Standard Bank can now perform foreign exchange activities in the country. The decision is from the Bank of Mozambique

Standard Bank já pode realizar actividades cambiais no país. A decisão é do Banco de Moçambique

The Bank of Mozambique has authorized Standard Bank to carry out foreign exchange conversion activities with its clients, after suspending the institution from the foreign exchange market for "serious infractions"a note from the regulator released this Friday indicates.

"Standard Bank Mozambique is authorized to conduct foreign exchange activities of currency conversion with its clients, effective July 26, 2021," the central bank note said.

Despite this authorization, the regulator continues, that commercial bank is still barred from participating in the Interbank Foreign Exchange Market.

"Standard Bank may not quote exchange rates, and must, for the purposes of transactions in foreign currency with the public, use the reference exchange rate published by Banco de Moçambique, which results from the quotations of the commercial banks participating in the Interbank Foreign Exchange Market," clarifies the regulator's note, which adds that it continues to monitor the activities of Standard Bank, through the resident inspector it appointed.

Standard Bank's suspension from the Interbank Foreign Exchange Market was announced on June 23rd and, on the following day, the Mozambican central bank announced the opening of three "contravention processes" against that banking institution and two of its employees, namely Adimohanma Chukwuama and Carlos Madeira, who are disqualified from holding positions in credit institutions for six years and were forced to pay fines of six million meticais and 14 million meticais, respectively.

The commercial bank was also forced to pay a fine of 290 million meticals, after "serious violations" were found during inspections, most notably fraudulent manipulation of the exchange rate.

Central bank data released in April indicated Standard Bank as the third in the list of the three systemically important banks in Mozambique, in a list led by Banco Comercial e de Investimentos (BCI) and in which Banco Internacional de Moçambique (Millennium Bim) is in second position.

In the ratio that measures the importance to the sector, labeled with the English acronym D-SIB, BCI tops the list with 278 points, followed by Millennium Bim with 257 and Standard Bank with 159.

According to the Confederation of Economic Associations of Mozambique - CTA, the largest employer in the country, 45% of the monthly import volume in Mozambique was made through Standard Bank, which was generating uncertainty in the business fabric.

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