2. Main projects developed in 2007

2. Main projects developed in 2007 2.1 Representing the sector s interests A) Eurofinas Directors and Executive Committees In its capacity as a member of Eurofinas - European Federation of Finance House Associations, ASFAC was an active participant at the meetings of its Executive and Management Committees in order to thereby ensure that the interests of its associates and the Portuguese consumer credit sector continue to be defended at all times. At those meetings, ASFAC closely followed the revision of the consumer credit directive as well as the impact of the new Basel II agreements on capital adequacy and its transposition into E.U. legislation (The Capital Adequacy Directive - CAD III), and on Action Plans for the Financial Services Industry. B) Specialised Committees In addition, and always intent on ensuring that the interests of our domestic sector are adequately defended in such E.U. institutional forums, the Association was also actively involved in the dealings of a number of technical committees addressing statistics, legal issues, public relations, and economic analysis, duly reporting all relevant findings and information released by those committees to the associates. C) Annual Eurofinas/Leaseurope Conference ASFAC attended the Annual Eurofinas/Leaseurope Conference which took place in Edinburgh, in October 2007. The Association was invited to present its projects to foster financial education in our country to the conference s Consumer Credit Panel, for which it was represented by its Secretary-General. D) 7th International Financial Services Conference For the first time, ASFAC attended the International Financial Services Conference, which marked its seventh edition focused on the theme Regulation, Education, and Cooperation in Responsible Financial Services Stakeholders Council for the first time. ASFAC was represented by its Executive Chairman at this conference, which is organised by the ECRC- European Coalition for Responsible Credit. 2.2 Specialised skills training Skills training provided by APS the Portuguese Insurance Association ASFAC and APS The Portuguese Insurance Association has entered into an agreement to provide ASFAC s associate organisations with training in insurance mediation to be conducted by APS. The agreement will be in effect until December 2009 and avails advantageous conditions on organisation and pricing to interested parties. 2.3 ASFAC and EUROFINAS Stats ASFAC continued to gather statistical data from its associates with a view to compile the sector s quarterly and annual performance indicators. Subsequently, the data was analysed and released to the media. In the European context, ASFAC remained an active participant at the Statistics Committee of EUROFINAS, through the exchange and comparative analysis of statistical information on the performance of the domestic and European consumer credit markets. Still within the scope of that activity, ASFAC distributed the relevant European sectorial stats and their comparative analysis with the Portuguese

sector to all associate members. 2.4 Raising awareness of the sector s activities Media With a view to raise the public s awareness of the specialised consumer finance sector, regular contact has been maintained with the media, namely with those publications which specialise in this area. In addition to addressing all requests from journalists for information and clarification on related issues and to releasing the sector s performance indicators, the Association promoted the publication of a number of news items of financial education content. As a matter of fact, ASFAC is strongly committed to developing this area: one of the Association s objectives is to contribute to the fostering of increased financial literacy among the Portuguese. In this context, and under the scope of the Association s alliance with the RTP2 Channel which dates back to 2005, ASFAC participated in a number of TV programmes (either in the studio or through news reports) concerning specialised finance and financial education matters. The following themes were addressed: How to make an expenses budget - January 5 If you see it, you want to check it out - March 19 Managing debt - March 23 Submitting your tax returns quickly and correctly - April 20 Fraud: how to protect yourself - June 26 Is it worth investing in a college degree? - September 17 Indebtedness and Consumption - September 25 Divorcing and dividing joint property - November 21 Christmas Season Intelligent shopping - November 26 Whenever the themes in question related to financial education, credit, or money management, ASFAC was invited to participate in those TV programmes, which clearly highlights the importance of the Association s role when it comes to such matters. ASFAC was also a participant in the RTP2 Channel s Advertisement TV programme which was dedicated to consumer over borrowing, having tried to defend the interests of the consumer credit sector in that particular instance, since the sector is often held responsible for putting consumers in such a quandary. Moreover, ASFAC continued to sponsor a fortnightly item on personal finance management titled Making Ends Meet which is broadcast together with the Essence TV programme on the Sic Mulher Channel, where it is represented by its Secretary-General. After the programme ceased to be broadcast in July 2007, ASFAC was invited as member of the team hosting a new early-evening programme called Women s World, presented by Adelaide Sousa; the new programme includes an item ("At the End of the Day") which is solely dedicated to financial education and the management of personal finance. Legislative Newsletter With a view to disseminating information on what s new as far as legislation and regulatory requirements considered relevant to the domestic credit sector, ASFAC issues and distributes a fortnightly newsletter, compiled in conjunction with Attorneys Raposo & Bernardo, to its associate members. In addition, the newsletter also contains legal opinions on regulatory issues. Yearbook the Specialised Consumer Finance Industry in Portugal

ASFAC issued the second edition of its Specialised Consumer Finance in Portugal Yearbook. The yearbook was distributed to all associate members of ASFAC and was released to select media outlets (at critical moments) and to the various entities which are involved with the sector s activities in one way or another. Compendium of Legislation In 2007, ASFAC prepared the release of a Compendium of Legislation (which regulates the specialised credit sector) for publication, namely including legislation which directly regulates consumer credit, financial leasing and factoring with remissions, jurisprudence, and notes to facilitate its perusal, interpretation, and effective application. The compendium is due to be published by Livraria Almedina in 2008. Compendium of Jurisprudence On par with the Compendium of Legislation, ASFAC decided to also compile a Compendium of Jurisprudence as applicable to the sector, namely with regard to consumer credit, financial leasing and factoring. The objective is to facilitate consultation and use of available information of relevance related to the subject. Trends in the Specialised Finance Industry Seminar In November 2007, ASFAC hosted a rather successful seminar on Trends in the Specialised Finance Industry. The objective of the seminar was to provide a forum where domestic and international experts and the sector s agents could analyse key current issues which are having a major impact on the sector s activities. 2.5 Collaboration with Sectorial Entities During 2007, ASFAC continued to interact and exchange information with consumers and their representative organisations, namely the Portuguese Directorate-General for Consumers, the State Secretariat for Commerce, Competition, and Consumer Protection, local government Consumer Information Bureaus, and the DECO organisation, with a view to optimising communications among all parties involved and increasing the financial acumen of its associate members clients with regard to how the latter conduct their business. ASFAC maintained institutional relations with Portugal s Consumer Indebtedness Observatory with regard to all issues relating to the specialised finance industry, namely information, regulations, and so on. 2.6 Appointment of a Fraud Prevention Task Force With a view to defining the Association s priorities on the matter of fraud prevention, ASFAC appointed a dedicated task force to this end. As a function of the set priorities, the task force has been holding discussions with the Ministry of Justice, Bank of Portugal, and, more recently, the Registrar and Notaries Public Institute, with the objective of entering into agreements for purposes of obtaining access to the issuance dates of Identification Documents (ID s), as a means of combating fraud in instances where frauds are attempted based on stolen ID s. Hand in hand with this initiative, ASFAC has also contacted the Portuguese Judiciary Police and discussed the possibility of providing training to credit risk departments on the procedures to be followed in instances of fraud detection, in order to thereby strengthen the prevention of fraud. 2.7 Simplex Programme and Citizen

Card ASFAC was consulted under the scope of the implementation of the government s Simplex Programme, which aims to combat bureaucracy and simplify the country s public administration procedures and requirements. 2.8 Study: How the Portuguese Relate to Money and Credit ASFAC commissioned a study on "How the Portuguese Relate to Money and Credit" based on a survey undertaken early in 2008. The main objective of the study was to analyse how Portuguese consumers relate to money and to survey their borrowing habits. 2.9 Credit Liabilities Central ( CRC ) of the Bank of Portugal ASFAC was an active participant at the meetings of the Bank of Portugal s Task Force, appointed in February 2002, which resulted in the issuance of a new Credit Liabilities Central model in late 2007. Inter alia, the new model envisages the CRC Bureau to begin operating on-line 24 hours a day, seven days a week, a feature which has long deserved the support of ASFAC, as well as considers the possibility of enabling the decision-making models used by credit institutions with integrated access to the CRC. According to the forecasts, testing of the new model will be conducted by the country s five major banks by the middle of 2008 and it will be implemented before the end of 2008. 2.10 Promotion and defence of the activities and interests of associates Consumer Code Regulations on overborrowing and advertising regulations Throughout 2007, ASFAC was particularly keen to follow up on possible developments in the process of public consultation on Portugal s Consumer Code project, with consultations beginning in 2006. The Association was particularly concerned with addressing all issues related to the regulations on overborrowing and advertising which is expected to be included in this Code. Proposal to revise the Consumer Credit Directive ASFAC followed up on and was directly involved in the lobbying conducted at the European level by Eurofinas, with a view to ensure that the interests of the domestic consumer credit sector would be protected. Basel II Capital Adequacy Directive Task Force ASFAC was actively involved in the Basel II implementation process as far as the revised Capital Adequacy Directive (CAD III) was concerned, namely through numerous consultation made by the Bank of Portugal during 2007. VAT payment on a pro-rata basis Subsequent to its submission of an application and following joint recommendations by ASFAC and APLF (The Portuguese Leasing and Factoring Association) in December 2006, ASFAC followed up on the process to institute VAT payment on a pro-rata basis with the relevant tax authorities. As far as this process is concerned, ASFAC s goal is to prevent recurrence of the actualistic and legally groundless interpretation which the country s Tax Offices have made in certain instances with respect to the calculation of VAT payment on a pro-rata basis. Insurance mediation Subsequent to the introduction of a new approach

to insurance mediation by ASFAC s associates which offer their clients credit risk coverage, the Association followed up on the regulation and interpretation of the new approach. In January 2007, ASFAC secured the Portuguese Insurance Agency s commitment to apply the new approach in a manner which is adequate for catering to the business requirements of associate members. Deposits on Call by the Courts With regard to the amendments to the execution of court orders, as well as with a view to follow up on the impact of the new dispensation for purposes of ensuring that deposits which have been placed with the Courts by order until now are promptly transferred to the creditor entities ASFAC has continued to lobby the Ministry of Justice, hoping to secure the introduction of the required amendments to the applicable legislation. Speed of execution of Court orders As concerns the execution of Court orders, and with a view to increase the speed of their processing, ASFAC has submitted several recommendations to the Ministry of Justice aimed at protecting the interests of creditors. 2.11 Promotion of Financial Education ASFAC website We are pleased to report a high volume of visits to ASFAC s website (325,000) during 2007 the figure is ten times greater than that of the previous year and visitors were particularly keen on perusing the website s financial education area. This conclusion warrants our assertion that the revamping of ASFAC s website in 2006 has certainly contributed to raise the public s awareness of the sector as a more socially responsible sector. "First ASFAC Scriptwriting Competition - Shine a light on your Arguments". Subsequent to analysis of the scripts submitted to ASFAC under the aforementioned competition, the Association announced its winner in March 2007 by means of a press release and an advertisement published in the Público newspaper. Bruno Urbano, the winner, received a cheque for 2,500 from the management of ASFAC. Partnership with the Sintra City Council ASFAC provided training to technical personnel of the welfare services of the Sintra Town Council over the course of two training sessions. The objective of those training sessions was to endow the City Council s professional personnel who often deal with families in dire financial straits with financial education. A range of themes, such as the importance of budgeting for monthly expenses, restructuring one s personal finances, and the importance of establishing financial objectives was addressed. Towards the end of the year, the Association entered into an agreement with this City Council for purposes of providing further training on financial education to its staff. Partnership with the Ministry of Education In addition to the work developed last year, and pursuant to receipt of the Ministry of Education s views on various proposals submitted by ASFAC, the Association has been reviewing its financial education projects. It is important to highlight that some of the envisaged action plans are already quite advanced, being scheduled for implementation in 2008. Participation in TV programmes As reported in paragraph 2.4 of this section, and with a consistent view to inform and educate viewers on how to manage their personal finances, ASFAC has

been actively participating in a number of TV programmes being broadcast by various TV channels.