The JMMB Group Limited has cut down on the amount of cash in foreign exchange that clients can invest or place on deposit.

The group says it will allow no more than $500 in cash in foreign exchange to be deposited to accounts daily and no more than $1500 monthly.

Currencies involved are United States dollars, the British pound sterling, the Euro and the Canadian dollar.

Additionally, a new charge of one per cent of account balance plus GCT will be applied to all deposits exceeding $499 monthly.

JMMBs other banking channels including banking machines, cash deposit accounts at NCB and Sagicor are also affected by the restriction.
However the restriction on cash will not apply to funds converted to Jamaican dollars, or funds used to pay foreign currency loans.
The group says clients with funds above this limit should use available electronic channels or its cambio services.

Businessuite understands that the action taken is related to de-risking activities that are being pursued by correspondent banks internationally, which place limitations on cash from banks in the Caribbean .

IN a 2015 report on countries affected by a decline in correspondent banking relationships, the World Bank (WB) and , titled “Withdrawal from Correspondent Banking; Where, Why, and What to Do About It,” said the Caribbean was the worst affected world wide.

A majority of banking authorities in the Caribbean region reported a significant decline in correspondent banking relations (CBRs) during the survey period WB said.

In total, 89 per cent of jurisdictions reported experiencing significant to moderate declines in their foreign CBRs. Of the 19 respondent authorities, 15 reported significant declines and two others noted a trend towards decline or a moderate decline with no significant impact on the banking system overall.

The withdrawal of relationships is related to implementation of international AML/CFT (anti-money laundering and combating the financing of terrorism) standards.

Several local banks are doing all in their power to remain in the good graces of the correspondents with which they still maintain relationships.

They rely on foreign correspondent banking under which they are provided with a current or other liability account which they use for the execution of third-party payments and trade finance, as well as its own cash clearing, liquidity management and short-term borrowing or investment needs in a particular currency.

“Smaller banks are particularly dependent on such relationships to be able to offer payment and clearing services in foreign currencies,” the WB banking report states.