Picture Courtesy of Gratisography

Picture Courtesy of Gratisography

Definition

The term ‘offshore banking’ refers to having a bank account in a bank that is located in a country outside the country of residence of the depositor. 

Offshore banking is often associated with tax-exempt, or low tax, jurisdictions that provide a set of advantages for its customers. Offshore bank accounts attract investors for several reasons, including anonymity.  Other advantages are outlined below.

Advantages of Offshore bank accounts

  • Offshore jurisdictions often require only limited information on shareholders, directors and beneficial owners.
  • Offshore banking is available in multiple currencies, with all the banking facilities available with domestic bank accounts.
  • Favourable interest rates.
  • It is a legitimate way to protect global assets.
  • Offshore jurisdictions are usually politically and financially stable environments.

Common jurisdictions for offshore banking

There are many jurisdictions around the world that attract investors for the banking advantages they offer.  Three of the leading jurisdictions include:

  • Singapore
  • Hong Kong
  • Switzerland

Among offshore banking jurisdictions, Switzerland has long been the leader and offers one of the worlds strictest confidentiality policies to company shareholders and directors.  It is believed this jurisdiction may have once held over 1/3 of the world’s private and institutional funds.

The Cayman Islands is another leading financial centre in terms of deposits held. With attractive tax free incentives for companies and very light financial regulation and oversight, this jurisdiction continues to enjoy much interest from investors.

The Asian financial hubs of Singapore and Hong Kong have become popular for global investors. Hong Kong in particular tends to be very attractive as companies can open a multi-currency bank account.

Healy Consultants Group PLC preferred offshore jurisdictions

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Healy Consultants Group PLC preferred offshore jurisdictions

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