24 July 2019
The EBA published today an Opinion on the link between money laundering and terrorist financing concerns and prudential objectives. This Opinion forms part of the EBA's ongoing work to strengthen the fight against money laundering and terrorist financing in Europe and responds to a request in the Council Anti Money Laundering Action Plan of 2018.
With this Opinion, the EBA invites prudential supervisors to send a common message to institutions that prudential supervisors factor AML/CFT issues into the prudential supervisory process and cooperate closely with AML/CFT supervisors for this purpose.
Money laundering and terrorist financing (ML/TF) can have a significant, adverse impact on an institution's safety and soundness. This is why prudential supervisors need to be aware of, and act upon, ML/TF risks, which may pose prudential risks to the institutions they supervise and in particular:
- When considering whether to authorise an institution or when assessing proposed acquisitions of qualifying holdings;
- As part of their ongoing supervision of institutions, for example when assessing the adequacy of an institution's governance and risk management systems; and
- When taking corrective measures to address potential weaknesses from a prudential perspective.
The EU Council made clear in its action plan of 2018 that the link between ML/TF risk and prudential objectives means that prudential and AML/CFT supervisors must cooperate closely and share information in the discharge of their respective functions. Where institutions operate across borders, the EBA expects supervisors to cooperate with their international counterparts.
Opinion on Communication of ML TF risks to supervised entities
Supervisory Review and Evaluation Process (SREP) and Pillar 2
Anti-Money Laundering and Countering the Financing of Terrorism