March 16, 2018

FSB published two reports as part of its work to assess and address the decline in correspondent banking relationships: one is a progress report on the FSB action plan to assess and address the decline in correspondent banking and the second report is a stocktake on remittance service providers’ access to banking services. These reports have been delivered to G20 Finance Ministers and Central Bank Governors. FSB also published a short cover note, highlighting key messages to the G20 leaders.

A decline in the number of correspondent banking relationships remains a source of concern for the international community. This is because, in affected jurisdictions, it may impact the ability to send and receive international payments or drive some payment flows underground, with potential adverse consequences on international trade, growth, financial inclusion, and the stability and integrity of the financial system. The following are the key highlights of the two reports:

  • Progress report on FSB action plan. The progress report highlights actions taken to implement the four-point action plan on correspondent banking since the July 2017 update of FSB. The actions include strengthening tools for due diligence by correspondent banks; data collection and analysis; clarifying regulatory expectations, as a matter of priority, including guidance by the Financial Action Task Force (FATF) and BCBS; and domestic capacity building in jurisdictions that are home to the affected respondent banks. This is the fourth progress report and it follows the earlier reports that were published in August 2016, December 2016, and July 2017.
  • Report on stocktake of remittance service providers’ access to banking services. The report identifies intertwined drivers for the termination of banking services to remittance service providers, including profitability, the perceived high risk of the remittance sector from an anti-money laundering/counter terrorism financing (AML/CFT) perspective, supervision of remittance service providers, and, in some jurisdictions, weak compliance with international standards, particularly those relating to AML/CFT. FSB, Financial Action Task Force, Global Partnership for Financial Inclusion, IMF, and World Bank will coordinate to monitor take-up of the recommendations of this stocktake effort and report back to the G20 in July 2019. The report makes 19 recommendations in four areas to address gaps and remaining barriers to banking services by remittance service providers. The four categories of recommendations are:
    • Promoting dialog and communication between the banking and remittance sectors
    • Improving implementation of international standards and oversight of the remittance sector
    • Use of innovation in the remittance sector and its possible role in enabling remittance service providers’ greater access to banking services
    • Technical assistance related to remittances

 

Related Links

Keywords: International, Banking, Correspondent Banking, Progress Report, Recommendations on Remittances, AML/CFT, FSB

Related Articles
News

ESAs Amend Technical Standards on Mapping of ECAIs Under CRR

ESAs published a second amendment to the implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for credit risk under the Capital Requirements Regulation (CRR).

May 20, 2019 WebPage Regulatory News
News

OCC Consults on Information Collection for Home Mortgage Disclosures

OCC is soliciting comment on the revision of the information collection titled “Regulation C—Home Mortgage Disclosure.” OCC also notes that it has sent the collection to OMB for review.

May 20, 2019 WebPage Regulatory News
News

EIOPA Updates Q&A on Regulations in May 2019

EIOPA published additional questions and answers (Q&A) on guidelines, directives, and regulations applicable to insurers in Europe.

May 17, 2019 WebPage Regulatory News
News

FSB Publishes Update on Meeting of RCG for Americas

FSB published a summary of the meeting of its Regional Consultative Group (RCG) in Americas.

May 17, 2019 WebPage Regulatory News
News

IASB Issues Work Plan and Meeting Updates for May 2019

IASB published an updated work plan, along with the update of its meeting in May 2019.

May 17, 2019 WebPage Regulatory News
News

FCA Publishes Its Business Plan for the Coming Year

FCA published its Business Plan, which sets out the main areas of focus and priorities for 2019/20.

May 17, 2019 WebPage Regulatory News
News

CFTC Proposes to Amend Derivatives Clearing Organization Regulations

CFTC proposed amendments to certain regulations applicable to registered derivatives clearing organizations (DCOs) under Part 30 of the CFTC regulations.

May 16, 2019 WebPage Regulatory News
News

APRA Licenses Societe Generale As Foreign Deposit-Taking Institution

APRA granted Societe Generale a license to operate as a foreign authorized deposit-taking institution under the Banking Act of 1959.

May 16, 2019 WebPage Regulatory News
News

EBA Provides Updates on Its Work on Basel III Impact Assessment in EU

EBA is working to finalize the impact assessment on implementation of Basel III standards, in response to the EC call for advice, which was received on May 04, 2018.

May 16, 2019 WebPage Regulatory News
News

ISDA Publishes Two Consultations on Benchmark Fallbacks

ISDA published two consultations on benchmark fallbacks, the comment periods for which expire on July 12, 2019.

May 16, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3097