Earlier in the day, the Central Bank of Kenya released a statement in which it outlined a series of regulatory actions that it had taken against Absa.
This was due to some forex transactions which according to the CBK had been done without conducting standard checks on anti-money laundering. The regulator also noted that Know Your Customer (KYC) requirements were not applied. As a result, Absa was ordered to reverse the transactions and at the same time to stop transacting as authorized forex dealers as from 9th to 15th April 2020.
Absa Bank on its part has stated that the transactions were executed on behalf of highly reputable global financial institutions, which are regulated in line with best international practice. The bank also noted that the transactions were executed at prevailing market rates.
However, due to the issues raised by the CBK, Absa has indicated that they decided to proactively cancel the two foreign exchange forward transactions concerned. The decision to cancel the transactions was reportedly taken to demonstrate their willingness to address fully the concerns of the regulator.
The bank further indicated that they are in consultations and discussions with the CBK to fully resolve all matters raised in the shortest possible time.