Offshore bank

The following categories of offshore banks are distinguished:

Offshore banks with a full license (“Unlimited” Class B banks) receive a license from the host country, allowing them to engage in banking and / or trust operations outside the host country. Such banks have the right to work with customers outside the country in which they are located.

Offshore banks with a limited license (“Limited” class “B” banks) receive a license that is similar to the license of an “Unlimited” class “B” bank, except that such banks can only work with those foreign individuals or corporations that are indicated in their license.

Offshore managed banks (“without personnel” banks) operate on the basis of a bank with a general license on a contractual basis between it and the owner of an offshore bank. To create such a bank requires an appropriate license. The base bank carries out administrative functions to manage and support the work of the patronized bank.

"Representative" banks are banks that are organized and licensed in one country and also receive a license from the second country to create a representative office. They cannot do business in a second country, but they can do business with any other country.

A credit institution of a banking type , which is allowed to carry out certain banking functions. ^[2]

Offshore banks, as a rule, do not pay taxes or pay them at much lower rates than resident banks in the country of registration. This gives offshore banks a significant advantage and allows them to pay large interest on deposits. Offshore banks annually pay a registration fee and a license renewal fee.

The minimum paid authorized capital of an offshore bank is much higher than that of a regular offshore company, but usually ten times less than that of onshore (classic, non-offshore) banks.

Offshore bank licenses come in several categories. An unlimited general license entitles an offshore bank to engage in virtually all types of banking operations for servicing non-residents . A limited license imposes restrictions on certain types of operations of a credit institution. An offshore bank can start its work by obtaining a limited license and eventually reorganize into a full-blooded lending institution. Offshore banks are constantly monitored by the financial authorities of the country of registration.

For large international financial institutions with a solid reputation, it is not difficult to register your offshore branch or branch and obtain a banking license. The US stiff stance towards offshore banks has made it virtually impossible for other categories of applicants to register such a bank.

• Offshore

• Offshore and non-offshore jurisdictions in Europe, America, Asia, Africa and Oceania. Practical guidance on the establishment and taxation of foreign enterprises. NPK WESTA, 2008, p.436 ISBN 978-5-98675-002-6