BARCLAYS Bank Plc will today cease to offer correspondent banking services for its former Zimbabwean unit, which it sold to Malawi’s FMB Capital last year.
FMB Capital acquired 43 percent shareholding in the Zimbabwe-listed bank from Barclays Plc, which has retained a residual interest which it will shed off over the next three years in a phased exit.
Barclays Bank Zimbabwe, which still trades under the British bank’s name until the FMB brand is introduced over the next two years, this week announced changes to its worldwide correspondent banking list.
The local bank said it had picked its new siblings in Zambia, Malawi and Botswana to facilitate international transactions.
Transactions in the Botswana pula would be processed through Capital Bank Botswana, Canadian dollar transactions through Canadian Imperial Bank of Commerce, Japanese Yen deal will go through Sumitomo Mitsui Banking Corporation, Kenyan Shillings through Prime Bank Ltd Kenya, Euros, pounds and United States dollar through Crown Agents Bank, London, while South African rand transactions would be routed through First Rand Bank Ltd and ABSA.
The end of the bank’s correspondent banking ties with its erstwhile parent was the second major development at the listed financial institution in two months, after severing ties with managing director George Guvamatanga at the end of 2017.
It signified the Malawi lender’s determination to break away from a century-old English banking tradition in Zimbabwe, where Barclays had evolved into one of the key banks in the country.
A correspondent bank is a financial institution that provides services on behalf of another, and helps facilitate international transactions through nostro accounts, which are held by domestic banks with foreign financial institutions for the purposes of paying for imports.
Transactions in which Barclays Plc entities were correspondent banks for the Harare financial institutions were only in force until yesterday, the statement said.
“Further to our email on 5 January 2018, we would like to remind you that, following the conclusion of the divestment process by Barclays Bank Plc from Barclays Bank Zimbabwe on 10 October, 2018, we have updated our correspondent banking details…,” Barclays Bank Zimbabwe said on Monday.
“The changes are with effect from 1 February 2018 and apply to any inbound or outbound payment, regardless of its purpose. To allow for a smooth transition, existing correspondent banking arrangements with Barclays Bank Plc entities will remain in place till 31 January 2018. We take this opportunity to remind all our exporters to quote the new correspondent banking details on invoices that will be issued to your regional and overseas customers. The same details should also be provided to customers from whom you are currently expecting export proceeds for the discharge of outstanding CD1s with the bank, if they become payable after the effective date,” Barclays Bank Zimbabwe said.
“In the unlikely event of any such delays being experienced, Barclays Bank of Zimbabwe Limited or FMB Capital Holding Plc and its subsidiaries cannot be held liable,” it added.