The leading bank in Papua New Guinea (PNG), the Bank of South Pacific (BSP) announces today a material impact of the new exchange rate trading band introduced by Bank of Papua New New Guinea last week due to a reported market failure.
“BSP wishes to advise the market of a potentially material impact on 2014 earnings, consequent to instructions issued by the Bank of Papua New Guinea to Authorised Foreign Exchange Dealers to limit margins on foreign exchange transactions to a maximum of 75 basis points either side of the Bank of PNG reference rate.
“The new measures introduced by Bank of PNG became effective on 4 June 2014. The full earnings impact is yet to be determined as the market is still adjusting to the new regime.
“A more accurate estimate of the impact will be made once the 2014 Half Year Results are subject to interim audit review procedures, and published in August 2014” BSP states.