As part of its Corporate Governance and in compliance with applicable regulations and best international practices, MMG Bank Corporation has established an Audit and Risk Evaluation Committee with the main purpose of assisting the bank`s Board of Directors in its oversight and supervision of the operations, processes and controls with respect to financial reporting and risk management.

The Committe wil specifically oversee:

• The integrity of the banks` financial statements and the financial reporting process, as well as the effectiveness of its internal controls.
• The quality and effectiveness of the intenal auditors who report directly to the Committee.
• The external audit process, which includes hiring the external auditors as well as reviewing their qualifications, independence and performance.
• The identification, evaluation, mitigation and management of the different risks the bank is exposed to, in the course of its normal business.
• The bank`s compliance with all legal and regulatory requirements as well as the ethical conduct policy established by the Board of Directors.
• Any other task assigned by the Board of Directors.

The Committee is composed by no less than three members of the Board of Directors that do not participate in the bank`s management. The members must possess the financial knowledge and experience needed to fulfill the responsabilities of the position, and at least one member must be considered a “financial expert”. At present, the committee`s members are: José Castañeda (Chair), Mario de Diego, Roberto Lewis and Luis Valleé.

The Committee meets once a month and meetings are attended regularly by the Chief Executive Officer, the Executive Vicepresident, the CFO, the Risk and Compliance Officers, the internal auditors and, when deemed appropiate, the external auditors and any other bank officer or advisor. At least once a year or whenever it is considered necessary, the Committee meets privately and in separate sessions with the bank`s top management, internal auditors and external auditors.

The Committee`s decisions are approved and adopted by a simple majority vote and are registered in writing or electronically into a minutes ledger.

The Committee presents a report of its activities and importnat topics at each Board of Directors meeting along with its observations oe recommendations and at least once a year presents a full report of its activities.