Jamaica National secures correspondent banking partners in LondonWednesday, January 20, 2021
BY DURRANT PATE
JAMAICA National (JN) has successfully secured correspondent banking relationships in London.
JN, through its recently launched London banking subsidiary, has secured correspondent banking relationships with two banks in the England capital. They are ClearBank, which operates throughout the United Kingdom, and the popular NatWest Bank.
JN Group Chief Executive Officer Earl Jarrett, who made the disclosure at last Wednesday's Observer Business Forum, said the struggle continues to get correspondent banking relationships in America.
He admitted that the difficulties encountered in getting correspondent banking relations with international banks prompted JN to set up its own bank in London, which was officially launched in the second half of last year. Correspondent banking relationships are needed for executing international banking transactions and holding hard currencies for local banks.
Jarrett pointed to the imperative of small island states like Jamaica securing correspondent banking relations, arguing that banks in these countries are left at the mercy of international banks in executing international transactions.
Given this reality, the JN Group CEO declared that his financial group has been working hard in securing correspondent banking relations.
"We still have a few [correspondent banks], but we continue to hunt for new correspondent banks. As I speak we've reached out to a number of [correspondent] banks," Jarrett said.
He told the Observer Business Forum that JN has been using its diplomatic channels to get introduced to correspondent banks, as well as utilising friends in overseas markets. According to Jarrett, "whenever we could fly abroad, I will always visit some banks trying to get them to support us".
DIPLOMACY NEEDED TO SOLVE CORRESPONDENT BANKING CONUNDRUM
He made the point that the correspondent banking issue requires a diplomatic rather than a banking solution, advising that regional governments need to solve the conundrum through these diplomatic channels. Jarrett posits that, "It all starts in Washington. It's the US that sets the rules and the rest of the world will follow. That's what we have been told in London – that we should start in Washington."
The JN CEO stated that as soon as the COVID-19 situation is cleared up, regional governments should begin the process of negotiations and advocacy to get correspondent banking services to the region.
Jarrett admitted that the Financial Action Task Force (FATF) shortcomings encountered by Jamaica, which led to the country being blacklisted, has exacerbated the correspondent issue.
He highlighted that the FATF noncompliance has more to do with non-banking issues such as how lawyers operate, how facilitators of transactions operate, as well as how the gaming industry and the real estate sector operate.
Generally, Jarrett said FATF is interested in how the various facilitators of transactions are managing their operations. He made reference to the announcement by Finance Minister Dr Nigel Clarke that Jamaica should be removed from the blacklist, sharing that "I know that they have been doing significant work to achieve that."
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