Regulatory Alerts2009-08-04 | TED-FEM-FPC-GEN-01-125-2009Non-Transferability Of Funds Procured From The Wholesale Dutch Auction System (WDAS) among Authorized Dealers
The Central Bank has issued guidelines to address the issue of authorized dealers purchasing funds from the Wholesale Dutch Auction System (WDAS) and selling them at the inter-bank market, resulting in a widening spread between the WDAS rates and inter-bank exchange rates. Starting from the date of this circular, authorized dealers may no longer transfer or sell WDAS funds at the inter-bank window. Instead, they should bid on their own accounts within their daily foreign exchange Net Open Position (NOP) limit and maintain a spread of no more than fifty kobo between buying and selling rates. Dealers are also required to keep records of WDAS and inter-bank transactions and make them available upon request. Failure to comply with these guidelines may result in withdrawal of the authorized dealership license.