On December 19, 2016, the Financial Stability Board published an
updated progress report outlining its action plan to assess and
address the decline in correspondent banking. Correspondent banking
relationships enable banks to access financial services in
different jurisdictions and provide cross-border payment services
to their customers. There has been an increasing concern about the
decline in the number of correspondent banking relationships
because the ability to send and receive international payments
could be impacted, which may have repercussions on growth and the
stability and integrity of the financial system. The FSB presented
a four point action plan to the G20 in November 2015. The progress
report describes the progress that has been made and outlines the
deliverables for 2017 to further address the issues.
Among the actions listed, the FSB is to publish a report in
April 2017, outlining the findings from its recent survey on
correspondent banking and from the end-2016 update of SWIFT data.
By March 2017, the FSB will publish suggested main elements (in
terms of both contents and modalities) of a communication strategy
that jurisdictions could follow in an effort to build trust by
communicating the steps taken to improve their anti-money
laundering/counter-terrorist financing frameworks and the quality
of their supervision of financial institutions. The FSB will
continue its discussions with SWIFT and, by April 2017, will
publish the process and scope of data for the ongoing monitoring of
trends in correspondent banking. The Basel Committee will also
publish its revised guidance on correspondent banking by June 2017.
The Basel Committee launched a consultation on the proposed
revisions to its guidance to confirm regulatory expectations on the
assessment of money laundering and financing of terrorism risks in
The proposed revisions to the guidelines develop the application
of a risk-based approach for correspondent banking relationships,
including recognizing that not all correspondent banking
relationships carry the same level of risk, and also clarify
expectations regarding the quality of payment messages and the
conditions for appropriate use of "know your customer"
(KYC) utilities. The consultation closes on February 22, 2017. The
consultation follows the publication by the Financial Action Task
Force of its guidance on correspondent banking on October 21,
On March 7, 2017, it will be one year since the U.K. Financial Conduct Authority's senior managers and certification regime came into force, heralding a new era of personal accountability in the financial sector.
On January 31, 2017, the FCA published a final notice issued to Deutsche Bank AG and fined the bank Ł163 million for failing to maintain an adequate AML control framework between January 1, 2012 and...
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