shares, rights and duties inherent to such shares and percentage of

capital represented by each class.

The Bank’s share capital amounts to 992,000,000.00 CVE (Cape Verdean Escudo), corresponding to

99,200 shares if the sum of 10,000.00 CVE each, fully paid-up by its sole shareholder Banco

Montepio.

6. Restrictions to the transmissibility of shares, such as consent clauses for disposals or

limitations to the ownership of shares.

There are no restrictions to the transmissibility of the securities that make up the Bank's share

capital.

7. Number of own shares, percentage of corresponding share capital and percentage of

voting rights associated with the own shares.

The Bank acquired no shares representing its share capital

8. System of renewal or revoking of defensive measures, especially those that stipulate

the limitations of the number of votes susceptible of being held, or exercised, by a

single shareholder individually or in coordination with other shareholders.

It has no application on account of the status of Banco Montepio as sole shareholder.

9. Significant agreements to which the company is a party or which enter into force, are

altered or cease to exist in case of change of control of the company following a

takeover bid, as well as the respective effects, except if, due to its nature, the

disclosure thereof would be seriously harmful to the institution, unless the institution

is specifically obliged to disclose such information due to other legal requirements.

The existing significant agreements refer to provisions of operational and control services that are

assured, according to the Contract for the Provision of Services entered into between BMGCV and

Banco Montepio on 27/06/2013, with amendments of 12/05/2014 and reviewed on 25/02/2019, by

organic units of the parent company, namely the Audit and Inspection Directorate, Risk

Directorate, Strategic Planning, Control and Accounts Directorate, Marketing Directorate, Digital

and Innovation Directorate, Organisational Development Directorate, Information Systems

Directorate, Financial and International Directorate and Compliance Directorate, which are very

likely to cease their activity if the company is subject to a takeover bid.

10. Shareholder agreements that are known of the institution and may lead to restrictions

in terms of transmission of securities or voting rights.

There are no shareholder agreements.

II. SHAREHOLDINGS AND BONDS HELD

11. Identification of the natural or legal persons that, directly or indirectly, hold qualified

shareholdings, with detailed indication of the attributable percentage of capital and

votes and the source and causes of attribution.

The Bank’s share capital is concentrated into a sole shareholder, Bank Montepio.

12. Indication of the number of shares and bonds held by management members and

supervisory bodies.

The members of the management body and the members of the supervisory body hold no

shareholdings in shares or bonds of the Bank.

13. Information on the existence of significant relations of a business nature between the

holders of qualified shareholdings and the institution.

With reference to 31 December 2018, the sole shareholder Banco Montepio was creditor of

700,000.00 Euro as a result of a 6-year subordinated loan, granted on 22 May 2013 for

supplementing the Bank’s own funds. Given the comfortable position of regulatory capital and with

the indispensable internal governance procedures met - including the prior authorisation of the

Bank of Cape Verde - the Bank requested that the sole shareholder reimbursed that loan on the

date of its maturity, on 22 May 2019. Additionally, Banco Montepio holds a debt position of 166.6 M

Euro, resulting from financial investments (in deposits) that the Bank carries out. Finally, the sole

shareholder provides operational and control services to BMGCBV as established in Point 9 (above).

14. Indication of the management body’s special powers, namely with regards to

resolutions for increase of capital, with indication of the date on which those powers

were granted, term for the exercise of such powers, maximum quantitative limit of the

increase of share capital, amount already issued under the attribution of powers and

mode of execution of the powers attributed.

There are no special powers attributed to the Board of Directors. The responsibilities of the Board

of Directors with regards to resolutions for the increase of capital are those resulting from its

Articles of Association and the Legislation on Commercial Companies.

I. GENERAL MEETING

a) Composition of the board of the general meeting

b) Exercise of voting right

C. GOVERNING BODIES AND COMMISSIONS

15. Identification and position of the members of the board of the general meeting and

respective term of office (beginning and end).

The members of the Board of the General Meeting were elected for the 2017-2020 term.

Board of the General Meeting

Chairman Rui Manuel da Silva Alves

First Secretary Raquel Ferreira Guerreiro Lima

16. Potential restrictions in terms of voting rights, such as limitations to the exercise of

vote depending on the ownership of a number or percentage of shares or deadlines

imposed for the block of shares or for the exercise of the voting right.

There are no restrictions in terms of voting rights, given the fact that the Institution has one sole

shareholder.

17. Indication of the maximum percentage of voting rights that can be exercised by one

sole shareholder or by shareholders that are in a control or Group relationship with the

former.

Given the fact that the Institution is held by one sole shareholder, the maximum percentage of

voting rights is 100%.

18. Identification of the shareholders’ resolutions that, due to statutory requirements and

apart from those established under law, may only be taken by a qualified majority, and

indication of those majorities

Apart from the resolutions established under law, there are no statutory provisions that require a

qualified majority.

II. MANAGEMENT

a) Composition

19. Statutory rules on procedural and material requirements applicable to the appointment

and replacement of the members of the Board of Directors.

According to the Bank’s Article of Association, all holders of management bodies are elected at the

Bank’s general meeting, on a proposal from the sole shareholder and with the fulfilment of the

assumptions defined in the Policy for the selection and assessment of adequacy of the members of

the Board of Directors and Statutory Audit Board approved by the Bank’s General Meeting in 2017.

According to the Articles of Association, the Board of Directors (BA) operates as a body, and can

take resolutions whenever the majority of the members are present. The BA resolutions are taken

by a majority of the votes of the holders present, with the Chairman entitled to a casting vote. It

may also appoint agents to represent the Bank in any acts and contracts and define the extension

of the respective terms.

20. Composition of the Board of Directors, with indication of the minimum and maximum

number of members, statutory duration of the term of office, number of effective

members, date of first appointment and date of term of each member’s term of office.

The Board of Directors of the Bank is composed of a minimum number of five members, one

Chairman and four members, with the President being appointed by the General Meeting.

At the General Meeting of 30 May 2017, the following members of the Board of Directors were

elected for the 2017-2020 term:

BOARD OF DIRECTORS

Chairman João Carlos Martins da Cunha Neves

Members

Luís Filipe Santos Costa José Carlos Sequeira Mateus

Maria Rosa Almas Rodrigues

João de Andrade Lopes

Alternate Members Vasco Francisco Coelho de Almeida

Isabel Maria Loureiro Alves Brito

With the exception of Mr. José Carlos Sequeira Mateus, whose first appointment took place on 25

March 2014; all remaining members were appointed for the first time. The term of office of all

members of the Board of Directors ends on 31 December 2020.

21. Distinction between the executive and non-executive members of the Board of

Directors and, regarding the non-executive members, identification of the members

who can be considered independent.

Mr. João Carlos Martins da Cunha Neves, Mr. José Carlos Sequeira Mateus and Mr. João Andrade

Lopes performed executive duties in the Board of Directors, the former being the Chairman. Mr.

Luís Filipe Costa and Ms. Maria Rosa Almas Rodrigues performed non-executive duties. Mr. João

Andrade Lopes and Ms. Maria Rosa Almas Rodrigues are independent members.

22. Professional qualifications and other relevant resume-related elements related to each

of the members of the Board of Directors and number of functions simultaneously held

by the members of the management body.

The curricula of each of the aforementioned members are included in Attachment I to the present Report.

23. Institution’s policy as regards gender diversity in the composition of its governing

bodies.

The Policy for the selection and assessment of adequacy of the members of the Board of Directors

and Statutory Audit Board in force (Attachment IV) establishes: (a) the underlying general

principles and objectives, (b) the heads of assessment and adequacy, (c) the criteria for

identification and selection of the persons suitable to integrate the Board of Directors and the

Statutory Audit Board,

(d) the procedures of assessment under the legally established adequacy requirements and

(e) the rules on prevention, communication and correction of the situations of conflict of interest

and is aimed at the promotion of independent and transparent internal policies, aligned with the

best corporate governance practices that govern the banking activity, and envisages provisions

concerning the gender diversion, namely in Point 11 of the Policy, as follows:

24. Family, professional or business relations, recurrent and significant, of members of the

Board of Directors with shareholders that hold qualified shareholding representing

more than 2% of voting rights.

Given the fact that the Bank has one sole shareholder - Banco Montepio, a corporate body - the

existence of family, professional or business relations with shareholders that hold qualified

shareholding representing more than 2% of voting rights is not applicable here.

25. Organisation charts or functional maps concerning the division of competences among

the various governing bodies, commissions and / or departments of the institution,

including information on delegation of competences, particularly with regards to the

delegation of the day-to-day management of the institution.

The Board of Directors (BD) is the body responsible for managing the BMGCV and for the ongoing

management of the company. The organisational model and the division of competences among

the various organic units is the responsibility of the Board of Directors, which defines the

organisational structure model and the division of tasks among the various organic units. In turn,

the organic units group first line bodies, Departments, Offices and Directorates which respond

directly to the BD. The organisational structure of the Bank involves a commercial aspect, focused

on the client and on the business, that is locally carried out by a business operation generation and

management unit the performance of which is governed by Service Orders no. 02/2016 and

03/2016; a second organisational pillar focused on the technical and operational assistance to the

business, carried out through services rendered by Banco Montepio and, finally, a control pillar, the

action of which is developed by the heads of the parent company’s audit, compliance and risk

functions, which aims to ensure an effective compliance with the legal obligations and regulatory

duties to which the Bank is bound as well as an appropriate risk management inherent to the

activities carried out (Attachment II).

The briefs are allocated according to the Member’s profile, the need to segregate functions and the

management efficiency of the organisation (Attachment II).

As regards the control functions, their organisation and operation are described in points 55 et seq.

26. Existence and location where the Board of Directors’ operation regulations can be

consulted.

Apart from the legal, statutory and regulatory provisions, all activities carried out by the Institution

are also governed by the compliance with the governing bodies’ resolutions, internal rules,

standards of conduct and ethical standards.

In the internal portal (Intranet), the Internal Regulation, disclosed to all workers, contains an

encompassing set of documents classified according to the goals and corresponding contents, as

well as a set of standards regarding professional and deontological practice. With regards to the

compliance with the prudential rules in force and the respective reporting deadlines for external

entities, there is an Internal Standard aimed at ensuring the fulfilment of the duty to inform.

As at the date of drawing-up this report, the Institution website, www.bmgcv.cv, was still being

updated, wherefore not all the information on the internal governance of BMGCV is yet available,

namely the regulations for the management bodies’ operation.

27. Number of meetings held during the year in terms of reference and degree of

attendance of each member of the Board of Directors.

The Articles of Association of BMGCV establish that the Board of Directors must meet at least once

every quarter and, furthermore, as per its internal regulation, every time the Chairman convenes a

meeting or any time a member requests a meeting to the Chairman and states the reasons

therefore.

During 2018, the Board of Directors met seven times with the following assiduity:

Members Attendance / Total

January to December

João Carlos Martins da Cunha Neves 07/07

Luís Filipe Santos Costa 04/07

José Carlos Sequeira Mateus 05/07

Maria Rosa Almas Rodrigues 06/07

João de Andrade Lopes Correia 07/07

b) Operation

28. Indication of the bodies of the institution competent to carry out the performance

assessment of the executive directors.

The body competent to carry out the performance assessment of the executive directors is the

General Meeting, which bases its evaluation on to the works of the REMUNERATION,

APPOINTMENTS AND ASSESSMENTS COMMISSION, as a body of the Group.

29. Predetermined criteria for the performance assessment of the executive directors.

The assessment of the management body’s performance as well as of the performance of the

remaining holders of Bank bodies is defined in a separate document: “Policy for the selection and

assessment of adequacy of the members of the Board of Directors and Statutory Audit Board”

(Attachment IV), which stems from the prudential judgment based on the experience of the

institution itself, the observation of what takes place in similar entities, and aligned with the global

strategy of the Institution as approved by General Meeting. The assessment is carried out at

General Meeting on an annual basis by the sole shareholder.

30. Availability of each of the members of the Board of Directors, with indication of the

offices simultaneously held in other companies, within and outside the group, and

other relevant activities carried out by the members of those bodies during the

financial year.

The duties performed by the Board of Directors in invested companies are broken down in

Attachment I to the present Report. The number of hours allocated to BMGCV activities were as

follows:

Members Hours / Week

January to December

João Carlos Martins da Cunha Neves 40

Luís Filipe Santos Costa 5

José Carlos Sequeira Mateus 5

Maria Rosa Almas Rodrigues 20

João de Andrade Lopes Correia 40

III. OVERSIGHT

a) Composition

31. Identification of the commissions created within the Board of Directors and local board

where the operation regulations may be consulted.

As at 31 December 2018, there were no commissions or committees of support to the BD.

32. Composition, where applicable, of the executive commission and/or identification of

deputy director(s).

The existence of an Executive Commission or of Deputy Directors is not applicable to the articles of

association of the Bank.

33. Indication of the responsibilities of each of the commissions created and summary of

the activities carried on in their exercise.

As at 31 December 2018, there were no commissions constituted within the Board of Directors.

34. Composition of the Statutory Audit Board, with indication of the minimum and

maximum number of members, statutory duration of the term of office, number of

effective members, date of first appointment and ending date of each member’s term

of office.

The Statutory Audit Board is composed of a Chairman and four members, of whom two are effective

and two are alternates, with the Chairman appointed by the General Meeting.

At the General Meeting of 30 May 2017, the following members of the Statutory Audit Board were

elected for the 2017-2020 term:

STATUTORY AUDIT BOARD

Chairman José Manuel de Jesus Martins

Members

Alternate Members

Miguel Pedro Sousa Monteiro1

Amílcar Gonçalves de Melo2

Fernando Manuel Ferreira Boto Ilídio Alexandre da Cruz3

1 Resigned from the post on 21 March 2018, having then been replaced by Fernando Manuel Ferreira Boto as effective member.

2 After having been elected at an exceptional General Meeting on 18 December 2017, he then resigned from the post on 1 July 2018,

and was replaced by Ilídio Alexandre da Cruz as effective member. 3 Elected at an exceptional General Meeting on 18 December 2017.

c) Commissions within the management or supervisory body and deputy directors

b) Operation

With the exception of Mr. Fernando Manuel Ferreira Boto, all the others were appointed to the

Statutory Audit Board for the first time. The term of office of all members of the Statutory Audit

Board ends on 31 December 2020.

35. Identification of the members of the Statutory Audit Board who are deemed independent.

All members are independent and comply with the incompatibility rules.

36. Professional qualifications, as applicable, of each of the members of the Statutory

Audit Board and other relevant resume-related elements.

The qualifications and the curricula of the members integrating the Statutory Audit Board are

presented in Attachment I to the present Report.

37. Existence and location where the Statutory Audit Board’s operation regulations can be

consulted.

As at 31 December 2018, there was no “Statutory Audit Board’s Operation Regulation”.

38. Number of meetings held and degree of attendance to the meetings held of each

member of the Statutory Audit Board.

During 2018, the Statutory Audit Board met three times and thoroughly followed up the activity of

the Board of Directors through the analysis of the internal control reports, the minutes of the Board

of Directors and meetings with the external auditors.

Members Presences / Total

January to December

José Manuel de Jesus Martins 03/03

Amílcar Gonçalves de Melo 01/03

Ilídio Alexandre da Cruz 02/03

c) Competences and duties

IV. EXTERNAL AUDITOR

39. Availability of each of the members of the Statutory Audit Board, with indication of the

offices simultaneously held in other companies, within and outside the group, and

other relevant activities carried out by the members of those bodies during the

financial year.

This information is available in Attachment I to the present Report. The number of hours allocated to

BMGCV activities were as follows:

Members Hours / Quarter

January to December

José Manuel de Jesus Martins 10

Amílcar Gonçalves de Melo 2

Ilídio Alexandre da Cruz 2

40. Description of the procedures and criteria applicable to the activities of the supervisory

body for the purposes of contracting services additional to the external auditor.

The various auditing services are hired under the authorisation granted by the General Meeting

(GM), through the definition of the tender specifications, market screening, collection of proposals

and submission to the GM.

41. Other functions of the supervisory bodies.

The Statutory Audit Board may also issue a prior opinion, whenever requested by the Board of

Directors, on any matter it deems convenient and urgent. On the initiative of its Chairman, it can

also potentially organise work groups for analysis and supervision of certain matters.

The Statutory Audit Board is the supervisory body that controls and ensures the efficiency of the

internal control function, namely with regards to internal audit, compliance and risk, approving the

audit plans and overseeing the non-compliances with the legal provisions, articles of association

and policies established.

42. Identification of the appointed external auditor.

The Statutory Auditor of BMGCV is PwC & Associados – Sociedade de Revisores Oficiais de Contas,

SA, represented by Carlos José Figueiredo Rodrigues, Statutory Auditor no. 1737 (Registration

number 20161347 at CMBM), until 31 December 2020.

43. Indication of the number of years in which the external auditor consecutively performs

duties with the institution and/or the group.

The PwC & Associados, SROC, S.A. performs duties related to statutory audits of accounts at

BMGCV since 2017, and the mandate is assessed, at every four-year period, at the General Meeting

of BMGCV, on the proposal of the Statutory Audit Board, as per Article 7 of Notice. 4/2014 of the

BCV.

44. Policy and frequency of external auditor's rotation.

The PwC & Associados – Sociedade de Revisores Oficiais de Contas, SA, provides external auditing

services to the Bank under contracts for the provision of services, since 2017. The provision of

services by the PwC, governed by general conditions, on account of a specific letter of contract

“Engagement Letter”, has been extended. According to the practice of previous financial years, the

contract for the provision of services is entered into on an annual basis and meets the criteria laid

down in Article 7, paragraphs 1 and 2 of Notice no, 4/2014 of BCV.

45. Indication of the body responsible for the assessment of the external auditor and

frequency of said assessment.

The Statutory Audit Board is the body responsible for analysing and discussing the external

auditor’s reports, and controlling and ensuring the relations with the external audit. Within the

Statutory Audit Board, it is its Chairman who, within the scope of their duties, and given the size of

the Bank, follows up the external auditor’s activity on a quarterly basis.

46. Identification of the works, distinct from those related to audit, carried out by the

External auditor for the institution and/or legal persons in a control or group

relationship with it, as well as indication of the internal procedures for purposes of the

approval of the hiring of such services and indication of the grounds for their hiring.

The services rendered by PwC during 2018 consisted of the audit of the financial statements and in

the revision of the BMGCB internal control system.

47. Indication of the annual remuneration amount paid by the institution and/or legal

persons in a control or group relationship to the auditor and to other natural or legal

persons belonging to the same network and breaking down of the percentage

concerning non-audit services.

Throughout 2018, PwC & Associados – SROC, SA carried out no services which were not audit-

related.

48. Mechanisms implemented by the institution for purposes of prevention and control of

transactions with related parties.

The members of the management and supervisory bodies and the entities regarded as related

parties, i.e., entities and holders which, directly or indirectly hold a qualified shareholding or with

who they are in a control or group relationship, are identified and marked in the records of the

institution’s central system, which is updated on an ongoing basis.

The BMGCV business model does not envisage the granting of credit to clients, wherefore there is

no need for regulations to govern those operations. Nevertheless, the BMGCV occasionally seeks

the supervisory body’s opinion as well as a Board of Directors’ resolution taken by qualified majority

of at least two thirds.

49. Indication of the transactions which were subject to control in the period in question.

Throughout 2018, the Statutory Audit Board assessed the relevant transactions within the scope of

the transactions with related parties, namely with CEMG/BM.

As defined in IAS 24, MG - Cabo Verde’s related parties are regarded as the members of the Board

of Directors. Apart from the members of the Board of Directors, related parties may also refer to

the persons close to the former (family relations) and the entities controlled by them or through

the management of which they exert a significant influence.

On that basis, the group of related parties considered by MG - Cabo Verde is presented as follows:

Holder of share capital

Caixa Económica Montepio Geral

Board of Directors

João Carlos Martins da Cunha Neves (Chairman)

Luís Filipe dos Santos Costa (Vice-Chairman)

José Carlos Sequeira Mateus (executive Member)

João Andrade Lopes (executive Member)

Maria Rosa Almas Rodrigues (non-executive Member) Isabel

Maria Loureiro Alves Brito (Alternate)

Vasco Francisco Coelho Almeida (Alternate)

V. TRANSACTIONS WITH RELATED PARTIES

As at 31 December 2018 and 2017, the assets held by MG - Cabo Verde on related parties,

regardless of whether or not they are represented by securities, included in the headings of

Available funds in credit institutions and Investments in credit institutions, are analysed as

follows:

Available Funds in

credit institutions

2018

Investments in

credit

institutions

Total

(euro)

Available Funds in

credit institutions

2017

Investments in

credit

institutions

Total

As at 31 December 2018 and 2017, the liabilities of MG - Cabo Verde on related parties, included in the

headings of Client resources, resources from credit institutions and Equity instruments are analysed as

follows:

Client resources

and resources

from other credit institutions

2018

Equity

instruments

Total

(euro)

Companies

Caixa Económica Montepio Geral, caixa económica bancária, S.A.

-

700 519

700 519 - 700 519 700 519

(euro)

Client resources

and resources

from other credit institutions

2017

Equity

instruments

Total

Companies

Caixa Económica Montepio Geral, caixa económica bancária, S.A. 471 441 1 702 186 2 173 627

471 441 1 702 186 2 173 627

Companies

Caixa Económica Montepio Geral, caixa económica bancária, S.A. 879 083

166 638 360

167 517 443

879 083 166 638 360 167 517 443

(euro)

Companies

Caixa Económica Montepio Geral, Caixa económica bancária, S.A. 2 036 966

191 037 222

193 074 188

2 036 966 191 037 222 193 074 188

As at 31 December 2018 and 2017, the costs and revenues of MG - Cabo Verde on related parties, included

in the headings of Interest and similar income and General administrative costs are analysed as follows:

Companies

Interest and

similar

income

2018

Interest

and

similar

charges

(euro)

General

administrative costs

Caixa Económica Montepio Geral, caixa económica bancária, S.A.

2 831 220

11 639

355 698

2 831 220 11 639 355 698

Interest and

similar

income

2017

Interest

and

similar

charges

(euro)

General

administrative costs

Companies

Caixa Económica Montepio Geral, caixa económica bancária, S.A. 3 687 267 11 596 296 625

3 687 267 11 596 296 625

No other economically significant transactions between the institution and members of the

management and supervisory bodies took place in 2018, outside the scope of the institution’s day-

to-day activity.

50. Description of the procedures and criteria applicable to the supervisory body’s

intervention for purposes of prior analysis of the business to be conducted between the

institution and holders of qualified shareholding or entities with whom such holders

are in a relationship.

The carrying out of operations between the institution and holders of qualified shareholdings is not

applicable since the Bank is held by a sole shareholder. The relations established between the

shareholder and the Bank observes the policy of transactions between related parties of the parent

company.

51. Indication of the competence for determining the remuneration of the governing bodies’

members, the members of the executive commission and the institution’s officers.

It is up to the BMGCV General Meeting to define, on annual basis, the remuneration of the holders of

the Bank's bodies according to the duties performed.

VI. REMUNERATION

On an annual basis, the GM approves a statement on the remuneration policy of the members of

the management and supervisory bodies, on the guidance of the corporate governance bodies of

the group.

52. Composition of the remuneration commission including the identification of the

persons or companies hired to provide support and declare on the independence of

each of its members and advisers.

BMGCV has no Remuneration Committee. See Point 15 and 28.

53. Knowledge and experience of the members of the remuneration commission on

remuneration policy.

BMGCV has no Remuneration Committee. See Point 15 and 28.

54. Description of the directors’ remuneration structure, namely with regards to the

variable component.

The remuneration policy was approved in 2017 and is in force for the four-year period 2017 - 2020,

with its maintenance in force being subject to annual confirmation as per (Attachment III). The

variable component of the Directors’ remuneration is regulated in points 5.7 to 5.10 of the

aforementioned Attachment III.

55. Persons, bodies or commissions responsible for internal audit and implementation

of other internal control system components.

The internal control system is ensured within the scope of the Contract for the Provision of Services

entered into by BMGCV and Banco Montepio, namely the Audit and Inspection Directorate, the Risk

Directorate and the Compliance Directorate,

The Board of Directors (BD) is responsible for the implementation and maintenance of an

appropriate and efficient internal control system that ensures the compliance with the performance,

information and Compliance goals.

The Statutory Audit Board ensures that the BD establishes and maintains an appropriate and

efficient internal control and ensures and controls the efficiency of the internal audit function.

Within the scope of its functions, it follows up and assesses the internal procedures of audit,

internal control, risk control and accounts, as well as the respective reports, and sends these to the

BD, accompanied by the corresponding draft opinion.

IX. INTERNAL CONTROL AND RISK MANAGEMENT

The Compliance function, ensured by COMPC - Compliance Directorate (DC) is applicable to all

entities of the Caixa Económica Montepio Geral Group (henceforth referred to as “Group”) and

extensible to all subsidiaries and branch offices abroad, including those domiciled in offshores,

always taking the legislation and regulations of the host country into consideration. If law and

regulations in question inhibit implementation of principles, policies or measures enabling effective

monitoring, in terms of the group, of money laundering and terrorist financing (hereinafter referred

to as ML/TF) risk, Banco de Portugal is informed of such fact. It is up to the BD to carry out a set

of guiding principles for the acceptance, analysis and monitoring of Clients considered of high risk,

of acceptance or refusal of relationship with Clients, according to risk factors deemed high, define

the fundamental principles to be complied with in the process of identification of clients, of their

representatives and effective beneficiaries who, jointly with the application of KYC principles,

create conditions for a correct application of the Client Acceptance Policy and subsequent follow-up

and monitoring, in order that measures of reinforced diligence and ongoing monitoring be applied.

The Internal Audit function is ensured in corporate terms by the Audit and Inspection Directorate

and constitutes an integral part of the internal control monitoring process and, as third line of

defence, executes autonomous complementary assessments of the controls carried out, identifying

potential deficiencies and recommendations, which are documented and reported to the

management and supervisory body. These situations are continuously followed up by the internal

audit function, so as to guarantee that the necessary measures are taken and that such situations

are adequately managed.

The Risk Management function is ensured by the corporate services of the Risk Directorate,

supporting the management in the taking of decisions associated with the management of various

types of risk inherent to the activity, within the Bank. As second line of defence of the risk

management structure, the Risk Directorate is responsible for identifying, quantifying and

monitoring the risk, defining the limits and assessing its fulfilment. It also includes a segregation of

the liquidity, market, interest rate and solvency levels risks, the management of the credit and

operational risks and the development of the risk classification systems of support to the credit

analysis and decision and its validation independent from the development function.

56. Clarification, even though through inclusion of an organisational chart, of

hierarchical and/or functional relations with other bodies or commissions of the

institution.

The Internal Audit, Compliance and Risk Management functions are subject to a dual reporting

duty: to the Board of Directors, to whom they respond hierarchically and functionally, and to the

Statutory Audit Board, to whom they respond functionally.

57. Information on the existence of a risk commission and on the risk-related

information flows.

As at 31 December 2018, BMGCV had no Risk Commission. However, Banco Montepio has a

Risk Committee responsible, within the group, for the periodic revision and monitoring of the

scope and nature of the risk-related activities conducted by the CEMG Group.

58. Existence of other functional areas with risk control competences.

The Risk Management function, as second line of defence of the risk management structure, is

responsible for the identification, quantification and monitoring of risk, definition of limits and

assessment of its fulfilment. The positioning of this organic structure at the corporate level

enhances the independence of its action and ensures an effective separation of the liquidity,

market, interest rate and solvency risks management; the credit and operational risks

management; and the development of the risk classification systems of support to the credit

analysis and decision and of its validation independent from the function.

59. Identification and description of the main types of risks (economic, financial and

legal) to which the institution is exposed in the exercise of its activity.

The main financial and non-financial risks of the Bank’s activity are as follows:

1- Market risk – It reflects the possibility of potential loss that might be recorded by a given

portfolio as a result of changes to (interest and exchange) rates and/or of prices of the

different financial instruments that comprise such portfolio, considering both the existing

correlations between them and the respective volatilities.

2- Liquidity - it is defined as the possibility of occurrence of a Bank's constraint in complying with

its obligations at the moment of the respective maturity, without incurring significant losses

resulting from a degradation of the financing conditions (financing risk) and/or sale of its

Assets for values lower than the market values (market liquidity risk).

3- Operational - It is regarded as the potential loss resulting from failures or inadequacies in the

internal processes, persons or systems, or even the potential losses resulting from external

events.

4- Counterparty risk - It is associated with the likelihood of occurrence of a financial constraint

with the Bank’s counterparties; in the case of BMGCV, this risk is based on the risk of the

Banco Montepio counterparty.

It should be noted that the monitoring and follow-up system for consolidated risks of Banco

Montepio, as well as the controls individually implemented by the Bank, allow for recognising other

relevant non-financial risks to the BMGCV activity, with emphasis on the reputational risk, the legal

risk and the information systems risk.

60. Description of the process of risk identification, assessment, monitoring, control

and management.

The Risk Directorate (RD) is responsible for ensuring the analysis of the potential risks that might

affect the BMGCV activity, particularly the Credit, Market, Liquidity and Operational Risks. In order

to do so, it is up to the RD to adopt a set of measures and procedures:

- To define and propose the adoption of standards and other instruments of support to the credit

decision;

- To design, develop and monitor the performance of scoring and internal rating models in credit

origination, as well as of credit risk follow-up systems.

- To guarantee that the financial statements, duly validated and audited, are inserted into the

Institution’s computer applications;

- To integrate operational risk assessment internal systems adapted to the Supervision’s demands;

- To supply information and draw up reports for supporting the decision as regards the definition

and implementation of risk management strategies, considering the decisions taken within the

scope of the Assets and Liabilities Management Body and the prospects of evolution of the relevant

asset markets for the activity of the Group’s entities and provide technical support, whenever

requested;

- To provide information on the BMGCV risk analysis, as well as on the evolution of the asset

markets where the main risks are concentrated, for submission to Rating agencies, institutional

investors, external auditors, supervisory authorities and inclusion in the Report and Accounts;

- To ensure the prudential reporting to the supervisory authorities, namely in terms of capital

requirements, major risks, liquidity risk, country risk, counterparty risk, stress testing, self-

assessment of adequacy of Own Funds and Market Discipline.

61. Main elements of the internal control and risk management systems implemented

at the institution regarding the financial reporting process.

It is up to the Board of Directors to draw up, on an annual basis, the report and accounts for the

financial year and the proposal of profit distribution, to be submitted to the Statutory Audit Board

and, with the latter’s opinion and the independent auditor’s report, be put before the General

Meeting at a meeting to be held until 31 March.

The External Auditor is responsible for issuing an opinion on the adequacy and efficiency of the

internal control system’s part underlying the process for preparation and disclosure of the individual

and consolidated financial information (financial reporting).

62. Description of internal control mechanisms and procedures, aimed at complying

with the money laundering and terrorist financing prevention legislation.

The BMGCV has implemented policies and procedures aimed at complying with the provisions of

the legislation and regulations in force concerning money laundering and terrorist financing, the

guiding principles of which are defined in the Money Laundering and Terrorist Financing Risk

Management Policy, Client Acceptance Policy, Client Identification Policy and High Risk Client

Monitoring and Analysis Policy, embodied in the tools and information systems in force.

The principles concerning money laundering and terrorist financing are applicable to all BMGCV

clients, their representatives and effective beneficiaries, based on criteria of materiality and risk,

and comprise a dynamic process where the procedures to be adopted are appropriate to the risk

assigned to each client. To that effect, so as to guarantee an efficient risk-based approach, there is

an automatic process which, according to the characteristic elements of each client obtained within

the scope of the fulfilment of the duty of care, as at the establishment of the business relation

and/or in the information updating process (e.g., age, seniority, nationality, place of birth,

occupation, person politically exposed/political or public office holders, classification of economic

activity, among others), allows for a risk classification according to three levels of risk: low,

medium and high.

In addition to the assignment of the risk profile of clients, all operations/transactions are

guaranteed to be continuously monitored by the Compliance function, with any suspicious pattern

of behaviour triggering a risk classification reassessment/reanalysis process. The operations, in line

with their nature, are also subject to risk classification. Within this scope, attention should be

drawn to the implemented tools and information systems that aim:

to guarantee, in real time, that no business relations are established with entities that are on

internal and/or external lists (European Union and Office of Foreign Assets Control (OFAC) – US

Treasury Department);

to detect potential transactions involving entities subject to various sanctions and embargoes

contained in the lists mentioned in the previous point;

to decide on the acceptance of clients as per the respective Policy;

to generate alerts according to the ML/TF risk classification of the clients and the behavioural

variations taken place in a given period of time;

To monitor transactions exceeding a given pre-defined value and assess whether or not they are

consistent with the client’s profile;

To fulfil the remaining legal obligations prescribed in the legislation and regulations in force.

This way, the implemented policies and procedures enable the business area of BMGCV, as a first line of

defence, to detect and report to the Compliance function any activities or patterns of behaviour that might

correspond to practices related to money laundering or terrorist financing. It is up to the Compliance

function, in turn, acting as a second line of defence, to check the compliance with the regulatory

framework to which BMGCV is subject. Finally, the Internal Audit function, as a third line of defence, is

responsible for executing efficient tests as regards the internal control system in terms of money laundering

and terrorist financing prevention.

63. Description of the involvement of the Statutory Audit Board and the corporate

commissions competent to supervise and follow up the internal control

mechanisms and procedures.

In the present three-year period, the following tasks were carried out:

Analysis to the accounts, with the purpose to validate the most significant headings of the Balance

Sheet, resorting to the Institution’s Services for collecting the information necessary to that effect.

Follow-up of the Internal Audit Directorate’s report on the deficiencies in the context of the internal

control, and the efforts made towards their correction.

Attendance at the General Meetings for approving of the accounts for the years 2017 and 2018.

The drawing up of a regulation on the operation of this Supervisory Body is still in course, and it has not

yet been concluded due to the need to change the composition of the Board. Once the process for

registration of the new members is concluded, the regulation will be assessed by the new board.

64. Description of the internal system for reporting irregularities.

As at 31 December 2018, BMGCV had no regulation for the reporting of irregularities

PART II – ASSESSMENT OF CORPORATE GOVERNANCE

1. Identification of the governance Code adopted

The present Report on the Institution Governance mirrors the governance structure adopted by the

Institution, directly associated with its organisational performance and in line with the governance

principles and practices observed by the Institution, in compliance with the recommendations laid down

in the legislation in force. Apart from the legal, statutory and regulatory provisions, all activities carried

out are also subject to the compliance with the governing bodies’ resolutions, internal rules, standards

of conduct and ethical standards. Finally, it should be noted that this document must be read as an

integral part of the Annual Report and Accounts for the financial year of 2018.

2. Analysis of the fulfilment of the Corporate Governance Code.

As established in article 3 of Notice. 7/2017, the degree of observance of the recommendations laid

down in the Corporate Governance Code of Notice 6/2017 of BCV is as follows:

RECOMMENDATIONS of Notice 6/2017 of BCV

Adopted

Non

adopted

Reference in the

Corporate

Governance report

I. MANAGEMENT

I.1. Executive Management

I.1.1. The management body must delegate the day-to-day management of the financial institution and each executive director must be specifically entrusted with certain matters.

√

Point 25

I.1.2. The management body must approve an internal regulation focused on its operation, including the operation of the executive commission.

√

Point 26

I.1.3. The directors performing executive duties, when requested by other members of governing bodies, must provide, in due time and in a manner consistent with the request, the information requested by the latter.

√ Not applicable.

I.1.4. The management body must ensure that the financial institution acts in a manner consistent with its purposes, and must not delegate its powers, particularly with regards to: (i) definition of the strategy and general political strategies of the company; (ii) definition of the corporate structure of the group; (iii) decisions that must be deemed strategical due to their amount, risk or special characteristics.

√

Point 25

I.1.5. The regulation of the management body must prescribe that the carrying out by the executive directors of executive duties in companies outside the group be previously authorised by the management body itself or by the supervisory body.

√

The regulation of the Management body was approved by the BD on 08//05/2019. Nevertheless, the whole carrying out of duties by the Executive Directors was previously authorised by the General Meeting.

I.1.6. The management body of credit institutions must include at least two resident executive members.

√ There is a resident executive member and an executive member with regular, temporary attendance.

I.2. Non-Executive Management

I.2.1. The management body must include a number of non-executive members that ensures an effective capacity for following up, overseeing and assessing the activity of the remaining members of the management body.

√

Points 21 and 25

I.2.2. The non-executive directors should include an appropriate number of independent members, considering the governance model adopted.

To that effect, an independent director is regarded as a director who is not associated with any specific interest groups in the company nor in any situation that is liable to affect their impartiality of analysis or decision, namely due to the fact:

a) That they had been a worker at the company or at a

company with whom the former is in a control or group relationship in the last three years:

b) To have, in the previous three years, provided services or established a significant business relationship with the company or with a company with whom the former is in a control or group relationship, directly or as a partner, director, manager or officer of legal person.

c) To be beneficiary of remuneration paid by the company or by a company with whom the former is in a control or group relationship beyond the remuneration resulting from the performance of duties as a director;

d) To live in cohabitation or to be married, a relative or a relative by affinity in a direct line or up to the third degree, inclusive, in the collateral line to directors or natural persons directly or indirectly holding qualified shareholding;

e) To hold qualified shareholding or to represent a shareholder holding qualified shareholding.

√

Point 21

I.2.3. If the chairman of the management body performs executive duties, this body must appoint, from among its members, an independent director who ensures the coordination of the remaining non-executive members’ works and guarantees the conditions so that these may decide independently and in a substantiated manner, or finds another equivalent mechanism that ensures such coordination.

I.2.4.

√

At the meeting of the BD of 08/05/2019 two Directors were assigned to the coordination of the committees of support to the board.

I.2.5. The management body must constitute specialised committees to support the carrying out of its management duties, according to criteria of organisational rationality and efficiency.

√

The BD, at the meeting of

08/05/2019, created the

Internal Control, Risk and

Support to Business

committees.

I.3. Diversity

I.3.1. The financial institutions must establish criteria and requirements as regards the profile of the new members of the management body that are appropriate to the duties to be performed; such profiles must take into account, apart from individual qualities (such as independence, integrity, experience and competence), diversity requirements, with emphasis on gender, that may contribute to improve the body’s performance and to the balance of its composition.

√

Points 22 and 23

I.3.2. The financial institutions must establish and release a program aimed at ensuring, until 2020, the gender balanced representation in the composition of management bodies, distinguishing between executive and non-executive management positions.

√

The selection policies aimed at ensuring the gender balanced representation in the composition of management bodies are guaranteed.

II. OVERSIGHT

II.1. The chairman of the supervisory body must be independent, according to the applicable legal criterion, and have the skills appropriate to the performance of the respective duties.

√

Points 35 and 36

II.2. The supervisory body must act as the main interlocutor between the external auditor and the first recipient of the respective reports, being in charge, namely, of proposing the respective remuneration and ensure that the conditions adequate to the provision of services are guaranteed within the institution.

√

Point 45

II.3. The supervisory body must assess the operation of the internal control and risk management systems and propose the adjustments that prove to be necessary.

√

Points 41, 55 and 63

II.4. The supervisory body shall speak on the work plans and the resources allocated to the internal audit services and to the service ensuring the fulfilment of the rules applicable to the institution (compliance), and shall receive the reports drawn up by those services at least where matters related to the settlement of accounts, identification or resolution of conflicts of interest and the detection of potential illegalities are concerned.

√

Points 41 and 55

III. INTERNAL CONTROL

III.1. The management body of the financial institution must ensure the existence of sufficient material and human resources adequate for the performance of duties and tasks inherent to the internal control system and promote the necessary training initiatives on internal control.

√

Point 55

III.2. In order to safeguard the independence of the internal control system, the heads of the internal audit, enforcement and risk management areas must report to a director who has no responsibilities with regards to the supervised areas.

√

Point 56

III.3. The financial institutions must provide for internal whistle-blowing mechanisms that enable an adequate protection for the good faith whistle-blowers.

√

Point 64

IV. REMUNERATION

IV.1. All members of the Remuneration Commission or equivalent commission must be independent from the executive board members and include at least one member with knowledge and experience in matters of remuneration policy.

√

BMGCV has no statutory RC, since that role is performed by the BD, which manages it in the framework of group policies.

Points 52 and 53

IV.2. The statement on the management and supervisory bodies’ remuneration policy must include, but not be limited to:

a) The identification and explanation of the criteria used for determining the remuneration to be granted to the members of the governing bodies;

b) Information regarding the potential maximum amount, individually, and the potential maximum amount, in aggregate, payable to the members of the governing bodies, and identification of the circumstances under which those maximum amounts can be returned;

c) Information regarding the demandability or non-demandability of payments concerning the dismissal or termination of directors’ service.

√

Point 51 and

Attachment III

Not adopted, due to the fact that the statement for the financial year of 2018 is still pending reception.

IV.3. The remuneration of the executive members of the board shall be based on actual performance and shall discourage excessive risk-taking.

√

Attachment III

Points 5.8 and 5.9

IV.4. The remuneration of non-executive members of the management bodies and the remuneration of the members of the supervisory body must not include any component the amount of which depends on the performance of the financial institution or its value.

√

Attachment III

Point 5.6

IV.5. The variable remuneration component must be globally reasonable in relation to the fixed remuneration component, and maximum limits must be set for all the components.

√

Attachment III

Points 5.7 to 5.11

IV.6. A significant part of the variable remuneration must be deferred for a period no longer than three years, and the right to the receipt of the deferred component must remain dependent upon the continuity of the company’s performance throughout that period.

√

Attachment III

Point 5.8

IV.7. When the dismissal of a director does not arise from a serious infringement of their duties nor from their unfitness for the normal exercise of their functions but, even so, can lead back to an inappropriate performance, the financial institution must be equipped with the adequate and necessary legal instruments so that to prevent any indemnity or compensation to be claimed apart from that which is legally due.

√

Attachment III

Point 11

V. INFORMATION

V.1. The institutions must provide, through their website, in Portuguese and in English, access to information that enables the knowledge on their evolution and their current situation in economic, financial and corporate governance terms.

√

Partially adopted. The BMGCV website is being updated and is under progress.

V.2. The financial institutions must provide, on their website, in Portuguese and in English, at least the following elements:

a) Reports and accounts of the institutions for the past two years;

b) Resumes of the directors in office at the financial institution.

c) Internal policies adopted by the financial institution;

d) Reports of assessment and adequacy and remaining preparatory information of the General Meeting.

√

Partially adopted. See previous point.

ATTACHMENT I

EDUCATIONAL QUALIFICATIONS AND OFFICES TAKEN BY THE MEMBERS OF THE STATUTORY

AUDIT BOARD AND THE BOARD OF DIRECTORS

STATUTORY AND AUDIT BOARD

José Manuel Jesus Martins - Chairman

Higher Institute of Accounts and Administration of Lisbon (Instituto Superior de Contabilidade e

Administração de Lisboa) Baccalaureate Diploma in Accounts and Administration – Average grade of 13

Bachelor’s Degree in Accounts and Administration of Financial Institutions – Average grade of 13,5

Certified Accountants Bar Association - Registered under no. 22980

Employee at Caixa Económica – Montepio since 19 February 1973 to 30 June 2016.

I worked at the Depositors’ Control Area and in the Administration of Properties Area and I was

Deputy Director of the Accounting Department.

Miguel Pedro Sousa Monteiro – Effective Member

Bachelor’s degree in Business Management

Higher Institute of Economy and Management (Instituto Superior de Economia e Gestão) –

Technical University of Lisbon (Universidade Técnica de Lisboa)

He currently is a member of the National Assembly of Cabo Verde

Sales Manager – Tecnicil Trading, SA

Internal Auditor of the SITA Group

Chief Financial Manager – SITA - Sociedade Industrial de Tintas, SA Financial d

Business Officer – MACRO, SA

External Auditor – Pricewaterhouse Coopers

Amílcar Gonçalves de Melo - Effective Member

Master in Business Management – ISCTE-Business School/Instituto Universitário de Lisboa

MBA in Business Management from ISCTE-Business School/Instituto Universitário de Lisboa

Higher Specialised Studies of Financial and Accounting Administration – Higher Institute of Accounts and Management

of Lisbon (ISCAL)

CPA - Becker CPA / EUA

Bachelor’s degree in Financial Control – Higher Institute of Accounts and Management of Lisbon (ISCAL)

Baccalaureate diploma in Accounts and Administration Higher Institute of Accounts and

Management of Lisbon (ISCAL)

Statutory Auditor – MFR-Sociedade de Auditores Certificados, Lda

Auditor – Alves Costa & Associados, Lda

Head of the External Trade Department and Director of the Northern and Southern Distribution – EMPA

Director of the Internal Audit Department and Chief Accountant – SHELL Cabo Verde

Fernando Manuel Ferreira Boto – Alternate Member

Attendance of Higher Education Course – Faculty of Science of Lisbon (Faculdade de Ciências de Lisboa)

Responsible for significant changes to auctions of Gold and Silver

Development of own and permanent mortgage credit

Responsible for resolution of the problems related to Compensations for Nationalisations and Expropriations

Setting-up of Exchange service

Duties performed at the Credit Board

Responsible for the 1st Credit Recovery Commission

Chairman of the Montepio Geral Cooperative for 3 years

Chairman of the Board of Montepio Geral Pensioners’ Association (Associação de Reformados do Montepio

Geral) from 1998 to 2013

Ilídio Alexandre da Cruz – Alternate Member

Bachelor’s degree in Law (Legal Sciences) at Faculty of Law of the University of Coimbra (Faculdade de Direito da

Universidade de Coimbra)

Course on Law-making at the Training and Administrative Enhancement Centre (Centro de Formação

e Aperfeiçoamento Administrativo - CENFA) and the Administration Institute of Portugal (Instituto de

Administração de Portugal - INA);

Training Initiative “Finance for Non-Financial Executives” ("Finanças Para Executivos Não Financeiros")

organised by IFAP and COPRAI;

Training Initiative “Management and Marketing” ("Gestão e Marketing") organised by the Strategic

Training Operational Centre (Núcleo Operacional de Formação Estratégica) of the Sotavento

Commercial Association (Associação Comercial de Sotavento);

Training Initiative for Trainers carried out at IFAAG;

Course of Advanced Studies in Legislation Drafting and Science of Legislation organised by the National

Assembly and Coordinated by the Constitutional Law Expert Professor Carlos Blanco de Morais of the

Faculty of Law of Lisbon (Faculdade de Direito de Lisboa);

Law, Tax Procedure and Process Course; Currently attending a Master in Public Law.

Senior Official of the Ministry of Education and Adviser to the Minister Legal Counsellor to the

President of the Republic of Cape Verde

Legal Consultant of the former Institute of Insurance and Social Security (Instituto de Seguros e

Previdência Social - ISPS), Responsible for the Services of Regulation of Guarantee Claims -

Insurance Company - and Advisor to the Deputy Director.

Barrister and Founder of the Lawyers’ Office Legal Consultancy and Services, currently Ilidio Cruz

& Associados - Sociedade de Advogados RL

Consecutively Secretary of State and Minister for the Reform of Government and Public Administration

of the Government of the VI parliamentary term.

Board of Directors

João Carlos Martins da Cunha Neves – Chairman

PhD in Economy by the University of York, UK; Master’s degree in Applied Economy by the Nova University of

Lisbon (Universidade Nova de Lisboa) and Bachelor's degree in Economy by the Portuguese Catholic

University (Universidade Católica Portuguesa) in Lisbon.

Credit Analysis Officer to Companies of Caixa Económica Montepio Geral from 2006 to 2010. PMO – Banca

Invest at Caixa Económica Montepio Geral between 2009 and 2010. Strategic, Control and Accounting

Planning Officer of Caixa Económica Montepio Geral from 2010 to 2014. Members of the Executive Board of

Directors of Caixa Económica Montepio Geral since 10 December 2014. Chairman of the Board of Directors

of Banco Montepio Geral Cabo Verde since 30 May 2017.

Luis Filipe Santos Costa – Member

Bachelor’s Degree by the Higher Institute of Economy (Instituto Superior de Economia) (1980), in the field of

Monetary Policy and International Economic Relations (14 v.)

Attendance of various specialised courses and seminars, in Portugal and abroad, namely on Capital Market,

Real Estate Market.

Member of the Board of Directors Garval (Mutual Guarantee)

Member of the Board of Directors Agrogarante (Mutual Guarantee)

Member of the Board of Directors Lisgarante (Mutual Guarantee)

Member of the Board of Directors Norgarante (Mutual Guarantee)

Executive Member of the Board of Directors of Montepio Investimento, S.A.

Chairman of the Directors’ Council of the Institute of Support to Small and Medium-Sized Enterprises and

Innovation (Instituto de Apoio às Pequenas e Médias Empresas e à Inovação - IAPMEI), and representative

of IAPMEI at the General Council of Investimento Support Fund (Fundo de Apoio ao Financiamento -

FINOVA), the managing entity of which is PME Investimentos, and Chairman of the General Council of

Portugal Ventures – Sociedade de Capital de Risco, SA.

Chairman of the Executive Commission of InovCapital and Director of PME

Investments Director in the financial area of Banco Bilbao Vizcaya e Argentaria (BBVA)

Administrative and financial director of Credit Lyonnais Portugal, S. A. (CLP)

Capital market officer at Credit Lyonnais Portugal, S. A., responsible for the primary market and

institutional investors, secondary market, investment funds and market room; -

Chairman of the board of directors of the Securities Investment Fund Management Company, CLP, S. A.;

Director, on behalf of Credit Lyonnais Portugal, of S. G. F. - Sociedade Gestora de Fundos de Pensões, S. A.

MULTINVEST - Investimentos Imobiliários, Lda. - administrative and financial director DEFINT - Estudos

Técnicos e Económicos, Lda.

COVINA - Companhia Vidreira Nacional, S. A. - Studies and Planning Department

José Carlos Sequeira Mateus – Member

Bachelor’s degree in Economy - Higher Institute of Economy and Management (Instituto Superior de Economia e Gestão) - Technical University of Lisbon (Universidade Técnica de Lisboa), Lisbon (Portugal)

Master’s degree in Mathematics Applied to Economy and Management (without

Submission of thesis) - ISEG - Technical University of Lisbon, Lisbon (Portugal) Finance & Tax Training -

Interdisciplinary Centre of Economic Studies (Centro Interdisciplinar de Estudos Económicos - CIDEC)/ISCTE

Foreign Exchange Training - APEC

Structured Products on Indexes - FUTOP

Portfólio Management Training - IMC / Derivatives’ Stock Exchange of Porto

Bond Futures - IMC / Derivatives’ Stock Exchange of Porto

Swaps Training - IFR

Options Training - JPMorgan

Eurex Certification

Official - Banco Totta & Açores - Department of Technical Research and Development -

Responsible for the Public Debt portfolio - Banco Mello de Investimentos

Sub-Director - Responsible for Fixed Income - Banco Mello de Investimentos

Head of the Treasury Department - Banco Mello de Investimentos

Director - Responsible for Funding & Liquidity at the Treasury Department - BCP - Banco Comercial Português

Director - Treasury Department - Bank Millennium (Poland)

Director Central - Global Markets Board - Millennium BCP

Head of the Financial and International Board - CEMG - Caixa Económica Montepio Geral

(Non-Executive) Director - FUTURO - Pension Fund Management

(Non-Executive) Director - MGA - Montepio Gestão de Activos (Securities Management) (Non-

Executive) Director - MGA - Montepio Gestão de Activos (Securities Management)

Director - Finibanco

(Non-Executive) Director - Finivalor - (Real Estate Funds Management)

Director - Montepio Investimento

(Non-Executive) Director - BMGCV - Banco Montepio Geral Cabo Verde

Maria Rosa Almas Rodrigues – Member

Accounts and Administration at ISCAL, and Post-Graduate studies in Audit also at ISCAL.

From 2005 to 2013, Financial Officer at the Companies of the Grupo Millenniumbcp Ageas, Grupo

Segurador, SGPS, SA. Since 2015, responsible for the implementation of the Financial System in the

Angolan Insurance Company Fortaleza Seguros, SA. Currently Financial Director of the Insurance Company.

Since 2015, Member of the Statutory Audit Board of the Companies of the Grupo Ageas Portugal Holdings,

SGPS, SA. Member of the Board of Directors of Banco Montepio Geral Cabo Verde since 30 May 2017.

João Andrade Lopes – Member

Economist, worked at Bank of Cape Verde.

Performed technical and management duties. Coordinator of Monetary

Policy. Head of the Overseas Department.

Director (2001 to 2011).

Vasco Francisco Coelho de Almeida – Alternate Member

Bachelor’s degree in Corporate Management and Administration,

June 1997, Portuguese Catholic University (Universidade Católica

Portuguesa) in Lisbon, Portugal

MBA, Darden Graduate School of Business Administration Charlottesville, VA University of Virginia

Member of the General Management & Operations, and Consulting Clubs.

Treasurer of European Society.

Banco Montepio

2016 Head of Financial Assets Follow-Up Department (Gabinete Acompanhamento Ativos Financeiros - GAAF)

2016 Head of Representative Offices Management Department

2014 Head of Relevant Exposures Follow-Up Department

2010 Head of Credit Origination and Analysis Department at the Credit Analysis Board (Assistant to the

Board).

2005 Head of Cards and Forms of Payment Department at the Marketing and New Channels Board.

2001 Marketing Board of the BCP Particulares & Negócios network

1999 Business Credit Board BCP

1997 Individuals & Business - Account Manager of individual clients.

Isabel Maria Loureio Alves Brito – Alternate Member

Bachelor's degree in Germanic Philology

BANCO NACIONAL ULTRAMARINO (1974-1985)

- Market Room Foreign Exchange, Foreign Department and Trade Finance

- Departments of: Staff, Treasury and General Operations, Operations Abroad and Management

CHASE MANHATTAN BANK (1985-1993)

- Treasury and Securities Management Board

FINIBANCO, SA (1993-2011)

- International Financial Board

CAIXA ECONÓMICA MONTEPIO GERAL (2011 …)

- International Department

ATTACHMENT II

BANCO MONTEPIO GERAL CABO VERDE, Sociedade Unipessoal, SA

ORGANISATION CHART

BOARD OF

DIRECTORS*

Chairman

João Carlos Martins da Cunha

Neves

Vice-Chairman

Luis Filipe Santos Costa

Executive Members

José Carlos Sequeira Mateus

João Andrade Lopes

Non-Executive Member

Maria Rosa Almas Rodrigues

STATUTORY AUDIT BOARD Chairman

José Manuel Jesus Martins

Effective Members

Ilídio Alexandre Cruz Quilda

Andrade do Canto Alternate

Members

Bruno Miguel Delgado Gomes Lopes

Olívio Mendes Ribeiro

CONTROL SUPPORT

Legal Counsel (Subcontracts CV)

Marketing and Image

Information Systems

Organisation

Back Office

Digitalisation and Filing

OPERATIONS **

Business Audit

Compliance Accounts and

Consolidation

Accounts (Subcontracts CV)

Control and Reporting

Treasury and Finance

Risk Management

*BOARD OF DIRECTORS – Distribution of Briefs

The briefs are allocated according to the Member’s profile, the need to segregate functions and the management

efficiency of the organisation are distributed as follows:

PERSON

RESPONSIBLE

BRIEF REPLACEMENT

João Carlos Martins da Cunha Neves

Institutional

Risk

General Secretariat

José Carlos Sequeira Mateus

Luis Filipe Santos Costa

Marketing

Processes

Organisation

João Andrade Lopes

José Carlos Sequeira Mateus

Finance

International

Maria Rosa Almas Rodrigues

Maria Rosa Almas Rodrigues

Planning

Financial Reporting

João Carlos Martins da Cunha Neves

João Andrade Lopes

Business

Legal Counsel

José Carlos Sequeira Mateus

**OPERATIONS

BMGCV

STRUCTURE

UNIT

DESCRIPTION OF POWERS NUMBER OF

WORKERS

PERSON

RESPONSIBLE

Operations Department

Contact with Clients and potential

Clients

Checking and inspection of the documentation received from Clients

Opening of Sight Deposit Accounts

Negotiation of interest rates, terms and

amount for Sight Deposit Accounts

Establishment/Reinforcement/Mobilisation of Sight Deposit Accounts

Bank Transfers

Issuance of Cheques Abroad Issuance of

Bank Guarantees Opening of Securities

Accounts

Receipt of orders from investors and

provision of services inherent to the

securities in the custody of the Bank

Recognition/regularisation movements BMGCV account management

Inspection, filing and digitalisation of all documents

Provision of information whenever requested by the competent authorities

2 1)

José Eduardo Cunha 2)

1) 2016: 3 workers;

2017: 3 workers until 10 January

2) Luisa Silva responsible in 2016, until 09 July 2017

José Eduardo Cunha, person responsible as of 10 July 2017

ATTACHMENT III

BANCO MONTEPIO GERAL CABO VERDE, SOCIEDADE UNIPESSOAL, SA

Remuneration Policy

TABLE OF CONTENTS

1. Subject matter

2. Duration

3. Scope of Application

4. Definition of the Remuneration Policy

5. Remuneration of the members of the Board of Directors

6. Remuneration of the members of the Statutory Audit Board

7. Remuneration of workers

8. Performance of duties in subsidiary companies of BMGCV

9. Profit sharing

10. Other benefits

11. Dismissal from office or termination of service

12. Duty of disclosure

1. Subject matter

The present Remuneration Policy establishes the terms and conditions for allocation of the

remuneration of the governing bodies’ members of Banco Montepio Geral - Cabo Verde,

Sociedade Unipessoal, S.A. (henceforth referred to as “BMGCV” or “Bank”), falling under

the corporate guidelines defined by the shareholder to all the Montepio Group.

2. Duration

The present policy shall be of unlimited duration, without prejudice to its updating,

revision and annual assessment.

3. Scope of Application

3.1 The present Remuneration Policy is applicable to the following members of BMGCV

governing bodies:

(a) All members of the Board of Directors (including resident and non-resident

Directors); and

(b) All members of the Statutory Audit Board

3.2 The present Remuneration Policy and the principles arising therefrom result from the

adoption by the Bank of the legal provisions applicable to its activity, as a financial

institution, laid down in article 4, paragraph 1, subparagraph h) and article 32,

paragraph 2, subparagraph c) of Statute 62/VIII/2014, of 23 April.

3.3 Apart from the aforementioned provisions, the present Remuneration Policy also

bears in mind the adoption of the recommendations provided for in the Corporate

Governance of Financial Institutions Code, published in Notice no. 6/2017 and

supplemented by Notice no. 7/2017 of the Bank of Cape Verde, which concern the

adoption of good governance criteria by the financial institutions, namely with

regards to remuneration policies.

4. Definition of the Remuneration Policy

4.1 The definition of the remuneration policy by the Management Bodies and Supervisory

Bodies falls to the General Meeting.

4.2 The definition of the Remuneration Policy particularly takes into account the

following requirements and goals:

(a) To ensure the fulfilment of the relevant legal and regulatory provisions;

(b) The economic situation of BMGCV;

(c) To promote and be consistent with a sound and prudent risk

management and discourage the assumption of excessive risks;

(d) To ensure the compatibility of the defined remuneration

mechanisms with the medium and long-term strategy, goals,

values and interests of BMGCV and of the shareholder;

(e) To structure remuneration mechanisms adequate and

proportional to the nature, characteristics, size, organisation and

complexity of the BMGCV activities;

(f) To structure remuneration mechanisms adequate and

proportional to the characteristics of the role performed.

4.3 The Remuneration Policy shall be updated and revised

whenever deemed appropriate or necessary, at least

once a year, so as to ensure, at all times, the fulfilment of the

requirements and goals contained in the previous point.

4.4 The approving of the Remuneration Policy and its updates,

revisions and remaining measures which are deemed necessary

to the adjustment of the Remuneration Policy in force is approved at

General Meeting, on a proposal submitted by the shareholder.

4.5 The definition of the remunerations and determination of the

fixed and variable components which are a part thereof, where

applicable, is the General Meeting’s responsibility, on a proposal

submitted by the shareholder.

5. Remuneration of the members of the Board of Directors

5.1 The annual fixed remuneration and, where applicable, the variable remuneration, of

the members of the Board of Directors is approved at General Meeting, on a proposal

submitted by the shareholder, at the moment of appointment of the directors for the

respective term.

5.2 For purposes of setting the remuneration amounts, the General Meeting must

take into consideration the availability, experience and professional qualifications

required and the responsibility associated with the performance of management

duties.

5.3 The fixed remuneration of the members of the Board of Directors is paid 14 times a

year, and includes the respective holiday pay and Christmas allowance, payable,

respectively and simultaneously with the monthly remuneration, in January and

November of each year.

5.4 The amount to be granted to both executive and non-executive Directors must not

exceed ECV 4,200,000.00, individually, and ECV 16,800,000.00, in aggregate.

5.5 The maximum limits prescribed in the previous point may only be granted through

resolution of the General Meeting, given the individual and collective performance of

the Directors, which is assessed by the General Meeting according to the Policy for

the selection and assessment of the members of the Board of Directors and of the

Statutory Audit Board.

5.6 The non-executive directors may not be granted a component the value of which

depends on the Bank’s performance or value.

5.7 The variable remuneration may not be granted in financial years in which the Bank

had negative results.

5.8 The amount corresponding to the variable remuneration is paid in cash, with a

maximum limit of 20% of the respective annual fixed remuneration; plus, 30% of its

value must be deferred for a minimum period of three years, with the right to the

receipt of the deferred component being dependent upon the Bank’s positive

performance throughout that period.

5.9 Without prejudice to the limits imposed onto the non-executive directors provided for

in clause 5.7 above, the granting of the variable remuneration, which may not be

dependent upon the Bank’s performance or value, shall observe the following

criteria:

(i) the individual and collective performance of the members of the Board of

Directors;

(ii) the degree of fulfilment of the global objectives of the Bank with reference to

the previous economic year;

(iii) the strict observance of the Remuneration Policy general policies mentioned

above;

(iv) the favourable and substantiated opinion issued by the supervisory body, as

regards the sustainability of the Bank’s financial situation;

(v) to be in office on the date of payment.

5.10 The variable component of remuneration can be subject to a reduction or reversal,

if the member in question of the Board of Directors:

a. Took part or was responsible for an action which resulted in significant losses to

the Bank;

b. Took part or was responsible for the adoption of an illicit behaviour which

resulted in the corruption or tampering of the performance criteria;

c. Failed to observe the adequacy and creditworthiness criteria.

5.11 The variable component of remuneration can be suspended, in case the Bank

responds for any type of liability for management acts, and such suspension is

maintained until the moment of clarification establishment of responsibilities.

6. Remuneration of the members of the Statutory Audit Board

6.1 The members of the Statutory Audit Board are remunerated through attendance

fees, the amounts of which are set by General Meeting, on proposal submitted by

the shareholder.

6.2 The amount to be granted must not exceed ECV 100,000.00, individually, and ECV

1,800,000.00, in aggregate.

6.3 The maximum limits prescribed in the previous point may only be granted through

resolution of the General Meeting, given the individual and collective performance of

the members of the Statutory Audit Board, which is assessed by the General Meeting

according to the Policy for the selection and assessment of the members of the

Board of Directors and of the Statutory Audit Board.

6.4 For purposes of setting the remuneration amounts, the General Meeting must take

into consideration the availability, experience and professional qualifications required

and the responsibility associated with the performance of management duties.

7. Remuneration of workers

7.1 The remuneration of workers is set by the Board of Directors, and is composed of:

(i) Fixed remuneration, to be paid on a monthly basis, the amount of which

results from an individual negotiation with each worker, within the scope of

the admission procedure, and may be annually updated by way of written

agreement; and

(ii) Other remuneration, such as social benefits, grants or insurance that might be

established and negotiated on a case-by-case basis.

7.2 The other remuneration mentioned in the previous paragraph might be subject to

reduction or reversal, if the worker:

(a) Took part or is responsible for an action which resulted in significant losses

to the Bank;

(b) Took part or was responsible for the adoption of an illicit behaviour which

resulted in the corruption or tampering of the performance criteria;

(c) Failed to observe the adequacy and creditworthiness criteria.

7.3 The variable component of remuneration can be suspended, in case the Bank

responds for any type of liability for management acts, and such suspension is

maintained until the moment of clarification establishment of responsibilities.

8. Performance of duties in subsidiary companies of BMGCV

No remuneration is due for the performance of duties in subsidiary companies of BMGCV,

either paid by those companies or by the BMGCV.

9. Profit sharing

The BMCV does not remunerate the members of the Board of Directors and the members

of the Statutory Audit Board through profit sharing systems.

10. Other non-pecuniary benefits

The members of the Board of Directors and of the Statutory Audit Board have no systems

for the award of annual premia or other non-pecuniary benefits; however, such systems

might be established following a proposal on part of the shareholder at General Meeting.

11. Dismissal from office or termination of service

In case of dismissal from office or termination of service of any member of the Board of

Directors or of the Statutory Audit Board of the Bank, there shall be no payment of any

other indemnity or compensation beyond those provided for under the applicable legal

provisions.

12. Duty of disclosure

In line with the provisions of Notice no. 7/2017, the Bank discloses the present Policy on

its website www.bmgcv.cv.

ATTACHMENT IV

Banco Montepio Geral - Cabo Verde, Sociedade Unipessoal, SA

Policy for the selection and assessment of adequacy of the members of the Board of Directors and Statutory Audit Board

Table of Contents

1. Subject Matter………………………………………………………………………………

3

2. Duration…………………………………………………………………………………………

3

3. Scope of Application………………………………………………………………………

3

4. Competence for the assessment of adequacy of the members of the managing and supervisory boards…………………………………………………

4

5. Determination of the methodology for assessment of adequacy……..…

5

6. Repute……………………………………………………………………………………………

5

7. Professional Qualifications….……………………………………………………………

7

8. Independence…………………………………………………………………………………

8

9. Mechanisms of prevention, communication and resolution of conflicts of interest…………………………………………………………………………………………

9

10. Availability………………………………………………………………………………………

10

11. Gender diversity………………………………………………………………………………

11

12. Procedures of Assessment……….………………………………………………………

11

13. Professional Training…………..…………………………………………………………

13

14. Disclosure…………………………………………………………………………………….. 13

1. Subject Matter

The present Policy for the selection and assessment of adequacy of the members of the

Board of Directors and Statutory and Audit Board of Banco Montepio Geral Cabo

Verde, Sociedade Unipessoal, S.A. (“Bank”), henceforth solely referred to as

“Policy”, establishes: (a) the general and objective underlying principles, (n) the

persons responsible for the assessment of adequacy, (c) the criteria for the

identification and selection of persons able to be a member of the Board of Directors

and the Statutory and Audit Board, (d) the procedures of assessment that meet the

legally established adequacy requirements and (e) the rules on prevention,

communication and resolution of situations of conflicts of interest and is aimed at

the promotion of impartial and transparent internal policies, in line with the best

corporate governance practices that govern the banking activity.

2. Duration

The present Policy shall be of unlimited duration, without prejudice to its updating,

revision and annual assessment by the General Meeting, on proposal of the

shareholder.

3. Scope of Application

3.1. The present Policy is applicable to the following members of the Bank’s governing

bodies (henceforth referred to as “Recipients”):

(a) All members of the Board of Directors; and

(b) All members of the Statutory and Audit Board.

3.2. The present Policy and the principles arising therefrom result from the Adoption by

the Bank of the legal provisions applicable to its activity as a financial institution contained

in Statute no. 62/VIII/2014 of 23 April (“LAIF”) of Notice of the Bank of Cape Verde

(“BCV”) no. 4/2014 of 17 October and of the Financial Institutions Corporate Governance

Code, published by Notice of BCV no. 6/2017 of 7 September.

4. Competence for the assessment of adequacy of the members of the managing

and supervisory bodies

4.1. The assessment of adequacy of the persons fit to be members of the Board of

Directors and the Statutory and Audit Board is the responsibility of the General Meeting.

4.2. The competence of the General Meeting includes, but is not limited to:

(a) Defining the profile, functions, competences and qualifications of the members of the

Board of Directors and the Statutory and Audit Board, given the provisions of the

Bank’s Articles of Association and the LAIF and also the adequacy requirements

necessary for the performances of the respective duties, namely with regards as

repute, experience and professional qualification, independence and availability;

(b) Assessing the adequacy of the members of the Board of Directors and the Statutory

and Audit Board to the performance of the respective duties;

(c) Checking whether the Policy Recipients to be elected or in office have the adequacy

requirements necessary for the performance of the respective duties, namely with

regards to repute, experience and professional qualification, independence and

availability;

(d) Ensuring that the collegiate body in question, considering its composition as a whole,

meets the professional qualification and the sufficient availability to fulfil the

respective legal and statutory duties in all relevant areas of activity;

(e) Determining the methodology to follow in the assessment of adequacy of the

Recipients, as well as the steps deemed necessary for observing the present Policy;

(f) Determining the requirements of prevention, communication and resolution of

conflicts of interest, namely in order to identify potential or effective situations of

undue influence, to ensure the independence in the performance of duties of the

managing and supervisory bodies;

(g) Drawing up a report on the adequacy of the Recipients to the duties they intend to

perform.

5. Determination of the methodology for assessment of adequacy

5.1. The methodology for assessment of adequacy of the members of the Board of

Directors and the Statutory and Audit Board is determined by the General Meeting, on

proposal of the shareholder, bearing in mind the confirmation that the members’ duties,

the existence, maintenance and development of their competences and qualifications and

the requirements of repute, professional qualification, independence and availability are

fulfilled.

5.2. Without prejudice to the provisions of the following paragraphs, the legal

limitations prescribed in article 441, paragraph 3, of the Commercial Companies Code and

in Notice on. 4/2014 of BCV shall always be applicable to the incompatibility to the

performance of the members’ duties.

6. Repute

6.1. The assessment of repute shall take into account the manner in which a person

normally manages their business or is engaged in their profession, particularly regarding

aspects that reveal the person’s ability to decide in a weighted and judicious fashion, so

as to fully comply with their obligations and to generally act in a manner consistent with

the preservation of the market’s confidence.

6.2. For purposes of checking the Recipients’ repute, the following elements are taken

into consideration:

(a) The survey on the professional qualification, repute and availability to be filled out by

the candidate (attached to Notice no,. 4/2014 of BCV);

(b) The information provided by the assessed person’s resume;

(c) An interview conducted, whenever deemed necessary, with the assessee;

(d) The context in which the assessee’s decisions were taken.

6.3. The assessment of the Recipients’ repute takes into account indications of lack of

repute, namely:

(a) The removal from office duties at financial entities or similar entities, on account of

decision of BCV or foreign supervisory or regulatory authority;

(b) The removal from office by public entity;

(c) The reasons determining the dismissal, termination of employment or removal from

an office that requires a special relationship of trust;

(d) Facts that determined the judicial removal or the judicial confirmation of removal with

just cause of the members of the managing and supervisory bodies of any commercial

company;

(e) Acts carried out as administrator, director or manager of any commercial company

that have determined a judgment for damages caused to the company, partners,

company creditors or third partners;

(f) The accusation, indictment or conviction in Cape Verde or abroad for crimes against

property, crimes of counterfeiting and forgery, crimes against the Justice system,

crimes practised during the performance of public duties, tax crimes, crimes specially

related to the exercise of financial and insurance activity and with the use of means of

payment;

(g) The indictment or conviction, in Cape Verde or abroad, for infringement of the rules

governing the activity of credit institutions and insurance activity;

(h) Lack of present or past cooperation with the supervisory or regulatory authorities and

indications that the Recipient failed to act in a transparent or cooperative manner in

the relations with any national or foreign supervisory or regulatory authorities;

(i) Infringement of disciplinary rules or rules governing professional ethics within the

scope of the professional activities regulated;

(j) The rejection, repeal, cancelation or cessation of registration, authorisation, admission

or licence for exercising a business, corporate or professional activity by supervisory

authority, professional body or body with similar functions;

(k) Prohibition by judicial entity, supervisory authority, professional body or body with

similar functions to act as director or manager of a civil or commercial company or to

perform duties therein;

(l) To have been director of a financial institution the authorisation of which has been

repealed or the resolution of which has been initiated during their mandate;

(m) The financial and corporate performance of companies held or managed or in which

the Recipient has maintained or maintains a significant shareholding that has resulted

in a proceeding of rehabilitation, insolvency or liquidation, as far as said Recipient has

contributed to the referred to situation; and

(n) The declaration of insolvency of the past ten years.

7. Professional Qualifications

7.1. The Recipient must have the competences and qualifications adequate to the

performance of their duties, acquired through academic qualification and/or specialised

training appropriate to the office to be taken and/or through past professional experience

in other entities of the financial sector with a duration and responsibilities in line with the

characteristics, complexity and size of the Bank, as well as with the risks associated with

the activity carried out by the Bank.

7.2. The professional experience acquired in previous offices shall be assessed

particularly bearing in mind:

(a) The length of service;

(b) The nature and complexity of the company’s complexity where the office was taken,

including its organisational structure;

(c) The scope of competences, decision-making powers and degree of responsibility;

(d) The technical knowledge acquired during the performance of duties regarding the

activity of a credit institution and the comprehension of the risks to which the credit

institutions are exposed; and

(e) The number of employees...

7.3. The experience acquired in the matters listed below is deemed to be specially

relevant for the assessment of the Recipients’ professional qualifications:

(a) Financial markets;

(b) Regulatory schemes and requirements, including those related to corporate

governance and internal control processes;

(c) Strategic planning, comprehension of the business strategy or business plan of a

financial institution and its goals;

(d) Risk management (identification, assessment, monitoring, control and mitigation of

the main types of risks of a financial institution, including the member’s

responsibilities);

(e) Assessment of the efficiency of the mechanisms of a financial institution, creation of

governance, supervision and efficient controls; and

(f) Interpretation of the financial information of a credit institution, identification of key-

aspects based on that information and appropriate controls and measures.

8. Independence

8.1. The independence requirement is aimed at preventing the risk that the Recipient

might be subject to the undue influence of other persons or entities, and promotes that

their duties be performed with impartiality.

8.2. The General Meeting checks whether there are situations liable to endanger the

assessee’s independence in the performance of their duties, on account of undue

influence of other persons or entities, namely as a result of:

(a) Offices that the Recipient takes or might have taken in the past at the Bank or at

other financial institution;

(b) Family or similar relations as well as professional relations or relations of an economic

nature that the Recipient has with other holders of managing and supervisory bodies

or of any entity of the Montepio group.

8.3. As per article 5, paragraph 3, of Notice no, 4/2014, an independent person is

regarded as a person who is not associated with any interest groups within the Bank nor

is in any circumstance liable to affect their impartiality of analysis or decision, namely on

account of:

(a) The fact that they hold or act on behalf of holders of qualified shareholdings of 2% or

more of the company’s share capital;

(b) The fact that they have been re-elected for more than two terms of office,

continuously or in an interleaved manner

9. Mechanisms of prevention, communication and resolution of conflicts of

interests

9.1. The situations of conflicts of interest shall be resolved in a weighted, transparent

and equitable manner, so as to assure an impartial treatment to the parties involved

therein, with the clients’ interests being specially weighted.

9.2. The Recipient shall report to the Chairman of the General Meeting Board any

direct or indirect interest that they, any of their relatives or entities to which they might

be professionally connected may have in a company or asset regarding which the

possibility of acquisition of shareholding, investment or provision of any service by the

Bank may be taken. In that circumstance, the Recipients shall describe the nature and

extent of such interest and, in case the interest is substantial, refrain from taking part in

the discussion and/or voting of any proposal concerning such operation.

9.3. The Recipient shall avoid any situation liable to give rise to conflicts of interests,

and a conflict of interests is considered to take place, for that purpose, whenever the

Recipient has private or personal interests that might influence the impartial and objective

performance of the respective duties. Private or personal interest of the holder of the

managing or supervisory body is regarded as any potential advantage to the Recipient,

their family members by consanguinity and marriage or their circle of friends and

acquaintances.

9.4. Without prejudice to the applicable legal and regulatory rules, no Recipient, in the

performance of their duties at the bank, may decide or speak as regards matters directly

or indirectly related to commercial companies or other entities in which they take offices

or hold economic interests or with natural persons with whom they are specially

associated.

9.5. The Recipients who, in the performance of their duties, are called to take part in

the process of assessment or decision of matter in which the treatment or outcome they

have a personal interest shall immediately report the Chairman of the body of which they

are a member.

9.6. The Recipients shall inform the remaining members of the body of which they are

a member whenever the professional occupation of a close relative is liable to give rise to

a conflict of interest. To that effect, close relatives are considered to be the spouse or

similar, relatives in the ascending or descending line or other relatives whose relationship

of proximity is liable to place the members in a situation of conflict of interests.

9.7. Until the term of the first year after the termination of the respective duties, the

Recipients must keep on avoiding any conflict of interests resulting from any new private

or professional activity.

9.8. In case of doubts regarding the existence of conflicts of interests or

incompatibilities between the duties performed at BMGCV and other activities, the

Recipients must request a prior opinion to the Chairman of the General Meeting Board.

9.9. Without prejudice to the applicable legal and regulatory rules, particularly as

regards the fulfilment of the independence requirement and the rules on accumulation of

responsibilities, the Bank shall seek that no Recipient shall be called upon to perform

duties in any matters concerning commercial companies or other entities in which they

take office or hold economic interests or concerning natural persons with whom they are

specially related.

10. Availability

10.1. Without prejudice to the rules prescribed in LAIF with regards to the accumulation

of responsibilities, the members of the Board of Directors and of the Statutory and Audit

Board shall have to demonstrate having availability for the performance of the respective

duties.

10.2. The Chairman of the General Meeting Board checks the Recipient’s capacity to

devote sufficient time to thoroughly perform the duties allocated or that they plan to

perform, particularly taking into account the nature and the particular demands of office

in question, and considering any situation that takes up their time, namely the

accumulation of responsibilities in other entities, and any other situation that reduces

their effective availability for the thorough performance of their duties.

10.3. The minimum availability for the thorough performance of the duties allocated to

the Recipient must be previously defined in the description of the position in question.

11. Gender diversity

11.1. One of the Bank’s objectives is the promotion of gender equality within the

members of the Board of Directors and of the Statutory and Audit Board, and, as such, it

undertakes, as far as possible, to attain a balanced representation of genders in the

referred to bodies.

11.2. To that effect, and without prejudice to the applicable legal and regulatory rules,

the Bank, whenever possible, adopts the following measures:

(a) Ensuring that, in the recruitment processes for members of the Board of Directors and

of the Statutory and Audit Board, candidates from both genders be considered;

(b) Favouring, in case of equal conditions, the recruitment or appointment of persons

belonging to the underrepresented gender.

12. Procedures of Assessment

12.1. The assessment of adequacy shall be carried out prior to the beginning of the

performance of duties and during the term of office whenever deemed justified by the

General Meeting, namely in case of change to the factual and legal assumptions that were

at the basis of the initial assessment, and to be carried out at least on an annual basis.

12.2. In the procedure for assessment of adequacy carried out prior to the beginning of

the performance of duties, the following elements to be presented by the assessed shall

be considered:

(a) Written statement with all the relevant and necessary information to carry out the

assessment of their adequacy, accompanied by all documents demonstrating the

information provided;

(b) A complete and updated resume, with special reference to the requirements provided

for in clause 8.3. of the present Policy;

(c) Valid and updated criminal record;

(d) Uncertified perfect copy of valid identification document;

(e) All statements and remaining documents prescribed by the applicable legislation and

regulations (e.g., survey on professional qualifications, repute and availability to be

filled out by the candidate, attached to Notice no, 4/2014 of BCV).

12.3. Once in possession of the documentation listed in the previous paragraph, the

General Meeting checks whether it is affected by insufficiencies or irregularities and

whether these can be corrected. If that is the case, it notifies the interested party(ies) to

correct them, indicating a deadline to that effect.

12.4. As soon as the process for assessment is concluded, the General Meeting draws

up the individual assessment report and, where applicable, the list of persons who, in its

opinion, present the most appropriate profile to take the office in question.

12.5. In case the General Meeting considers, in its individual report, that a candidate is

not fit to perform the respective duties, the latter’s appointment and/or hiring for taking

the office in question is expressly and automatically prohibited, except if such lack of

fitness can be corrected in a time limit that the General Meeting deems to be reasonable.

12.6. The candidate’s selection is made based on the reports drawn up by the General

Meeting and must be duly recorded in the minutes.

12.7. The procedure for assessment of the adequacy carried out during the term of

office is based on the performance of duties during the period to which the assessment is

report, with the present Policy in mind.

12.8. In case of collegiate bodies, the individual assessment mentioned in the

paragraphs above must be accompanied by a collective assessment of the body, so as to

confirm and ensure that the body, given its composition, meets the relevant requirements

of professional qualifications and availability.

12.9. The provisions and criteria established for individual assessment are applied to this

collective assessment of collegiate bodies, mutatis mutandis.

12.10. The Recipients are obliged to notify the Bank, within no more than 10 days,

regarding any material change to their professional or personal situation liable to affect

the fulfilment of the requirements for taking the office. That communication shall be sent

to the Chairman of the General Meeting Board, to the address of the Bank’s head office

and sent by email to the respective email inbox.

13. Professional Training

The Bank shall inform the Recipients of the training activities that it deems necessary

for purposes of updating their skills and increasing the basic training.

14. Disclosure

In accordance with the provisions of Notice no. 7/2017, the Bank publishes the present

Policy on its website (available on www.bmgcv-cv).

BANCO MONTEPIO GERAL – CABO VERDE, Sociedade Unipessoal, SA Head Office: Rua da Comunicação Social, n.º 2 1º E – C.P. 261 ASA – Praia Santiago CAPE VERDE

Share Capital: 992,000,000.00 ECV Legal Person Individual Number: 252232089 Registered in the Commercial Registry of Cape Verde under no. 1865. www.bmgcv.cv