•  بانک سپه
  • جستجو
Saturday11 July 2020    
Icon Anti-Money Laundering (AML) / Combating the Financing of Terrorism (CFT) Policy of Bank Sepah Anti-Money Laundering (AML) / Combating the Financing of Terrorism (CFT) Policy of Bank Sepah Icon Anti-Money Laundering (AML) / Combating the Financing of Terrorism (CFT) Policy of Bank Sepah
Print
In accordance with the Anti-Money Laundering Law (AML Law) , Executive By-Law of Anti- Money Laundering Act , and Combating the Financing of Terrorism (CFT) approved by Islamic Consultative Assembly of Iran , Bank Sepah is pleased to provide details and information as follows :
Due to Article 7 of AML Law : Individuals, institutions and agencies subject of the present Law (as mentioned in Articles 5 and 6), due to their type of activity and organizational structure, are required to fulfill the following points :
  • To verify their customers' identity and in case a representative or an agent delegates the principal, to verify the identity and the title of the agent, should there be any reasonable suspicion as to the commission of an offence ;
  • To provide information, reports, documents and evidences to the High Council within the scope of the implementing regulations which will be approved by the Board of Ministers ;
  • To report suspicious transactions to the authority appointed by the High Council;
  • To keep the records of the customers' identification documents as well as the records of the accounts and transactions within the time limit as determined in the implementing regulations ;
  • To establish internal control standards and to train the managers and personnel in order to comply with the provisions of the present law and the implementing regulations thereof.
All details of Anti-Money Laundering Law (AML Law) can be obtained from the website at:www.BankSepah.ir/English
Due to Article 19 of Executive By-Law of Anti- Money Laundering Act; Obligations of individuals or responsible units under Article 18 [as AML officers] are as follows :
  • To examine, scrutinize, prioritize and comment on the reports sent by the personnel of competent authorities.
  • To promptly send such reports in the specified formats to FIU without customer's knowledge
  • To monitor activities of those customers receiving the basic services in order to identify suspicious transactions.
  • To devise necessary mechanism in order to monitor and control anti-money laundering processes (processes of collecting and analyzing information, personnel recruitment, training and the like) and survey and evaluate its implementation level in the appropriate institution.
  • To provide supplementary information required by FIU and other competent authorities in combating terrorism.
  • To issue required directives as regards implementing the Act and relevant regulations upon approval by the Secretariat.
  • To inspect and monitor subordinate units so as to ensure full implementation of laws and regulations.
  • To prepare statistics as for measures carried out by the relevant unit on anti-money laundering and the outcomes thereof.
  • To keep the records and reports of correspondence of its affiliated institution regarding issues of money laundering and terrorist financing.
Further details of Executive By-Law of Anti- Money Laundering Act can be obtained from the website at:www.BankSepah.ir/English
Combating the Financing of Terrorism (CFT) Law, comprised of seventeen Articles and five Notes , was ratified in the open session of the Parliament of the I.R. of Iran on Tuesday, February 13, 2016 and approved by the Guardian Council on Thursday, March 13, 2016.
Internal Audit
Print
Summary of Audit Committee Charter
In accordance with establishment of “Corporate Governance” in Bank Sepah, based on regulations of Central Bank of Iran, and in order to implement the directives of Basel Banking Supervision Committee, internal audit committee charter was approved by the bank Board of Directors in January 2017 which came into force as of the said date.
Objectives
1.To help the performance of supervisory responsibility of the Board of Directors and its improvement to obtain a reasonable assurance of the below-mentioned items:
  • Effectiveness of steering system and internal controls processes.
  • Soundness of financial reporting.
  • Effectiveness of internal auditing.
  • Independency and Effectiveness of independent auditors.
  • Compliance of rules, regulations and requirements.
Authorities
2-The bank Board of Directors authorizes the audit committee within its responsibilities to carry out its activities within the scope of the audit committee.
Number of members and meetings
  • The audit committee consists of 5 members that are selected by the bank Board of Directors for a 2-year period.
  • The meetings are held at least once in a month.
  • The audit committee is responsible to present report regarding performance of internal audit unit as well as independent audit to the Board of Directors per fiscal year.
Responsibilities
The main responsibilities of audit committee in different fields are as follows:
a.Financial Reporting
4.The main responsibilities of audit committee regarding financial reporting are as follows:
  • Supervising important subjects in financial reporting, general judgments and estimations, major accounting procedures, manner of disclosure, selection and alteration of any item and disclosing transactions with related persons in (report) of the company financial statements.
  • Obtaining reasonable assurance regarding reliability and timeliness of the bank financial statement.
  • Submitting annual report regarding performance of internal audit unit and independent audit to the bank Board of Director
b. Internal Control
5.The main responsibilities of the audit committee regarding internal controls are as follows:
  • Monitoring effectiveness of internal control systems of the bank including controlling information technology and preserving their security.
  • Obtaining reasonable assurance regarding adequacy of internal auditors’ scope of inspection from the bank internal controls system.
  • Investigating evaluation of internal audit regarding internal controls and independent auditor comments regarding internal controls.
  • To follow-up executing suggestions and remove weak points of internal controls that are reported to the committee by the internal or independent auditors.
  • presenting internal controls report to the Board of Directors including evaluation and commenting regarding internal controls of affiliated companies.
c. Internal Audit
6.The important responsibilities of the audit committee regarding internal audit, is as follows:
  • Investigating charter and organizational structure of internal audit and feeling assurance of adequacy of the said structure and its independency in order to perform duties and responsibilities of internal audit.
  • Investigating and approving the annual program of internal audit and adequacy of its required resources.
  • Observing the effectiveness of internal audit.
  • Obtaining reasonable assurance regarding compliance of internal audit with pertinent national and international standards.
  • Submitting proposal to the Board of Directors regarding appointment, dismissal, and determination of salary, benefits and remuneration for the internal audit manager.
d. Independent Auditor
7.The important responsibilities of the audit committee regarding independent audit, is as follows:
  • Investigating capacity, experience and independency of auditor and acquiring reasonable assurance of the consistency of their capacity.
  • Submitting proposal regarding selection or alteration of independent auditor to general assembly or Board of Directors.
Compliance of rules, regulations and requirements
8.The main responsibilities of the audit committee regarding compliance of rules, regulations and requirements, and acquiring reasonable assurance respecting the below-mentioned items:
  • Compliance of rules, regulations and requirements in the bank.
  • Existence of strategic plan and following-up the optimal performance of the bank strategic plans to achieve the overall and operational objectives.
  • Existence of organizational ethical charter and adherence of the management and the staff to it.
  • To follow up received reports regarding non-compliance of rules, regulations and requirements including Board of Directors approvals.
Summary of Internal Audit Unit Activities
In accordance with establishment of “Corporate Governance” in Bank Sepah, based on regulations of Central Bank of Iran, and in order to implement the directive of Basel Banking Supervision Committee, internal audit committee charter was approved by the bank board of directors in January 2017 which came into force as of the said date.
Mission and Scope of Activities
1.Internal Audit, this section is designed to assure and give independent and unbiased advisory services to create added value and improve operations.
2.As per approval No.523 dated 24.08.2015 of the bank board of directors, the internal audit unit works under the supervision of the board of directors and is administered by the bank managing director.
3.The internal audit manager is proposed by the audit committee and is appointed by the bank managing director and reports to the bank board of directors, managing director and audit committee. Reports to the bank board of directors are sent by the audit committee.
4.Mission of the internal audit unit is to assure and give independent and unbiased advisory services to add value and improve the bank operations. Internal Audit helps the bank to create a regulated and methodological framework in a way that:
  • Risks are recognized and managed in a proper manner.
  • Important financial, administrative and operational information of the bank are duly prepared and presented in a reliable and unbiased manner.
  • The continuous improvement of the bank controlling processes is encouraged.
  • Acquisition of resources is economical, and effective and functional resources are used and maintained properly.
5.The activity scope of internal audit includes all activities and risks of the bank as well as its affiliated companies.
Regulations Framework
6.The bank internal audit unit adheres to the professional standards of internal auditors to carry out its assigned duties, The regulations that are the basis of internal auditors’ jobs are as follows:
  • International framework of professional procedures of internal auditors association.
  • Basel committee approvals related to internal audit of banks and the relationship between supervisors and auditors.
  • Circular No. 1172/Mb dated 22.09.2007 of Central Bank of Iran regarding effective system of internal audit in credit institutions.
  • Internal Audit unit performs its operations based on defined principles in the aforesaid regulations and other laws and regulations related to internal audit function (including local rules and regulations for the bank branches abroad and its group companies existing abroad).
Authorities
7.Board of Directors fully authorizes the internal audit unit within its responsibilities framework, the below-mentioned powers:
  • have access to audit committee.
  • the possibility to have access to all documents of the bank and its affiliated companies.
Reporting
8.The results of investigations and following-up to improve methods of internal controls system is reported to audit committee, managing director and board of directors.
9.Regular reporting is made to audit committee regarding modern effective subjects in order to perform internal audit properly.
Responsibilities
10.The main responsibilities of internal audit unit are as follows:
  • preparation of flexible annual internal audit program as per activities prioritized in accordance with risk, including any type of risk or controlling considerations proposed by the bank management and presenting it to the audit committee to be investigated (prior to the approval by the board of directors)
  • Preparation of internal audit instruction.
  • Executing cases referred to, by the bank managing director, board of directors and audit committee.
  • Sound communication and cooperation with independent auditors to perform their responsibilities.
  • To build culture through proper information dissemination to bank staff in respect of its internal audit and its value-adding nature.
Independency and impartiality
11.Internal audit should render a reliable service which is unbiased, independent, and based on International professional standards, prepared in accordance with professional code of conduct. To meet this end, internal auditors should possess appropriate organizational stand and to be capable of conducting their activities based on professional standards. Audit committee continuously evaluates the effect of these two factors on the independency of auditors. In case of any harm, they report the matter to the board of directors.
The Structure of Internal Audit Manual
1.The internal audit manual framework guides internal auditors in performing the related duties, which result in optimal manipulation of resources, creating coordination in performance of operations, preparation and presentation of the audit report. Moreover, the present manual led to integrity in the performance of audit process and preventing from making personal biased judgments, within different stages of audit process.
2.Manual consists of:
  • Methodology of executing internal audit mission based on internal auditing standards, COSO framework and optimal performance patterns.
  • Practical directives to execute ordinary auditing missions of all the bank processes including strategic, operational, back-office and information technology processes.
  • Describing performance of special missions’ process.
  • Enabling internal auditors to respond to necessary and special events.
3.This deed governs all operations of the internal audit department and is a practical guidance, appropriate to perform auditing operations, circles and organizational department.
4.All phase of internal audit including planning to final reporting and following-up performance of audit advices are in compliance with the principles proposed in this deed. In order to present an overall vision of internal audit procedure to all members of audit teams, this directive explains the objectives of execution for the target phase at the beginning of each of the four internal audit phases. At the same time, it displays an algorithm of the executive actions to carry out that phase and all information and incoming evidences and products which are to be issued as output.
Risk Management
Print
Risk Management
With regard to the guidelines of the Banking Supervision Committee (Basel Committee) on establishment of effective system of internal control over credit institutions, Risk Department of Bank Sepah was established in 2004.
The department aims at recognition, classification and analysis of varieties of the Bank's risk exposures, as per the universal standards, and at calculation and measurement of the expenses resulting from non-control of these risks to control and cover them. Risk Department has accomplished significant projects such as recognition and measurement of operational risks, preparation of optimum foreign currency portfolio using VAR model, recognition and measurement of liquidity risk, calculation of interest rate risk and its influence on the Bank profitability, calculation and recognition of investment risk in different industries such as automobile and cement through making use of knowledgeable advisors.
Other operations of Risk Department include submission of monthly reports regarding the Bank different risk position. These reports have been used by the Bank managers in different intervals and have been effective in the Bank broad decision-making.
In 2007, the above-mentioned department was integrated into the Research and Planning Department, under the new title of Research and Risk Control Department.
This department also performs the below-mentioned operations to further recognize and control the risks on hand:
  • Report on diagnosis and evaluation of the branches' operational risks in respect of robbery;
  • Report on diagnosis of check-forgery in branches and presenting techniques to prevent forgery;
  • Preparation and compilation of operational risk pamphlet for branches;
  • Compilation of report on using credit insurances to cover the risk resulting from claims;
  • Investigation and diagnosis of the branches' deviation from liquidity limit and presenting techniques to manage liquidity and control the risk resulting from it;
  • Compilation of Report on "Management of Risk through Derivatives and Securitization";
  • Report on anticipation of the Bank resources and consumptions and analysis of credit policy as at 20 March 2010;
  • Report on management of risk challenges of unstable markets (case study of the recent financial crisis);
  • Report on "Diagnosis of Credit Rating System and Presenting Solutions";
  • Preparation and compilation of management of liquidity risk pamphlet for branches
  • Feasibility study of the allocation of Bank Sepah resources in accordance with the regional potentials, with regard to the credit limits declared by the Central Bank of Iran, to distribute and decrease credit risk.
Strategic Planning
Print
Strategic Planning
Regarding the fact that decision-making and planning under competitive circumstances requires deep and thorough attitude toward internal and external environments of the organization and existing interactions; Bank Sepah, as the first Iranian bank, has adopted a comprehensive strategic plan aiming at the following:
  • Identification of the strategic position, status and indices of the Bank
  • Identification of external environment, opportunities and threats affecting the success of the Bank in competitive environment
  • Identification of internal environment and basic abilities of the Bank and its strengths and weaknesses
  • Goal setting and determining the ideal position of the Bank
  • Identification of strategic issues and goals, as well as substantial strategies of the Bank
  • Achievement of a strategic vision in thinking and action
  • Specification of criteria for appropriate projects to achieve the determined goals
  • Development of operational objectives, their evaluation criteria and finally provision of an evaluation and monitoring framework for strategies and operational programs in the Bank
IT Strategic Plan
In Bank Sepah, priority is given to IT strategic planning to achieve ICT (Information and Communication Technology) development and optimize processes in order to create required conditions for the establishment of an integrated banking system and improve the status of the Bank to a modern, superior and pioneer bank in providing modern banking services.
Objectives:
  • Analysis of recent developments in information and communication technology and identification of its strengths and weaknesses
  • Improvement of coordination in production, presentation and support of electronic products and services and expansion of services based on e-banking
  • Possibility to change the internal departments' duties and creation of structures appropriate to IT framework
  • Establishment of an integrated banking system
Operational Budgeting
Print
Operational Budgeting System
Operational budgeting system clearly links the long-term and strategic objectives of banks to the annual operational objectives of banks and to the achievement costs thereto; whereas, in traditional budgeting the relationship between allocation of resources and performance has not been explained. In other words, in operational budgeting system the budget is allocated to the results and consequences.
Bank Sepah has designed and deployed operational budgeting system to improve its performance in management system and to increase its effectiveness. Operational budgeting is a combination of "annual performance plan" and "annual budget" which reveals the relationship between "budgetary levels of plan" and "expected results" thereof. In operational budgeting framework various administrative sections are responsible according to specific standards called performance indices, and managers are more empowered to determine the ways to achieve goals. On the other hand, in such a framework it would be possible for the policymakers, managers and even citizens to cooperate under strategic plans, cost priorities and performance evaluation. Operational budgeting considers the relationship between costs and results and instead of focusing on "the results of costs", it focuses on "the costs of the results" which makes it an efficient instrument in cost management.