Selecting your offshore banking partner
It is important that your offshore banking partner is selected based on your own requirements. Important considerations include:
Location: the location of your offshore bank is obviously important. For example, if you have incorporated an offshore structure into a certain jurisdiction, it make more sense to establish a bank account in that jurisdiction as well. Other factors include: proximity to attractive investments, proximity to business activities, consideration of the political and economic stability of the jurisdiction where the bank is situated and consideration of the credit rating of the bank of choice.
Services Offered: Offshore banks on aggregate can provide exactly the same services as their onshore counterparts. However, when selecting an individual bank it is important to check that particular bank satisfies all your current and future requirements. Also, as the offshore banking space is very competitive some banks provide extremely competitive interest rates on deposits - a bit of research will locate these banks. Common services include:
- Deposit taking
- Credit
- Wire and electronic funds transfer
- Foreign exchange
- Letters of credit and trade finance
- Investments managemen
- Fund management
Procedures and Compliance: Generally, offshore banks have strict procedures to protect your confidentiality; however, some are stricter than others. Much is dependent on the legal framework of the jurisdiction. For example, Switzerland has strict bank secrecy laws. Most offshore bank can report to the tax authorities but they do not have the legal obligation to do so. Also it is very important to undertake due diligence into the history of the offshore bank if it is less well known.
For help with selecting you banking partners, please contact one of our specialists. We have well established relationships with many grade A offshore banks across the globe.