Republic of the Marshall Islands: Selected Issues
IMF Staff Country Reports, September 10, 2018
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- Republic of the Marshall Islands: Selected Issues
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Bibliographic details
- Published: September 10, 2018
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484375785.002
Overview
- Publication date: September 10, 2018
- Publication type: IMF Staff Country Reports; Country Report No. 2018/271, Issue: 271, Volume: 2018
- Pages: 21
- DOI: https://doi.org/10.5089/9781484375785.002
- ISBN: 9781484375785
- ISSN: 1934-7685
- Subject areas: Anti-money laundering and combating the financing of terrorism (AML/CFT), Banking, Blockchain and DLT, Correspondent banking, Crime, Currencies, Financial services, Money, Technology, Virtual currencies
Correspondent Banking Relationships (CBRs) pressures — key findings
- RMI’s two banks currently have access to the US financial system.
- Weak implementation of the anti-money laundering and combating the financing of terrorism (AML/CFT) framework by the authorities contributes to CBR pressures in RMI.
- The termination of BOMI’s CBR with First Hawaiian Bank would be expected to have significant negative economic repercussions without alternative arrangements.
Banking sector characteristics described
- The Bank of the Marshall Islands (BOMI) is a domestic financial institution providing banking services to a substantial portion of the population.
- BOMI operates five branches throughout RMI, including on the Kwajalein Atoll.
- RMI, through the Trust Company of the Marshall Islands, provides offshore corporate and maritime registry services.
AML/CFT implementation and reform steps
- The RMI authorities are strengthening the effectiveness of the AML/CFT framework.
- Additional steps should be taken to further lower the risk of losing the last US dollar CBR.
- Once the national risk assessment is completed, an action plan should be developed to address the identified risks.
Policy implications and recommendations
- Strengthen implementation and effectiveness of AML/CFT controls to reduce CBR pressures.
- Complete the national risk assessment as a priority.
- Develop and implement an action plan based on the national risk assessment to address identified AML/CFT risks and lower the likelihood of losing US dollar correspondent banking relationships.
Source: Republic of the Marshall Islands: Selected Issues (IMF Staff Country Reports), September 10, 2018.
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- Country Report