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Basel Committee Calls on Banks to Update Their Cover Payment Policies

Banks should provide more detailed information on parties involved in cover payment transactions once a new interbank messaging system is implemented in the fall, according to an international banking committee. The payments, which are made in currencies other than those of payers' and payees' countries, involve third-party banks that process the transactions in separate jurisdictions, often without complete details on the payments' originators and beneficiaries, the Switzerland-based Basel Committee on Banking Supervision said Tuesday. Current messaging between financial institutions doesn't allow intermediary banks to easily share more information on cover payments, though the Belgium-based Society for Worldwide Interbank Financial Telecommunications,...

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