|13 February, 2019

AMF, IMF, World Bank Group launch the second report on the withdrawal of Correspondent Banking Relationships (CBRs) in the Arab region

The report indicates that about one third of respondent banks experienced a decline in the number of CBRs accounts since 2012

The Arab Monetary Fund (AMF), the International Monetary Fund (IMF) and the World Bank are pleased to announce the publication of the second report on the withdrawal of Correspondent Banking Relationships (CBRs) in the Arab region. This report is the result of a continued and collaborative engagement by the AMF, IMF, World Bank Group, and Arab Central Banks. It summarizes the findings of a follow-up survey of Arab banks, which was conducted in mid-2018. The purpose of that survey was to assess the scale, reasons, and effects of possible withdrawal of CBRs on banks operating in the region as well as exploring the effectiveness of emerging solutions.

The survey was originated following the recommendation of the Second High-Level Regional Workshop on the withdrawal of correspondent banking relationships (CBRs), jointly organized by Arab Monetary Fund (AMF) and the International Monetary Fund (IMF) in Collaboration with the FSB and the World Bank Group, which was held in Abu Dhabi on September 17th, 2017, during which participants had highlighted the need for the AMF/IMF/WB to continue engaging with various stakeholders and monitoring trends in the withdrawal of CBRs and to explore possible solutions.

The report indicates that about one third of respondent banks experienced a decline in the number of CBRs accounts since 2012, with the average number of accounts being terminated or becoming inactive or restricted per year having increased slightly in 2016-17. Participating banks indicated that they saw the insufficient business generated from the relationships to justify the cost as the most important reason for the pressures.

Reporting banks also provided views on which solutions could help alleviate CBR strains. In this respect, they suggested that private sector efforts to establish alternative accounts or expand existing ones as the most important effort made by banks in the face of the decline. Of those that experienced a withdrawal or restriction of accounts, about 85 percent were indeed able to find replacements, notwithstanding difficulty or increased cost. They also suggested that the public sector could help alleviate CBR difficulties by improving regulation, supervision, and enforcement of AML/CFT policies, and by clarifying regulatory expectations and standards.

In this regard, AMF, IMF and World Bank Group stand ready to support further efforts in addressing CBRs issues in Arab countries in cooperation with the Central Banks in the region, and according to each institution’s mandate and expertise.

An electronic version of the report is available on www.amf.org.ae; www.imf.org; and www.worldbank.org.


© Press Release 2019

Disclaimer: The contents of this press release was provided from an external third party provider. This website is not responsible for, and does not control, such external content. This content is provided on an “as is” and “as available” basis and has not been edited in any way. Neither this website nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this press release.

The press release is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Neither this website nor our affiliates shall be liable for any errors or inaccuracies in the content, or for any actions taken by you in reliance thereon. You expressly agree that your use of the information within this article is at your sole risk.

To the fullest extent permitted by applicable law, this website, its parent company, its subsidiaries, its affiliates and the respective shareholders, directors, officers, employees, agents, advertisers, content providers and licensors will not be liable (jointly or severally) to you for any direct, indirect, consequential, special, incidental, punitive or exemplary damages, including without limitation, lost profits, lost savings and lost revenues, whether in negligence, tort, contract or any other theory of liability, even if the parties have been advised of the possibility or could have foreseen any such damages.

More From Press Releases