Regulatory Alerts2012-11-16
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Bank of Zambia Circular 20/2012 on Operation of Foreign Currency Accounts
The Bank of Zambia issued Circular 20/2012 to revise the operational mode of foreign currency accounts held locally within the country. The directive prohibits commercial banks from facilitating transfers of funds between foreign currency accounts, whether within the same bank or between different banks, with immediate effect. Permitted uses are strictly limited to international transactions, deposits or withdrawals, currency exchange at market rates, and specific inter-account or interbank transfers for customers holding multiple accounts.
BANK OF ZAMBIA
OFFICE OF THE DEPUTY GOVERNOR - OPERATIONS
November 16, 2012
CB Circular No: 20/2012
To: All Commercial Banks
OPERATION OF FOREIGN CURRENCY ACCOUNTS
The Bank of Zambia wishes to advise all commercial banks that it has revised the mode of operations of foreign currency accounts held locally. With immediate effect, commercial banks shall not facilitate any transaction involving the transfer of funds from one foreign currency account held locally to another either within or between banks.
Accordingly, foreign currency accounts will only be used for the following purposes:
- International transactions, that is, receipts and payments of funds with parties outside the country;
- Deposit or withdraw foreign currency with respective commercial banks;
- Purchase or sell foreign currency at prevailing market rates using the foreign currency account;
- Where customers have multiple accounts, inter account transfers with their respective commercial banks is allowed and;
- Similarly, customers that have multiple accounts with different commercial banks, interbank account transfers with their respective commercial banks are permitted.
The Bank of Zambia expects commercial banks to comply with this directive and the effect of this circular communicated to customers.
Bwalya K. E. Ng'andu (Dr)
DEPUTY GOVERNOR – OPERATIONS
Bank Square, Cairo Road P.O. Box 30080, Lusaka, Zambia Tel: 260-211-226844, 228888/9 Fax: 260-211-237070 E-mail: bngandu@boz.zm http://www.boz.zm
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