Forex licences of Fidelity Bank, First National Bank temporarily suspended

The forex licenses of Fidelity Bank Ghana Limited and First National Bank Ghana Limited have been suspended temporarily.

This is because, the two financial institutions have breached some sections of the Ghana Interbank Forex Market Conduct rules, according to the Bank of Ghana (BoG).

The Central Bank which meted out the sanction has also fined the two banks, a combined 1000 penalty points each.

The suspension of the banks from forex trading is for 30 days and takes effect from today, June 29 to July28, 2023.

“Bank of Ghana has fined Fidelity Bank Ghana Limited and Fiorst National Bank Ghana a combined 1000 penalty points each for breaching 3. 4, 3.5 and 3.9 of the Ghana Interbank Forex Conduct rules”, the BoG said in a notice.

Forex market players including banks, forex bureaus, forex brokers and money transfer operators have thus been cautioned to adhere strictly to the applicable market regulations and guidelines.

Specific breaches

Section 3.4 of Ghana Interbank Forex Market Conduct rules deals with indicative quotes which require the banks to update indicative quotes for buying and selling US dollars at regular intervals, on the Reuters and Bloomberg information systems.

Indicative quotes shall be updated at intervals of no more than 30 minutes. (This will show the price at which a market-maker is prepared to buy and sell at the minimum traded lots).

For section 3.5, it is on trade reporting platforms.

Specifically, all interbank FX trades must be booked on Reuters platform and appropriately confirmed with five minutes after trade is concluded.

These trades must also be reported in the daily FX report submitted to the Bank of Ghana.

The two banks also failed to adhere to section 3.9 on the fixing of the official exchange rate.

It states that, “the Bank of Ghana shall publish the Ghana Cedi reference rate with respect to the US dollar on
the Bank of Ghana website by 16:30 hours GMT daily except on holidays. The reference rate shall be computed using the weighted average exchange rate of all eligible US dollar transactions that are reported to the Bank of Ghana by the cut-off time of 15:30 hours GMT. The Bid and Offer reference rates are calculated by taking a +/- 0.05% bid/ask to spread around the weighted average exchange rate. The reference rate will also be published on Reuters and Bloomberg by 16.30 hours GMT.”

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