We don't know about you, but the phrase "offshore bank" leaves us with visions of mobsters, shady businessmen and other financially savvy criminals.
But Marcia Rodriguez, business development officer for Belize's Atlantic International Bank, says banks like hers try to weed out the shadier customers. Most clients are regular people who are simply hoping to take advantage of the higher interest rates available overseas or expand their business internationally.
Here, Marcia shares an overview of how international banks work and offers insider tips and advice on opening an account. Read on:
Tell us about Atlantic International Bank...what financial services do you offer?
At Atlantic International Bank, we offer personal and corporate international banking services such as savings accounts, corporate accounts, term deposits, investment accounts, free online banking, wire transfers, international credit cards, loans, line of credit, overdraft facility and facilitate the movement of 401(k) or IRA offshore.
What are the main reasons an individual would want to use an offshore bank? What are the advantages?
Offshore banking, or, as we like to refer to it, "international banking," has many advantages for clients who are nonresidents or even for those who wish to retire in Belize under the QRP Program.
Nonresidents get to enjoy higher interest rates on their savings accounts with us. Those who choose to hold CDs can get as much as 5 percent, depending on the amount and term of their deposits. We find that many of our clients in their home country often receive less than 1 percent on their deposits. Therefore, when they hear the rates issued by international banks, they gladly make the switch.
Low or no tax incentives are often a major concern when choosing a bank. When nonresidents bank with us, they are not required to pay taxes within Belize, and while this is great, we always advise our clients to stay informed about their tax obligations in their home country.
If you spend a lot of time in another country (like Belize) for vacation, work or retirement, it is best to have an international account so that you can keep your funds in U.S. dollars, which is considered a global currency. Many times, visitors change all their funds into the currency of the host country and when they wish to leave the country, they encounter several exchange controls where they often lose or become very frustrated in the process. Keeping your funds in an international bank like Atlantic International Bank allows you to always have the bulk of your money in U.S. dollars and in close proximity.
What about businesses? Why do they like to bank offshore?
Businesses that require an international account are often those that operate globally. They prefer to have an international account because they have easier access to their funds when they want to pay suppliers and get paid in foreign currencies. Some international banks give clients the option to have multiple currency accounts, which often simplifies trading across borders.
Another reason why businesses choose to have an international account in a particular country is when they are investing in that country. Getting a loan, line of credit or overdraft facility may be easier from the international bank since the investment property is in that country.
Many people might associate using an offshore bank with shady business practices...why isn't this the case? Can you correct the myth?
Many individuals still associate offshore banking with illegal activities. Criminals try to enter into every industry - not just banking. What is important is for institutions like ours to put in place proper mechanisms to keep those people out. At Atlantic International Bank, we conduct proper due diligence on all our clients to ensure that we attract clients who operate within the scope of the law.
Although you will find criminals in every industry, the majority of the people who engage in offshore banking are individuals who want to obtain higher interest rates on their savings. In most cases, offshore banks like Atlantic International offer rates between 2 percent and 5 percent and sometimes even as much as 6 percent. We find that many of our clients in their home country often receive less than 1 percent on their savings. Therefore, when they hear the rates issued by offshore banks, they gladly make the switch.
Our corporate clients are usually persons who have taken their business global. Having an international or offshore account allows them to easily pay suppliers and hold assets in the name of a company.
What should individuals and businesses be doing to ensure they are compliant with the tax/finance laws within their home country while using an offshore bank?
At Atlantic International Bank, we are keen on ensuring that we are operating within the laws of Belize. Therefore, we tell all our clients that it is important that they keep abreast with the tax/finance laws of their home country. In some cases, that means reading or consulting a lawyer, accountant or other financial advisor who can guide them appropriately in ensuring that they are compliant with their country's requirements.
How easy is it to deposit and withdrawal funds from an offshore account? What methods do you offer?
A client can deposit funds into his account through wire transfers, cash, personal checks and bank drafts.
To withdraw, the client needs to send a request asking for his funds to be issued in cash, draft or wire transfer. This can be done online, over the telephone or via fax.
How secure are these accounts?
Atlantic International Bank accounts are very safe. In Belize, all local and international banks are governed by the Central Bank, which monitors our operations on a monthly, quarterly and yearly basis. All banks are required to be audited, and performance reports are published in the media. Therefore, clients can monitor how their bank is doing in terms of profits, losses, assets and liabilities.
In Belize, we are also very proud to state that we have never had a bank fail in our country. That in itself says a lot for our regulatory system.
Finally, we know we don't necessarily have to travel to Belize to open an account with Atlantic International Bank...but why should we try to visit in person? What makes Belize a great destination?
Belize is a great country; Belizeans as well as visitors often refer to it as a little piece of paradise. With only 8,867 square miles, you can explore ancient ruins; swim in the second largest barrier reef in the world; and walk the lush jungles filled with caves, waterfalls and an abundance of flora and fauna.
Moreover, during your adventure, you are guaranteed to meet the many faces that make up what is Belize (Mayas, Mestizo, Creole, Garifuna, German Mennonites, Indians and Chinese). Belize is a diverse nation, bursting with culture and history. Consider Belize for your next venture; be it ad-venture or business venture, Belize has something to offer you.