THE BEST

OFFSHORE BANKS

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INTRODUCTION

Having an offshore account is a fundamental step in diversifying yourself

internationally. It is an excellent way to diversify against sovereign risk,
currency risk, and more.
Its especially important in todays environment where governments will find any excuse from terrorism to money laundering to the bogeyman - to impose de facto capital controls.
Having a portion of your assets out of your home country makes it more difficult, if not
impossible, for said government to freeze or confiscate your assets.
There are a number of important factors to consider when opening your account.

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These include:
The jurisdictions openness to foreigners (and, in particular, United States citizens or
residents)
Taxation of interest income
Range of services including currency options
Stability of the jurisdiction
Deposit insurance
Lets take deposit insurance. In places like the United States or the European Union, deposit
insurance is almost an afterthought. Unless, of course, youre a small European country
needing a bail-out and thought to be holding money for the Russian mob - then youre
screwed.
However, each jurisdiction has its own bank insurance policy that you should examine
before opening an account. Places like Singapore take an attitude that deposit insurance is
somewhat of a moral hazard and have much lower insurance maximums than other
developed countries.
Singapore, for one, also does not insure deposits in foreign currencies, which again
matches their goal of protecting smaller, domestic depositors who need the money, not
foreigners looking to diversify their assets.
While most of the developed world does insure bank deposits, a few do not. Andorra, for
example, has a deposit insurance scheme which is hard to understand and it is unclear how
the fund would actually repay depositors of a failed bank.
Of course, you should again evaluate the stability and history of any place where you put
your money to make sure you wont get Cyprus-ed in the future.
Many jurisdictions worldwide are open to accepting foreign customers, although some have
many hoops you must jump through. Well identify those in this report. An unfortunate part
of the global war on terror is the OECDs heightened Know Your Customer
requirements, which make opening a foreign account difficult.
Many banks, forced to comply with more and more draconian regulations, require you to
visit them to open your account. However, there are plenty of banks that open accounts
remotely.
Along those lines, an important consideration to make is which type of bank you feel most
comfortable with.
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You may prefer a more liquid, local bank over a huge multi-national. It should also be
considered that it may be easier for your a government agency, court, or plaintiffs lawyer in
your home country to access funds in a bank which maintains a presence there. It will be
easier to get them to hand over your funds if their bank does business in your country and
could be sanctioned for not doing as theyre told.
Another important factor is taxation. While many international finance centers tax based on
a territorial system where income earned outside the jurisdiction isnt subject to tax, income
earned in their banks certainly meets the local source test. Some of these jurisdictions do
tax interest, others do not. Those that do tax interest may require a local tax ID number to
be obtained. Obviously, this will slow the process down.
Finally, you should consider the range of services each bank offers. If you are moving money
to another jurisdiction to avoid sovereign risk, you may well want to hold your foreign
deposits in another currency.
Obviously, each country has its own currency which will be the default currency that most
people there hold their assets in. You may or may not be comfortable holding your deposit
in that currency, however, and may want to choose a bank that offers an array of currencies
to choose from.
Unlike in the United States, for instance, where non-US dollar deposits are rare and not
typically advertised, international banking hubs routinely advertise well over a dozen
currencies to place your deposit in. You dont have to open an account in Switzerland, for
example, to have an account denominated in Swiss francs.
When opening an account in a foreign currency, you should consider the stability of the
currency, its exchange rate history, and other factors that may come in the future. Much of
the world is in a race to the bottom to devalue their currencies, which you should take into
account.
For example, is the currency backed by resources in the country? Is it pegged to another
currency?
The Hong Kong dollar, for instance, is pegged to a tight range of the US dollar. However,
some commentators believe that the Hong Kong authorities will be forced to re-peg the
value against the dollar, causing an immediate change in value, or peg it to the Chinese
yuan. You should do your homework to understand any currency you choose to hold your
assets in.

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At the same time, foreign currencies whose countries havent set interest rates at zero may
also offer higher interest rates. Many emerging countries offer high - even sky high - interest
rates out of need for foreign capital and their ability to loan money at uber-usurious rates,
places like Australia simply havent joined the global race to the bottom because they
havent need to. But again, always do your homework.
The media and government want you to believe international banking is illegal. As I write
this, its not. Millions of expats from around the world live outside their home country and
maintain bank accounts in their places of residence. Nothing crazy about that.
You, too, can achieve global diversification and take advantage of a better banking
environment elsewhere in the world. For many, its amazing to think that some countries
have never experienced a bank failure in their history, while others havent had one for
decades.
If youre in the United States, youve seen hundreds of banks fail just during the global
financial crisis. Opening your mind, when done with accompanying due diligence, can offer
a new array of benefits to you.

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BANK FROM HOME

Many people want to open an offshore account, but dont have a large enough deposit to
justify traveling or do not have the time to travel. Thats where this guide can help. There
are dozens of banks around the world that will allow you to open a bank account without
visiting the bank in person.
It can all be done remotely. There are two ways to do this.
Option 1: Banking with a Multinational
While not available in all jurisdictions, one easy way to get around a personal visit to a bank
is to use a multi-national bank with a presence in your home country. It is often possible to
open an account over the internet or at the banks branch in your country, then have that
account migrated to the multinationals bank in another country.
The best example of this is HSBC. HSBC has 7,200 offices in 85 countries on virtually every
continent. Youd be hard pressed to find a civilized nation without an HSBC presence of
some sort. In 2012, Global Finance ranked HSBCs UK holding company the 19th safest
bank in the world, higher than any other bank with its international presence.
HSBC allows its customers to open accounts in approximately fifty-eight countries
worldwide once establishing their home country account. The process is rather
straightforward.
First, you must open a HSBC Premier account at home or in any country that allows nonresident foreigners to open accounts. This can be your own country, the US, Canada, Hong
Kong, Singapore, or even the UK.
This Premier account does require a minimum balance which varies by your country of
residence; in the United States, the minimum is $100,000. In Hong Kong, its a bit higher.
If youre a US resident opening a US Premier account, you can do it online. Just make sure
you choose the Premier account rather than a general account or Advance account when
signing up. Once your application is completed and processed youll be assigned an
account manager, somewhat like a lower level version of a private bank.

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That account manager will assist you in setting up an account in another country or
countries, and youll be assigned an account representative in those countries as well.
It should be noted that if youre willing to travel but not far, Americans can open HSBC
accounts in Canada, too. If you live near Toronto or Vancouver it might be worth a cheap
day trip in order to keep your $100,000 base deposit in another country. Just know that you
must keep the minimum deposit in your base country.
Once established, youll have online access to your accounts and be able to move money
back and forth between accounts in each country.
An interesting part of the HSBC program is that as long as the minimum balance in your
home country is met, you arent required to meet minimum requirements in other countries.
For example, Hong Kongs minimum requirements are higher, but as a US customer, your
US$100,000 will keep you in good standing.
So if you decide to go and live in Malaysia, for example, you can use your US Premier
account to get you Premier status in Malaysia even if you only maintain a small checking
account there. The benefits of Premier status arent that great and they dont serve you
champagne like UOBs private bank in Singapore, but you will get slightly better service.
As with any international bank account, you should be careful about fees. Most banks will
quote you an exchange rate at the time of transfer which will include any built-in spread
they charge for the conversion. Canada, for example, tends to charge very high conversion
fees despite the high amount of trade from US to Canadian dollars. Hong Kong banks
charge very, very low conversion fees.
Keep in mind that currencies that are less frequently traded - even if they are quite stable may have a wider spread attached. While I do believe that maintaining an international
bank account is all about sovereign risk, part of which is the risk of holding only one
currency, you should be able to transfer your home currency (ie: US dollars) to your
international account without a fee if you intend to hold that same currency there.
Unlike in the US, many international accounts allow you to hold a wide array of currencies,
probably including the one you bank in now.
Keep in mind that while HSBC, for example, is a large multinational bank holding company,
each bank is registered in its own country. In the United States, it is incorporated as HSBC
Bank USA, NA. In Hong Kong, where HSBC (Hong Kong and Shanghai Banking
Corporation) started in 1865, the bank is incorporated as a licensed bank domestically, as
well as having three licensed international banks.
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Option 2: Local Banks that Allow Remote Opening

Some countries make it nearly impossible to open bank accounts even if you go there in
person. Bosnia, for instance, requires that all foreigners have their passports and financial
histories translated to Bosnian and notarized. Yikes.
On the other end of the spectrum are countries where not only can anyone open a bank
account, but anyone can open one without being there in person. Belize and many
Caribbean countries allow this, as they can conduct KYC procedures via mail.
Many of those banks are listed in this guide. Some accept Americans while others dont. A
bank that allows for remote opening is often located in a country that does not offer
western-style comforts like deposit insurance, and is typically a traditional offshore
country on an island somewhere.
However, there are several western banks, even in the United States, that allow for remote
opening. A shrinking number of multi-national banks allow you to call the bank in the
country you wish to bank in (ie: the United States), open the account by speaking with them
via email or phone, and then showing up in person at a branch in another country to
undergo Know Your Customer checks.

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ANDORRA

ANDORRA IS ONE OF EUROPES BEST KEPT SECRETS, WITH AN OLD

SCHOOL BANKING BUSINESS AND SOLID INSTITUTIONS.
Andorra is one of Europes microstates, nestled between the Catalan region of Spain and
southern France. The country has no airports, so the easiest way to get in is to fly to
Barcelona and drive up the windy mountain roads, or take a three-hour bus. As a tiny
country with few resources other than snow for skiing, Andorra has an age-old tradition of
serving as a banking hub for wealthy Europeans.
Banks here are highly conservative. There are only six of them, all local. Only one bank has
ever failed, and that was 50 years ago. When that happened, the other banks got together
to guarantee deposits in order to keep their countrys competitive edge. That said, Andorra
does not have an explicit deposit insurance program.

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Opening an account in Andorra is simple, but you do need to show up in person at least
once. Banking here is not so transactional as it is relationship-based. However, unlike at the
banks in Switzerland, you wont need a seven-figure balance.
And because the banks are local, they dont have branches all over the world, meaning they
can adhere to Andorra laws and be less concerned with bowing to some EU or US dictate.
The downside of this is the banks earn their money on fees; expect to pay an annual fee no
matter how much you deposit.
Andorra is a good place to bank:
If you want a strong, conservative banking jurisdiction in Europe
You are storing wealth rather than spending it
You are willing to fly to Andorra and open an account in person

The Best Banks in Andorra

Andbanc
Minimum Deposit: Varies
Remote Opening: No
http://www.andbank.com/en/

Accepts US Persons: Rarely

Accepts Offshore Companies: Yes

Banca Privada dAndorra

Minimum Deposit: 100,000
Remote Opening: Rarely
https://www.bpa.ad/eng/

Accepts US Persons: Yes

Accepts Offshore Companies: Yes

Crdit Andorr
Minimum Deposit: 100,000
Remote Opening: Rarely
http://www.creditandorragroup.com/en

Accepts US Persons: Rarely

Accepts Offshore Companies: Yes

Morabanc
Minimum Deposit: 50,000
Remote Opening: No
http://www.morabanc.ad

Accepts US Persons: No
Accepts Offshore Companies: Rarely

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