Compliance

CJSC Commercial Bank "KSB" informs that it carries out its activities in full compliance with the legislation of the Kyrgyz Republic in the field of CFT/AML, as well as with international standards and recommendations.

Bank's CFT/AML System

1. Responsible unit
The bank has a dedicated financial disclosure and compliance unit responsible for policy implementation, internal monitoring, compliance control, and interaction with government agencies. A dedicated compliance officer has been appointed.

2. Internal documents
A set of internal regulations (policy, internal control program, identification procedures, risk management, suspicious transaction detection, and training) is in place. These documents are regularly updated.

3. Technological solutions
The Bank uses specialized IT systems to automatically identify suspicious transactions subject to control and risk monitoring of clients and maintain the necessary databases.

4. Risk-oriented approach
We assess the risks of clients and transactions, classify clients by risk level and enhance control over high-risk categories.

5. Personnel training
Employees undergo mandatory annual training, and new employees undergo initial training in CFT/AML.

6. Interaction with government agencies
The Bank promptly transfers information on transactions subject to mandatory control or raising suspicions to the authorized bodies of the Kyrgyz Republic.

Policy on CFT

Our Bank complies with the requirements of international and regional standards for the protection of financial instruments and the financing of terrorism, including the recommendations of the FATF and EAG.
·    FATF (Financial Action Task Force) is an international group that develops financial measures to combat money laundering and terrorist financing, setting standards for financial institutions.
·    EAG (Eurasian Group on Combating Money Laundering and Financing of Terrorism) is a regional organization for the CIS and Central Asian countries, adapting FATF recommendations to regional specifics and monitoring their implementation.

The Bank meets key requirements of these organizations, including:
·    A risk-based approach to clients and transactions, with particular attention to politically exposed persons and high-risk categories;
·    Identification and verification of ultimate beneficiaries and politically exposed persons;
·    Monitoring and analyzing transactions to identify suspicious transactions and promptly report them to regulators;
·    Ensuring payment transparency and compliance with sanctions;
·    Regular training of employees and maintaining an effective internal control system.

Commercial Bank "KSB" CJSC operates in full compliance with international standards of the Financial Conduct Authority (FCA)/LPA, including the Bank Secrecy Act (BSA) and the principles of the Wolfsberg Group.
The Bank applies these standards to:
·    Conducting customer and transaction checks (Customer Due Diligence, CDD);
·    Identification of ultimate beneficial owners and politically exposed persons (KYC/PEP);
·    Transaction monitoring and reporting of suspicious transactions;
·    Risk management for high-risk clients and transactions;
·    Using the international Wolfsberg questionnaire for risk assessment.

The application of these standards allows:
·    Minimize the risks of CFT/AML;
·    Comply with international compliance requirements;
·    To increase the trust of international partners and correspondent banks.

AML_Questionnaire_Wolfsberg

FATCA
"KSB Commercial Bank" CJSC complies with the requirements of the US Foreign Account Tax Compliance Act (FATCA).
The Bank implements all necessary procedures for:
·    Identification of US tax residents among its clients;
·    Collection and processing of information on accounts held by US citizens or residents in accordance with FATCA requirements;
·    Submitting information to the IRS through an established reporting system;
·    Ensuring compliance with all FATCA-related rules and agreements within the framework of international cooperation.

FATCA status Bank:
Participating FFI (Foreign Financial Institution)
GIIN number:
QWHG36.99999.SL.417

Form W-8BEN-E is a document confirming the beneficial owner status and FATCA status.
W-8BEN-E Скрыть

The Bank has implemented a system LexisNexis, which provides expanded automated compliance control capabilities. In addition, automated screening against the Consolidated Sanctions List of the Kyrgyz Republic has been implemented, allowing for the prompt identification of matches with national sanctions lists.

The LexisNexis database and software into the bank's core banking system is fully implemented and operates automatically, providing:

• Fully automated sanctions screening of clients and transactions.
The system automatically and daily monitors new and existing clients, as well as all transactions, for compliance with official sanctions lists:
– UN Security Council;
– OFAC;
– European External Action Service (EU);
– UK Treasury (HMT);
– Foreign Politically Exposed Persons (PEPs), National Politically Exposed Persons (NEPs);
and the expanded LexisNexis databases. List updating and screening are performed without employee intervention, including outside working hours.

• Automatic detection of sanctioned payments and transactions related to risky territories.
The system detects transactions to or from sanctioned persons, as well as transactions related to sanctioned regions, foreign banks and their branches, offshore jurisdictions, and other high-risk areas.

• Monitoring international transactions for sanctioned goods.
The system analyzes product descriptions in payment documents and automatically determines whether the specified goods comply with sanctions lists and dual-use goods lists.

• Minimize false matches.
LexisNexis's specialized matching algorithms ensure high analysis accuracy, significantly reducing the number of false positives.

• Reporting and monitoring quality control.
LexisNexis tools allows to generate complete and detailed reports, track the dynamics of false matches, control the effectiveness of monitoring, and the quality of results processing.

• Identification of related parties using the “50%+” rule.
Thanks to the additional capabilities of LexisNexis, the system automatically identifies subsidiaries and affiliates of sanctioned entities, even if they are not on the official lists of OFAC, EU, HMT, and other regulators.

Sanction Policy of KSB Commercial Bank Скрыть

Our Bank implements a compliance program aimed at developing an effective system for ongoing monitoring of compliance with regulatory requirements and internal regulations established by the Compliance Department.

Objectives of the program:
•          ensuring compliance with legal requirements and internal regulations;
•          identification and minimization of risks of non-compliance with legal norms, regulatory requirements and internal rules;
•          development of unified approaches to compliance risk management.

Main elements of the program:

1.         Identification of compliance risks
•          analysis of business processes and operations;
•          identification of risk sources and factors;
•          recording risks in the compliance risk register.

2.         Compliance risk assessment
•          assessment of the probability of risk occurrence and the level of its impact;
•          definition of risk categories (low, medium, high);
•          recommending management measures.

3.         Compliance risk management
•          development of corrective measures;
•          implementation of procedures for the prevention, reduction and monitoring of risks;
•          analysis of the effectiveness of current measures.

4.         Monitoring compliance risks
•          continuous monitoring of risk dynamics;
•          revision of risk assessment in the event of changes in activities or legislation;
•          preparation of reports for management.

5.         Updating the program
•          annual review of the methodology;
•          updating methodologies and processes in accordance with changes in regulatory requirements and the development of the functions of the Compliance department.
  Скрыть