2018年-IMF国际货币组织全球_Cabo_Verde_Selected_Issues_Paper_15页_413kb

CABO VERDE: Loss of Correspondent Banking Relationships

Core Content

This document discusses the loss of correspondent banking relationships (CBRs) in Cabo Verde and explores policy options to mitigate the potential adverse effects. It is based on a bank-level survey conducted in 2017 and the application of the minimum scope monitoring framework developed by the IMF.

Main Issues and Findings

A. Introduction

• The paper examines the impact of CBR withdrawals in Cabo Verde and suggests policy measures to address the issue.
• The survey covers all seven banks in the country and shows that CBRs are being withdrawn by both central and commercial banks.
• The loss of CBRs could affect financial stability due to the country's reliance on remittances and migrant deposits.

B. Global Trends

• CBRs are being withdrawn in many countries, including small jurisdictions in Africa, the Caribbean, Central Asia, and Europe.
• The main drivers include risk and profitability realignment, AML/CFT deficiencies, and tighter post-crisis regulations.
• In some cases, CBRs are scaled down rather than terminated, limiting access to financial services for certain customers and businesses.
• The impact on economic and financial stability has been minimal so far, but the trend could become more significant in the future.

C. Importance of CBRs

• CBRs are essential for cross-border payments, trade finance, and remittances.
• They provide critical infrastructure for international financial interactions and support economic activity.
• A well-developed CBR network can help local banks in developing countries bridge technology and risk management gaps.
• The withdrawal of CBRs could increase the cost of international transactions and reduce the availability of financial services.

D. Loss of CBRs in Cabo Verde: Bank-Level Survey Results

• The number of CBRs in Cabo Verde declined from 65 in 2015 to 62 in 2017.
• The number of active correspondent banks (ACs) also declined from 38 to 33.
• The loss of CBRs mainly affected USD transactions, although EUR and GBP CBRs were also impacted.
• The main factors behind the withdrawal are low transaction volume and AML/CFT risks.
• Banks have replaced lost CBRs with smaller, less known financial institutions, but this has not fully addressed the underlying issues.

E. Application of the Minimum Scope Monitoring Framework

• The minimum scope framework uses accounting data and is suitable for Cabo Verde due to data availability.
• The framework helps analyze the number and value of CBRs, the volume and value of transactions, and the relative importance of different currencies.
• The value of payment flows declined between 2014 and 2016, but the volume increased.
• The euro dominates payment flows in Cabo Verde, accounting for about 68% of payment values and 88% of payment volumes.
• Euro flows are concentrated through CGDI (Caixa Geral de Depositos), which handles about 70% of all euro transactions.

F. Ongoing Policy Initiatives

• The government has introduced reforms to strengthen the AML/CFT framework since 2013.
• Measures include updating AML/CFT legislation and relocating the Financial Information Unit (FIU) to the Ministry of Justice.
• The government has also established informal agreements with FIUs in Ireland and Italy.
• Commercial banks are enhancing their compliance frameworks to avoid further loss of CBRs.
• Banks have increased in-house compliance work and are replacing lost CBRs with alternative financial institutions.

G. Policy Recommendations

• Continue data collection and monitoring: Use the minimum scope framework to better understand the nature, scale, and scope of CBR withdrawals.
• Ensure efficient implementation of AML/CFT regulations: Strengthen compliance and operationalize the Inter-Ministerial Committee on AML/CFT.
• Enhance AML/CFT supervision: Improve the effectiveness of AML/CFT controls in banks to increase global trust.
• Reevaluate high-risk business lines: Terminate or limit services in sectors such as offshore banking if the risk management capacity is weak.
• Improve domestic risk management capacity: Enhance the ability of Cabo Verdean banks to manage risks through technical assistance and policy guidance.
• Improve information sharing: Foster better communication between global banks and respondent banks to clarify risk tolerance policies.
• Automate due diligence processes: Implement automated procedures for customer and beneficiary identification to improve compliance efficiency.
• Explore technological advancements: Consider blockchain and other IT solutions to reduce costs and improve risk management in the long term.

Key Information

• CBR Withdrawals: Cabo Verde has seen a reduction in CBRs since 2013, with 4% decline between 2012 and 2016.
• Impact on Economy: The loss of CBRs could affect international trade, migrant deposits, remittances, and investment flows.
• Remittances and Migrant Deposits: These account for 38% of total deposits and 11% of GDP, making them crucial for the economy.
• Currency Composition: The euro dominates payment flows, accounting for 68% of values and 88% of volumes.
• CBR Alternatives: Banks have resorted to nested relationships and smaller financial institutions, which are more expensive.
• AML/CFT Reforms: The government has made progress in updating the framework, but more work is needed to ensure compliance and independence of the FIU.

Conclusion

The loss of CBRs in Cabo Verde is a growing concern that requires coordinated policy efforts to mitigate potential adverse effects. While the impact has been minimal so far, the trend could become more significant. Strengthening AML/CFT frameworks, improving compliance, and exploring technological solutions are essential steps to address this issue.