On 24 July 2019, the European Banking Authority (EBA) published an opinion on the link between money laundering and terrorist financing (ML / TF) concerns and prudential objectives. The opinion is addressed to prudential supervisors of Member State competent authorities.
In the opinion the EBA invites prudential supervisors to communicate to institutions’ management bodies and senior management the expectation that Member State prudential supervisors are aware of, and act upon ML / TF risks that may have an impact on an institution’s safety and soundness. The EBA also invites such supervisors to alert institutions to the fact that concerns about ML / TF, in particular concerns stemming from anti-money laundering / counter terrorist financing (AML / CFT) authorities’ assessments of ML / TF risks associated with individual institutions, will also be considered in the prudential supervisory process.
The EBA also invites Member State prudential supervisors to draw institutions’ attention to the extent to which ML / TF concerns may have an impact on prudential objectives and highlight that they will endeavour to mutually exchange information and cooperate with AML / CFT authorities concerning individual institutions (including their branches) and group entities both domestically and across borders.
The EBA also reminds institutions that they are responsible for ensuring that their governance and risk management are adequate to enable them to identify, assess and manage the risks to which they are (or may be) exposed, including ML / TF risks.