Dutch lender ING Groep NV will no longer clear U.S. dollar transactions for Bank of Valletta Plc, effective Dec. 14, the Times of Malta reported, citing a statement from the Maltese lender.

Bank of Valletta Chairman Taddeo Scerri told the Times of Malta that the bank is stepping up efforts to identify alternative correspondent banks to reduce potential operational disturbance to its businesses and customers. The lender is also working internally to improve its anti-financial crime structures and risk profile, Scerri said.

The move comes as ING seeks to shut down activities in areas it considers too risky to operate, after agreeing to a €775 million settlement with Dutch authorities in September 2018 to resolve a probe into its controls against money laundering.

Media reports about ING withdrawing from its relationship with the Maltese bank have been circling around for several months, while a Bank of Valletta official told the newspaper in May that the lender was preparing for such a scenario.

In 2017, Bank of Valletta lost U.S. dollar services through Germany's Deutsche Bank AG, according to the report.

Scerri added that general derisking across the banking industry is impacting smaller countries, such as Malta, where business does not produce substantial revenue to justify operations, costs and the inherent risk.