Bank of Valletta’s correspondent banking relationships
Bank of Valletta refers to Tuesday morning’s Company Announcement that was issued by the bank and to subsequent reports in the media.
ING's decision to terminate its relationship with BOV must be seen in a context where international banks are cutting down on their correspondent banking services all over the world. This is part of a general de-risking which is taking place in the banking industry following a spate of anti-money laundering failures, especially in Europe. Smaller jurisdictions like Malta are being particularly hard hit, since the volumes of business they generate are not sufficient to be of interest to the larger players, given the risks and the compliance costs involved.
The bank’s chairman Deo Scerri speaking on behalf of the bank’s board of directors stated that the bank deems it critical to have in place a network of correspondent banks that offer clearing services in the main international currencies, such as the US dollar. The bank has stepped up its efforts to find alternative USD clearing arrangements.
BOV is also undergoing a transformation programme aimed at lowering its risk profile and at strengthening its anti-financial crime structures, systems and policies.
Mr Scerri explained that this is a major change programme which is being carried out under the guidance of two global consultancy firms.
The bank’s board of directors is fully confident that this programme will enable the bank to secure alternative correspondent banking relationships well before the ING accounts are closed down in the coming December.