IMF warns of erosion of correspondent banking networks

Tokyo

THE worldwide network of correspondent banking relationships among globally-operating banks and local institutions is shrinking and the contraction threatens to reach a point that seriously erodes the function of the international payments system, the International Monetary Fund (IMF) has warned.

"Pressure on correspondent banking relationships (CBRs) could disrupt financial services and cross-border flows, including trade finance and remittances, potentially undermining financial stability, inclusion, growth and development goals," the IMF said in a report issued on Thursday in Washington.