The Central Bank of the UAE (CBUAE) has ordered an urgent and special inspection of the branches of Banque Misr in the country. This decision was made a day after US authorities published a statement proposing special measures against the Egyptian lender due to concerns related to money laundering.
In its statement, CBUAE reported that it has reviewed the notification from US authorities regarding alleged actions against Banque Misr's branches in the UAE. The US classified this financial institution as having a primary risk in money laundering operating outside the United States.
The regulator emphasized that Banque Misr's branches in the UAE continue to comply with the country's current legislation and regulations. It also reminded that banks licensed in the UAE must not expose the country's financial system to reputational risks. Furthermore, it was noted that lenders are obliged to adhere to the laws and rules of the countries whose financial institutions they use for transactions and must not abuse the advanced financial infrastructure of the UAE.
CBUAE stated that it periodically assesses Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) procedures in banks operating in the UAE, and also checks the effectiveness of sanctions screening systems and other compliance systems. Banks are required to strengthen these procedures in accordance with applicable laws and regulations.
As part of its response, the central bank decided to conduct a special and urgent inspection of Banque Misr's branches in the UAE, including forensic examination and detailed analysis of past operations for the period specified in the US statement. This inspection will specifically focus on banking transactions related to the companies mentioned in the US authorities' statement.
CBUAE added that options for the bank's future status in the UAE are currently being studied if a decision is made to apply special measures following the completion of procedures according to US law. The regulator clarified that any decision will be made in due course, taking into account the bank's obligations to its clients in the UAE.