BANK OF ALBANIA
Explanation regarding statements related to the American Bank of Investments
Publication date: 07.02.2019
Following a series of statements addressing the Bank of Albania, in the framework of transparency related to our decision-making, with a view to explaining better to the benefit of public interest, the Bank of Albania deems it is impelled to provide a comprehensive explanation regarding statements related to the American Bank of Investments.
Transfer of qualifying holding
The Bank of Albania, upon the Supervisory Council's Decision No 73, dated 7 October 2015, approved the transfer of 100 per cent of the qualifying holding in the equity of Credit Agricole Albania from IUB Holding, France to Tranzit sh.p.k., a non-bank financial institution registered at the National Business Centre, in 2009, and granted licence no 20, dated 04.08.2010 by the Bank of Albania, to carry out the financial activity of crediting.
Following this decision, in December 2015, the change in the name was also approved from Credit Agricole Albania to American Bank of Investments.
Legal grounds sustaining the decision-making at the Bank of Albania
The preliminary approval for the transfer of 100 per cent of ownership over the shares in the equity of Credit Agricole Albania from “IUB Holding” SA, France (seller) to “Tranzit” sh.p.k. (acquirer) was scrutinised, evaluated and approved pursuant to and in accordance with the applicable legal provisions and bylaws in force , as follows:
- Article 4, paragraph 8 and Article 24, paragraph 1, letter “gj” of Law No. 9662, dated 18.12.2006 “On banks in the Republic of Albania”, as amended;
- Article 25 of the Law on banks, upon the evaluation of all legal conditions related to the change of qualifying holding of a bank or branch of a foreign bank;
- Regulation No 14, dated 11.03.2009 “On licencing and exercising of the activity of banks and branches of foreign banks in the Republic of Albania”, Article17, on the completion of the required conditions and documents to be submitted to the Bank of Albania.
The Bank of Albania, conform to the legal and regulatory requirements, has scrutinised the integrity and reputation of the new shareholders and of the indirect shareholders of the Bank, based on the following documents:
- Proof of payment by tax authorities related to Tranzit sh.p.k. tax obligations;
- Attestation from the registrar of companies in the Cayman Islands, for the two indirect shareholders New Century Holdings XI, L.P. and NCH Balkan Fund, L.P., certifying that the two companies are exempted from taxes;
- Attestation from the registrar of companies in the Cayman Islands, for the two indirect shareholders New Century Holdings XI, L.P. and NCH Balkan Fund, L.P., certifying that the two companies are in good shape and continue their activity;
- Attestation from the Albanian Financial Intelligence Unit for Tranzit sh.p.k. and NCH Capital, according to which there is no information of interest to their reputation;
- Statements by the shareholders, up to the final beneficiaries (Mr George Rohr and Moris Tabacinic) related to payment of tax obligations, not being subject to criminal proceeding, not being convicted of any criminal offence, having no third-party liabilities, etc.;
- The document by the US Embassy in Albania certifying that NCH Capital Inc. is a company listed in the U.S. Securities and Exchange Commission (SEC), and as such is subject to supervision and regulation by this authority.
Information on the shareholders of the companies is made public and may be/are easily generated by public registers; however, we would like to clarify that:
The direct and sole shareholder, holding 100 per cent of the shares in the American Bank of Investments is Tranzit sh.p.k., registered at the National Business Centre, in Albania, in 2009.
Tranzit sh.p.k. is controlled by NCH Balkan Fund L.P. and New Century Holdings XI, L.P. These funds are financed by investors such as renowned universities, state pension funds and other corporates and institutions from the US, the UK and Western Europe. Both funds are managed by NCH Capital Inc., an investment consulting company registered in SEC, USA, with a long experience in the financial sector. For more than 20 years it has been present in the banking sector in Central and South-East Europe through bank capital in Romania, Latvia and Moldova.
At the same time, we would like to clarify that the legal and regulatory framework on banks in the Republic of Albania does not set out any prohibitions or restrictions related to the country of registration or exercise of activity of indirect shareholders of the entities, which exercise banking activity in the Republic of Albania.
Regardless of the above, the Bank of Albania, in accordance with the legal provisions, and international standards (including FATF standards) in the case of off-shore registered companies has carried out its evaluations and has identified the shareholders up to the final beneficiaries. The evaluation of the integrity or the reputation of direct and indirect shareholders in the bank is based on a series of documents such as: proof of payment by tax authorities related to the payment of tax obligations; correspondence with the Albanian Financial Intelligence Unit , or statements by shareholders up to the final beneficiary, related to issues such as payment of tax obligations, not being subject to criminal proceeding, not being convicted of any criminal offence, having no third-party liabilities, etc.;
Legal provisions in the US applicable in the Albanian banking sector
We would also like to inform the public that on 18 March 2010, the US approved certain legal provisions known as the Foreign Account Tax Compliance Act, which requires that foreign financial institutions (FFIs) report on certain accounts. The Foreign Account Tax Compliance Act (FATCA), approved in 2010 as part of the Hiring Incentives to Restore Employment (HIRE) Act, is an important development in U.S. efforts to combat tax evasion by U.S. persons having investments abroad. Under FATCA, certain U.S. taxpayers holding financial assets outside the United States must report those assets to the IRS. FATCA will also require certain FFIs to report directly to the IRS information about financial accounts held by U.S. taxpayers or by foreign entities in which U.S. taxpayers hold a substantial ownership interest.
The Albanian banking system, since July 2014, has been conducting its activities in accordance with FATCA requirements and regulation. Each bank reports to the IRS all the accounts, investments and transfers made by US citizens, US residents who use an address or have granted a power of attorney for bank accounts or transfers to a US citizen or resident.
On measures related to the prevention of money laundering and terrorism financing
Lastly, we would like to emphasise that the Bank of Albania has devoted its utmost attention to maintaining the integrity of the financial system and conducting due supervision on the adequacy and effectiveness of preventing measures in the context of AML/CFT for all entities subject to the law. This approach has been realised through on-site inspections, cooperation with the Albanian Financial Intelligence Unit, business meetings, joint training, etc. On-site inspections have shown that the level of compliance with obligations arising from legal and sublegal acts is overall satisfactory and risk from money laundering/financing of terrorism have been managed with effectiveness. In concrete terms, banks have: designed and implemented appropriate policies and procedures; set up adequate structures; put in place centralised systems and ensured their functioning; set up internal control systems; prepared and implemented training programmes; complied with legal obligations on reporting; improved the quality of suspicious activity reports and the analysis of complex and unusual transactions that has been conducted or attempted, etc.
Evaluation by the MONEYVAL Committee
In the evaluation process (round five) by the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL) of the Council of Europe on issues related to prevention of money laundering, combating the financing of terrorism, legal compliance, effectiveness, etc., the measures undertaken by banks in the AML/CFT framework were assessed as positive by the experts. In concrete terms, as stated in the MONEYVAL report, the effectiveness and compliance for financial entities, especially banks was rated as “Substantial” on matters related to AML/CFT. This is the highest rating compared to the ones obtained by other institutions involved in this evaluation according to the new assessment methodology by FATF.
The same regulatory and supervisory framework has been applied also for the American Bank of Investments, as a member of the Albanian banking sector. The Bank of Albania has been present regularly in ABI Bank through its inspections in the framework of AML/CFT. Also, in the framework of on-going supervision, the American Bank of Investments, like the rest of the banking system, has been subject to off-site supervision, on the basis of qualitative and quantitative reports that are conducted once a year. According to data from the 2017 reporting year, the American Bank of Investments has received an integrated rating in accordance with the average rating of the banking system.
In conclusion to this statement, the Bank of Albania would like to assure the public that the integrity and reputation of the financial activity of the banking system in Albania remains a valuable achievement, in which politics has had a very positive role over the years. The banking system has been appraised continuously not only by legislative institutions in Albania, but also by reputable international institutions, as an actor that has a significant role and indisputable contribution to the economic and social development of the country.
The Bank of Albania is open to provide any information that contributes to transparency and will continue to be dedicated to complying with constitutional obligations and institutional duties and commitments. The Bank of Albania will be always guided by integrity, professionalism and transparency, while the focus of our work will be always on the development of the banking system, as well as on safeguarding and strengthening financial stability in Albania, in line with the best international practices and standards.
 Financial Action Task Force.