CONFIDENTIAL
!
HKCB 020126
מן
RECEIVER IN STO
121
122374 MDLOAN 4820
CONFIDENTIAL
FM FCO
TO PRIORITY RIYADH
TELNO 508
OF 24140OZ AUGUST 90
12 SEP 1990
W
INFO ROUTINE AMMAN, UKDEL IMF/IBRD WASHINGTON
า
YOUR TELNO 698: SAUDI BANKING
1.
WE HAVE DISCUSSED TUR WITH THE BANK. THEY TELL US THAT THEY HAVE HAD SEVERAL CONVERSATIONS WITH SAMA SINCE THE IRAQI INVASION OF KUWAIT INCLUDING ONE SINCE RECEIPT OF TUR. THE BANK ASKED SPECIFICALLY IF THERE WERE ANY PROBLEMS: NONE OF THE CONVERSATIONS HAVE GIVEN THE BANK CAUSE TO BELIEVE THAT SAMA HAS OR HAD ANY COMPLAINTS. WHEN TIM SMITH SPOKE TO DEPUTY GOVERNOR AL SUHAIMA ASKED HIM TO CONVEY HIS GOOD WISHES QUOTE TO ALL OUR FRIENDS IN THE BANK OF ENGLAND UNQUOTE. YOUR CONTACT AT SAUDI BRITISH SEEMS NOT TO REFLECT FEELING AT SENIOR LEVELS. THE BANK DOES NOT BELIEVE THERE HAS BEEN ANY DAMAGE TO ITS CUSTOMARILY
GOOD RELATIONS WITH SAMA.
2. AS FOR THE APPLICATION OF THE FREEZE ON KUWAITI ASSETS, THE BANK BELIEVES ITS REGULATIONS HAVE WORKED WELL. THE US TREASURY - WHICH HAS A WELL-STAFFED PERMANENT OFFICE FOR ASSET FREEZING WERE SLOWER TO SET OUT THE GENERAL PRINCIPLES OF THEIR FREEZE AND HAD TO BACK-TRACK IN A NUMBER OF AREAS WHERE THERE REGULATIONS HAVE CAUSED PROBLEMS, SUCH AS THE TREATMENT OF INDIVIDUAL INSTITUTIONS WITH KUWAITI PARTICIPATION AND THE UNWINDING OF PRE-ZERO TRANSACTIONS. THE BANK HAS PLAYED AN IMPORTANT ROLE IN TRYING TO DISENTANGLE THE INEVITABLE INTERNATIONAL COMPLEXITIES OF A FREEZE OF THIS KIND. IT IS PERHAPS INSTRUCTIVE THAT LEADING KUWAITI INSTITUTIONS, SUCH AS THE CENTRAL BANK, THE KIO AND THE KPC ARE SEEKING TO USE THE UK AS THE BASE FOR THEIR OPERATIONS. 3.
GIVEN THE WORK PRESSURES HERE WE REGRET THERE
IS LITTLE PROSPECT OF AN
EARLY VISIT BY A BANK OF ENGLAND OFFICIAL. TIM SMITH PLANS TO VISIT IN THE AUTUMN AND WILL LOOK AT WHETHER HE MIGHT BE ABLE TO
ADVANCE THOSE PLANS.
HURD
YYYY
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