Correspondent & intermediary banking
Structure the account, payment and settlement responsibilities that connect one institution with another.
Define the role before the route
A correspondent relationship establishes agreed services between financial institutions. Depending on the mandate, that may include an account arrangement, payment processing, liquidity provision or support for specified cross-border activity. An intermediary role concerns the institution’s position in a particular payment chain. The two concepts should be documented distinctly.
Institutions seeking to appoint KLASS BANK as a correspondent or intermediary should describe the currencies, jurisdictions, payment types and operating role required. The discussion must confirm which services can be supported and under what conditions before routing instructions are issued.
Account, payment and settlement design
Bilateral accounts: specify the legal account holder, account purpose, supported currency, funding model, authorised users, reporting and reconciliation responsibilities. Nostro and vostro describe the respective institutions’ perspectives on a correspondent account.
Intermediary processing: identify the originating and receiving institutions, intended payment chain, required identifiers and allocation of charges. Agree how incomplete instructions, returns, investigations and recalls will be handled.
Settlement and liquidity: set out the settlement asset and account, cut-offs, value dating, prefunding or agreed credit arrangements, exposure controls and treatment of shortfalls.
The operating agreement
Cover instruction authentication, permitted channels, message completeness, reconciliation, escalation contacts and business continuity. Any nested or downstream institutional activity must be expressly identified and assessed; it should not be assumed to fall within a direct relationship.
Commercial and risk terms must address pricing, limits, information requests, suspension, termination and outstanding items. Approved standing settlement instructions should be independently verified through established contacts before funds are sent or details changed.
Submit a precise mandate
Explain whether you seek an account relationship, an intermediary role, a messaging arrangement or a combination. Include a non-confidential description of the corridor, currency and service requirement. An online enquiry does not itself activate routing or settlement.
Bring your priorities to the table.
Tell us who you represent, the relationship you want to establish and the markets or capital objectives in scope.