Regulatory Alerts2025-11-07
Guidance for Licensed Financial Institutions on Correspondent Banking and Expectations for Managing Correspondent Banking Relationships
The Central Bank of the United Arab Emirates issued this guidance to establish expectations for Licensed Financial Institutions regarding the management of correspondent banking relationships and associated anti-money laundering, counter-terrorist financing, and proliferation financing risks. The document mandates that institutions implement robust risk-based policies, including enhanced due diligence for high-risk relationships, nested accounts, and payable-through arrangements, while strictly adhering to cross-border payment monitoring standards. It further requires LFIs to maintain comprehensive governance, ongoing transaction monitoring, and suspicious activity reporting mechanisms to ensure compliance with UAE statutory obligations and international best practices.