The $55 million penalty imposed by US regulators on the National Bank of Pakistan were for “historical compliance program weaknesses and delays in making compliance-related enhancements”, according to the bank’s President Arif Usmani.
In a letter issued to the Pakistan Stock Exchange (PSX), the NBP President outlined that “there were no findings of improper transactions or willful misconduct. “US regulators have recognized the many positive changes resulting from new management.
The National Bank of Pakistan and the New York branch are fully committed to satisfying the regulators’ expectations,” he added.
Usmani mentioned that since May 2020, “the New York branch has been under new management and has substantially enhanced its compliance program. US regulators have recognized the many positive changes resulting from [the] new management.
The National Bank of Pakistan and the New York branch are fully committed to satisfying the regulators’ expectations”.
The United States Federal Reserve announced a $20.4 million (Rs. 3.6 billion) penalty against NBP in a statement on Thursday. The board’s decision was made in tandem with a decision made by the New York State Department of Financial Services (NYDFS).
The NYDFS also fined NBP $35 million (Rs. 6.1 billion) for repeated compliance failures (now referred to as historical failures), bringing the total penalty to $55 million (Rs. 9.7 billion).
Last year, the NBP was fined Rs. 280.5 million by the State Bank of Pakistan (SBP) for violating regulatory guidelines on anti-money laundering, asset quality, foreign exchange, and general banking operations (GBO).
In 2015, NBP’s New York office was ordered to pay a $28,800 penalty to the US Treasury for alleged violations of US sanctions, which were later cleared.
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