Banking group, Central African Building Society (CABS) has tied up with a Spanish bank to cater for inward and outward foreign currency transactions in a development that strengthens its global banking correspondence networks.

CABS Bank is a subsidiary of Old Mutual Zimbabwe.

The development comes as most Zimbabwean financial institutions have been struggling to hold on to their foreign correspondent banking partners due to the economic sanctions placed upon the country.

The US sanctions on Zimbabwe are guided by the Office of foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy, and the Zimbabwe Democracy and Economic Recovery Act (ZIDERA), an act passed by the United States Congress which imposed economic sanctions on the country.

Said CABS managing director Simon Hammond in a statement:

“We are pleased to advise that CABS has secured additional Nostro accounts in United States Dollars (USD) and Euro (EUR) with BMCE Bank International, Spain,” he said.

“However, the USD account is restricted to incoming transfers only, while the EUR account is for both inward and outward transactions.”

“CABS will continue supporting outward and inward international payments in EUR, South African Rand (ZAR) and Botswana Pula (BWP). While efforts are underway to secure an option for USD and GBP outward payments, we encourage you to consider the above-stated currencies in place of the USD and GBP denominated payments.”

Official figures indicate that Zimbabwe has lost over 100 foreign correspondent banks since 2008.

A correspondent bank is essentially a bank in one country that is authorised to provide services for another bank or another financial institution located in a foreign country, with typical services including currency exchange, handling business transactions and trade documentation, and money transfers.