Here is the article rewritten in markdown format with proper headings, subheadings, and bullet points:

Bahamas Central Bank Issues Guidance Notes for Terrorist Financing Risk Assessments

NASSAU, BAHAMAS - In a move aimed at strengthening anti-money laundering and combating the financing of terrorism (AML/CFT) measures in the country’s financial sector, the Central Bank of the Bahamas has issued guidance notes for the completion of Money Laundering, Terrorist Financing and Proliferation Financing risk assessments.

Guidance Notes Intended to Strengthen AML/CFT Measures

The guidance notes are intended to be used in conjunction with existing guidelines for supervised financial institutions on the prevention of money laundering, countering terrorism financing, and proliferation financing. The risk assessment process is a critical component of an institution’s AML/CFT compliance framework, requiring financial institutions to assess their inherent risks, control environment, and residual risks.

Key Elements of Risk Assessment Process

The key elements of the risk assessment process outlined in the guidance notes include:

• Risk Assessment Methodology: Institutions must establish a clear and documented approach for conducting risk assessments.
• Risk Appetite and Risk Tolerance: Financial institutions must clearly define their risk appetite and tolerance levels.
• Identification and Assessment of Inherent Risks: Institutions must identify and assess potential risks, including those related to money laundering, terrorist financing, and proliferation financing.
• Identification and Assessment of Controls: Institutions must evaluate the effectiveness of existing controls in mitigating identified risks.
• Corrective Action Plan(s) where applicable: Financial institutions must develop and implement corrective action plans to address gaps or weaknesses identified during the risk assessment process.
• Evaluation of Residual Risk: Institutions must assess and monitor residual risks to ensure they are within acceptable levels.

Regular Review and Update Required

The Central Bank expects financial institutions to regularly review and update their risk assessments on an ongoing basis, using a proportionate and risk-based approach to identify and address any gaps in their AML/CFT compliance frameworks.