The Malta Independent 18 November 2018, Sunday

Banks ‘entirely free to accept’ customers from Satabank – MBA

Wednesday, 7 November 2018, 15:44 Last update: about 10 days ago

The Malta Bankers’ Association (MBA) said there is nothing stopping clients of SataBank from contacting the MBA member banks to see if they are willing to on-board their business and the banks are entirely free to accept their custom.

In a statement referreing to various media reports about the situation of Satabank clients following the regulatory actions announced against the bank by the MFSA, the MBA said a delegation met with MFSA on 25 October to discuss the situation and the MBA Board met with urgency on 30 October to consider how the member banks could assist in the circumstances.

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On 31 October it was communicated to MFSA that although the MBA could not adopt a collective position on behalf of its members or direct them in any particular way, since each bank has its specific business model, risk appetite and customer acceptance policies and criteria, there was a firm resolve to support the smooth functioning of the economy and the integrity of the financial system. There was therefore nothing stopping clients of SataBank from contacting the MBA member banks to see if they are willing to on-board their business and the banks are entirely free to accept their custom.

The MBA notes that the process of SataBank account-holders enquiring and looking for new bank relationships has been in motion for some time. It must be underlined that a bank’s duty to open even a payment account with basic features for an individual, comes with commensurate obligations, also on the part of the customer, to help the bank understand well what relationship is being on-boarded, including information about the source of funds, the MBA said.

The requirement to undertake customer due diligence and monitor account conduct is a basic precept in international and local regulation, irrespective of the nationality of the customer. Where these responsibilities are not carried out, the consequences can be serious, far-reaching and banks may risk having their activities curtailed or terminated. This has regrettably been the case in a number of instances locally, including the latest Satabank developments, which has caused damage to Malta’s reputation as a leading jurisdiction for financial services.

The MBA member banks reiterated their full commitment to support Malta’s economic progress, of which they have always been key drivers, while ensuring that all regulatory obligations are adhered to.

 

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