Fidelity bank, FNB fined, suspended from forex trade over breaches

The Bank of Ghana (BoG) has fined and imposed one-month suspension of the foreign exchange (forex) licenses of Fidelity Bank and First National Bank (FNB) for breaching forex regulations in the country. 

Per a public notice issued today, the two banks breached the Indicative Quotes, Trade Reporting on Platforms and Fixing of the Official Exchange Rate rules of forex trade.

The license suspension of the two banks takes effect from Thursday, June 29 to July 28, 2023.

Fidelity Bank and FNB have been fined 1000 penalty units. One penalty unit is GH₵‎12 translating into GH₵‎12,000.

The combined fine imposed on Fidelity Bank and FNB s GH₵‎24,000.

BoG cautioned forex market players including banks, forex bureaus, forex brokers, and money transfer operators (MTOs) to adhere strictly to the applicable forex market regulations and guidelines.

The three rules the two banks breached are;

3.4 Indicative Quotes
Licensed Foreign Exchange Dealers (LFXDs) are required 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).

3.5 Trade Reporting on Platforms
All interbank Foreign Exchange (FX) trades must be booked on the Reuters platform and appropriately confirmed within five (5) minutes after the trade is concluded.

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

3.9 Fixing of the Official Exchange Rate
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 spread around the weighted average exchange rate.