Who needs an account in a foreign bank and why?
Every person who earns money sooner or later raises the question of their safety and savings. Based on the fact that the Ukrainian banking system is not stable and reliable, the best option to secure your assets is to open an account with a foreign bank.
In this situation, it is important to choose the right country with an economically strong and stable system, as well as take care of choosing a reliable foreign bank. There is a stereotype that only highly wealthy people open accounts abroad, and not every person can afford it. Many years of financial experience allows us to refute this myth, because, as for a businessman, for an investor, for a company, and for an individual, there are options for opening an account in a foreign bank.
In order to understand this far from simple issue, we have prepared for you basic information on how to choose the best foreign bank to open an account.
For your convenience, we have divided foreign banks by geography. Taking into account regional criteria, 4 groups of banks were obtained:
- European banks;
- Turkish and CIS banks;
- Asian and US banks;
- offshore banks and other jurisdictions.
When choosing a foreign bank, you should pay attention to the following parameters:
- The stability of the political and economic spheres of the state in which the bank is located
- The level of reliability and prestige of the bank, based on the ratings of Standard & Poor's, Moody's, Fitch, etc.
- Correspondence of the bank's profile with the specifics of the intended operations on the account
- The level of control of the banking system by the state
- List of services rendered by the bank
- The amount of the minimum deposit
- Cost of services
- Quality of remote service
- Possibility of obtaining a credit card
- Interest on current and deposit accounts
- Availability of investment programs
- Location of bank branches
- Account opening time
- The level of privacy
- Funds offered for account management (Internet banking, fax, voice confirmation by phone)
- Requirements for the client, the procedure for checking his business
- Purpose of opening an account
- The presence of Russian-speaking staff
Conventionally, European banks can be divided into 2 groups: operational and savings.
For wealthy citizens who pursue savings or investment purposes, the banks of Austria, Liechtenstein, Luxembourg and Switzerland are most suitable. To open an account in these European countries, you need to invest in banking products, while confirming your solvency. The amounts of such investments can vary from 10,000 euros to 1,000,000 euros. It is also important to note that the number of transactions on savings and investment accounts is quite limited, mostly no more than 2 per month, and such accounts cannot be used for operational activities.
In turn, the banks of the Baltic States (Latvia, Estonia, Lithuania), Cyprus, Macedonia, Poland, Montenegro, the Czech Republic are more suitable for operating activities.
To use the services of reliable and prestigious banks in Europe, you will have to meet a number of requirements.
European banks strictly follow the “know your customer” principle and may require your personal visit for identification and acquaintance. At the same time, some banks work through agents, professional consulting companies that identify customers.
The personal information provided by the potential client is very carefully checked - the procedure is called due diligence (due diligence).
Due diligence is an absolutely legal and reasonable procedure that businessmen should not be afraid of. Its purpose is to protect the reputation of the bank, for which it specifies the sources of origin of the client's funds, his partners and the schemes by which the client plans to work. The purpose of the "know your customer" principle is to maintain the positive reputation of the bank. Getting to know a potential client, his managers want to make sure of his good reputation so that cooperation with him does not cast a shadow on their financial institution. At the same time, you may be asked for any information or documents confirming the legitimacy of your business and the purity of the origin of capital.
The disadvantage of European bank accounts is the limitation of the amount that can be withdrawn in cash (10 thousand euros). To avoid "freezing" your account, it is better to warn the bank in advance about withdrawing a large amount of cash. In this case, you will have to explain the motives for such a large transaction.
European banks use effective methods to track the movement of funds of companies and individuals, including: the Anti-Money Loundering Policy, the European Terrorist List, etc. This means strict control of the origin of funds, transaction analysis client, reliability of recipients and senders. The analysis is based on black, gray and white lists of countries around the world, with a thorough study of partner companies and banks for illegal activities and money laundering. Also, more and more often banks require confirmation of activities in the country of opening an account and the presence of an office in the country of registration of the company for which it is planned to open a bank account in Europe.
Account in the Czech Republic
Account in Cyprus
Account in Switzerland
Account in Austria
Account in England
Account in Latvia
Account in Estonia
Banks of Turkey and the CIS
Turkish banks are distinguished by loyalty to their customers, while accounts are opened preferably for European and reporting companies. Recently, Turkish banks have gradually begun to tighten the requirements for non-resident companies. In particular, the presence of a local office or branch and activities in Turkey are increasingly being requested.
The procedure for verifying a business and opening an account is relatively loyal - only a standard package of documents with translation into Turkish is required, while tariff rates are offered at reasonable rates.
To open an account in a Turkish bank, it is imperative to obtain a potential tax number, without which opening is impossible. A personal visit to the bank office is also required to sign bank forms.
Account management is carried out using Internet banking. When transferring via the Internet Bank, there is a limit of 200 000 TL for 1 transaction. With active work through the Internet bank, these limits increase over time to 1 000 000 TL per 1 operation.
When sending a payment order by e-mail with accompanying documents, there are no limits on payments.
Among CIS banks, Georgian banks attract attention. Most of the shares of the banks of this state are owned by foreign investors, which means that their stable condition, for the most part, depends not on the internal situation in the country, but on external economic factors that affect foreign investors.
However, in Georgian banks, communication with Georgia is increasingly required (partners in Georgia, office, work in Georgia). Consideration of documents by the bank can be delayed for a long time, which entails a number of inconveniences associated with waiting. Checking the activities of companies is scrupulous.
The same situation is with the banks of Kazakhstan, without a connection with the country of opening an account, banks often refuse to open.
The banks of Belarus are more loyal. To open an account, often only a standard package of documents with translation into Russian and detailed information on the planned activity are required.
Opening an account in these countries also requires a personal visit, but the process itself, at the moment, is much simpler than in European banks, while tariff rates are offered at reasonable rates. The main thing is to fulfill the basic requirements: having a connection with the country (Georgia, Kazakhstan), translation of documents, detailed information on the client's activities, a personal visit to the bank at the time of opening an account.
Account in Georgia
Banks of Asia and the USA
Asian banks are quite prestigious and respectable in terms of saving money and doing international business. The most popular of them are located in politically and economically stable states. The cost of opening an account is acceptable, and the amount of the minimum deposit can vary significantly from bank to bank.
Bank secrecy is observed at a very high level. Disclosure of information is possible only by a court decision when the client conducts illegal activities. This means: trade in weapons, drugs, prostitution, money laundering, etc.
Due to global changes in the global banking system, recently it has become quite problematic to open an account in Asian banks for a non-resident company. For example, the same Asian bank HSBC Hong Kong opens accounts only for resident companies with resident directors, a full-fledged office and activities in the country, and only with the personal presence of the client. But, there are exceptions. In turn, Bank Julius Baer & Co. Ltd. (Hong Kong) is considering opening an account for companies registered anywhere in the world, including in offshore jurisdictions.
In recent years, a popular trend is to open an account in the United Arab Emirates (UAE). At the moment, banks in this jurisdiction often open accounts for resident companies. In this case, it is necessary to personally visit the bank's office in the UAE, and it may also be necessary to fulfill such conditions as a mandatory deposit, a minimum balance, or investing in bank products. First of all, Emirati banks are focused on wealthy clients who already have an existing business in their place of residence (citizenship) and the client can confirm the sources of their income.
US banks are one of the most stable groups in the global banking system, it is no secret that it is America that determines the economic policy of most countries around the world, concentrating in itself the largest banking conglomerate.
The largest and most famous commercial banks in the US are Bank of America, Citigroup and JP Morgan Chase.
Due to its stability and respectability, the requirements of American banks for their customers are quite high, so the procedure for checking a business is very scrupulous. US banks are distinguished by a high level of confidentiality, however, accounts in them are opened exclusively for a resident company operating in the United States, with a personal presence at the representative office of the account manager's bank. At the same time, the account manager and shareholders of the company must have a residence address in the United States.
Offshore banks and other jurisdictions
Opening an account with an offshore bank is much easier than with any European or Asian bank.
Many offshore banks open an account remotely and are completely unpretentious towards the client. The procedure for checking a business is relatively loyal - only a standard package of documents is required, while tariff rates are offered acceptable.
Depending on the banks, a minimum account deposit may be required. The amount of the deposit is different, starting from 1000 EUR.
Recently, offshore banks have been strengthening the procedure for checking potential customers, but the procedure itself is still much simpler than many European banks.
Before choosing a bank, you should clearly define your goals and discuss them with an experienced and competent consultant, because with a competent approach, the use of an offshore bank account brings significant benefits. Despite the media hysteria among investors and depositors, the reputation of offshore banks as a reliable provider of confidential and secure banking services is constantly growing. Thanks to years of well-deserved reputation, offshore banks continue to be an effective tool for providing asset protection and tax reduction, giving high confidentiality of deposits.
If you have any additional questions about how to open an account offshore, in Europe or in a Baltic bank, you can find out all this and more directly from our lawyers using the “question online” service, or by calling our office:
+38 (098) 737-88-88
Our experts will advise you on choosing a bank specifically for your requirements and goals. Contact us!