(Bloomberg) -- Swiss bank BSI SA said its Singapore unit is “operating normally” as the withdrawal of its license by the regulator will only take effect at some time in the future. The unit is in a “very comfortable position” in terms of liquidity, the bank said.
The Monetary Authority of Singapore’s decision to remove the unit’s status as a merchant bank “will take place only at a future time,” given that the regulator will allow the transfer of its assets and liabilities to the Singapore branch of EFG International AG or to “the parent entity BSI SA,” the bank said in a statement Wednesday. Swiss-based EFG is in the midst of buying BSI from Brazil’s Grupo BTG Pactual.
The Singapore authorities said Tuesday they would withdraw the bank’s license for breaches of money laundering rules and impose S$13.3 million ($9.6 million) in financial penalties for 41 breaches, including failure to conduct due diligence on high-risk accounts and monitor suspicious customer transactions. The authorities referred six senior BSI executives to the public prosecutor, including the former chief executive officer in the city state and his deputy.
Singapore’s move came as Swiss authorities took action against the bank related to money flows from 1Malaysia Development Bhd., or 1MDB. Switzerland’s Attorney General said it would seize 95 million Swiss francs ($96 million) from BSI and start enforcement procedures against two of its former employees. BSI said Tuesday it has co-operated fully with the investigations.
In the statement Wednesday, the Swiss bank said the unit was not affected by the financial penalties levied by the regulators because they will be paid using BSI’s General Reserves for Banking Risks. It also said that the Singapore regulator had stated that the bank was solvent and had assets in excess of its liabilities and commitments.
To contact the reporters on this story: Chanyaporn Chanjaroen in Singapore at firstname.lastname@example.org, Klaus Wille in Singapore at email@example.com. To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at firstname.lastname@example.org, James Poole, Andrew Blackman
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