How to choose the right offshore bank
Finding an international bank account that meets your needs can be tricky if you don’t know precisely what you need to look for. This quest can seem especially troubling if you’re worried about how secure your funds are in a bank located in a foreign jurisdiction.
You’d be right to ask hard questions, especially if you’re looking to establish a relationship with an offshore bank as part of your long-term financial plan. After all, one of the cornerstones of a sound financial plan is to diversify your risk, so it pays to properly assess your options when choosing the right international banking partner.
The question then is: what should you look for in an offshore bank to give you the assurance that you’ve made the right choice?
What is an international bank account?
The key to asking the right questions is understanding what you should expect from an international bank account.
The simplest explanation is that an offshore account should allow you to bank, save and transact with a financial provider located overseas. And your account should be denominated in a major foreign currency such as US dollars, pounds or euro.
Crucially, you should be able to bank with ease even when taking into account rules, such as limits on foreign exchange transfers, that govern international banking.
One of the biggest advantages of a foreign-currency account is that you can now easily transact in that international currency. Having foreign funds available to pay for holidays, purchases, education or investments like property substantially lowers currency conversion uncertainty, as well as associated foreign exchange costs.
How jurisdiction influences international bank credibility
Apart from choosing a known or recognised brand, one way to reduce your concerns about the safety of your deposits is to choose a bank in a recognised financial jurisdiction.
Destinations like Jersey and Isle of Man, where Standard Bank Offshore is located, offer far greater peace of mind for a few key reasons. The first is that they are recognised as international banking centres that have been set up to provide international banking services to non-resident clients.
They derive their credibility from a strict regulatory environment that protects depositors, while setting out the rules that govern how financial services companies should operate. These rules include a strict governance and transparency framework that aim to prevent money laundering and corrupt practices.
In addition to the legal framework, you’re afforded a degree of security in Jersey and Isle of Man in the unlikely event that your bank fails by mandated depositors’ protections. The Jersey Bank Depositors Compensation Scheme offers protection up to £50,000 for an individual or charity, while the Isle of Man Depositors Compensation Scheme offers the same protection for individuals, other than a trustee or nominee.
Should any international bank that you’re considering not be a member of such a depositor protection scheme, then you might want to ask why and probably reconsider your choice of offshore banking partner.
These assurances and protections are non-negotiable if you’re looking to implement a robust financial plan built around international diversification.
Tax and legal compliance
Another reason the location of your chosen international bank is important is because you don’t want to fall foul of legal or tax regulations.
The global financial industry has rightfully placed increased emphasis on implementing anti-money laundering and anti-corruption practices. The increased scrutiny from industry and law enforcement authorities means that non-compliant banks could have accounts or operations halted.
This is a risk that you can avoid simply by choosing a reputable bank that is properly registered and complies with local and international finance rules.
An international bank with scale and reach
Standard Bank Offshore has invested heavily to establish a strong presence in recognised financial centres and employs more than 450 people in Isle of Man, Jersey, London, Mauritius and South Africa. This team helps us provide banking, wealth management, trust and company administration, asset management and investment services to private and corporate clients.
As part of Standard Bank Group, we are committed to doing the right business, the right way, in line with the UN Principles for Responsible Banking, Equator principles, and The Paris Agreement.
These accords aim to improve transparency and financial rigour while committing to sustainable business practices and financing.
Our Jersey office is our largest international operation with around 250 employees based in St. Helier, with another 200+ staff located in Douglas, the capital of Isle of Man. They contribute enormously to our rich history of serving discerning clients who expect to bank globally with ease and convenience.
If you’re looking for an offshore bank, speak to us today to hear how we can help you to open an account that offers convenience and peace of mind. South African applicants can email us at [email protected] and all other applicants outside of South Africa can email [email protected].