Dateline: En route to Tivat, Montenegro
Having at least one offshore bank account can not only help diversify your funds, but serve as what we call a “tunnel” to be able to move more funds overseas in the future as needed. With the world getting crazier, having assets in more than one country is not only legal but reasonable to protect your hard-earned cash as well as earn higher interest rates or diversify among currencies.
For many westerners, Europe is a known commodity and the first destination many Americans, Canadians, and Australians – as well as other Europeans – consider for banking.
The European Union makes stringent AML (anti-money laundering) and KYC (know your customer) rules for banking, let alone ordering an architectural inspection on a house in some countries, so don’t expect EU countries to be the “easiest” places to bank offshore.
We do help our clients open bank accounts in numerous European countries, and avoid plenty of others. In this article, you’ll learn how offshore banking in Europe really works and what is required of you.
Before we get started though, let’s get one thing straight: “everything is easy and nothing is easy”. How you define “easy” will define whether you should open your offshore account in Europe or somewhere else.
Challenges of Banking in Europe
1. Paperwork
Europe loves its paperwork. While some of the countries at the fringe are more efficient in opening bank accounts, the name brand countries will demand 40-page application forms, apostilles, notarized copies of every passport, and sometimes years of business P&Ls or investment history. It’s up to you to decide whether private banking in countries like Switzerland or Liechtenstein are worth it.
2. Higher Fees
While banks in emerging countries have low or even zero fees, private banks and priority banks in Europe have higher fees than their Asian counterparts. In our opinion, this has little to do with service and everything to do with
3. Stronger Connections
Banking in Europe often requires some kind of residential or investment connection to a country, like a residence permit, citizenship, or property ownership. As you’ll read throughout this article, those things aren’t bad to have as additional diversification tools, and in countries like Turkey you can even get citizenship for making a bank deposit. But for pure banking needs, prepare to deposit six or seven figures if you don’t have a connection to the country except for eastern European countries.
Now, let’s dive in to the easiest and best places to bank in Europe for non-residents.
Easiest Countries to Bank in Europe
1. The Caucasus (Georgia, Armenia, and Azerbaijan)
The first countries on our list aren’t technically even in Europe; Georgia has an eastern European feel and aspires to join the European Union while almost nobody will claim Azerbaijan is part of Europe. Yet these countries’ desire to make their attract capital has made them easier to work with.
And if your definition of “easy” is a low deposit, banks in the Caucasus – the region east of Turkey and south of Russia – will open an account with as little as $0. Talk about the ultimate tunnel you can keep on hand without much effort, and then use later.
Georgia has long been our favorite because the two largest banks – TBC and Bank of Georgia – don’t require you to be a resident to open an account. Most of the rest, especially the foreign banks, either focus on specific customers or only want residents or citizens.
Both TBC and Bank of Georgia open retail accounts to anyone who walks in, although you may want a local attorney to help you ensure the process goes smoothly before you fly out. Both banks are also traded on the London Stock Exchange.
Americans will need to undergo FATCA checks, but most everyone else can open a bank account in Georgia in as little as 30 minutes. If you want priority service, you can open an account with TBC Status or Bank of Georgia’s Solo program, which has dedicated and luxurious branches and requires as little as $20,000 in deposits (requirements change from time to time).
We even offer a service that helps clients open a bank account in Georgia remotely via a power of attorney; while it’s often better logistically and emotionally to visit your new bank in person, this can be a good alternative for anyone looking to get started from home.
Georgian banks no longer pay competitive interest rates on dollars, euros, or pounds, but pay 11-12% on Georgian Laris which have performed well against the dollar as of late.
Armenian banks have become more difficult to manage, generally requiring you hold a residence permit. If you have Armenian descent, you are entitled to Armenian citizenship which may fulfill that requirement and give you a backup passport; if not, you can start a company, hire one employee, buy real estate, or invest in bonds as a way to get residence and therefore open a bank account.
The benefit of Armenia is higher deposit insurance; while Georgian banks have about $6,000 in government coverage, Armenia’s is several times larger and protects a mid-five figure sum depending on which currency you bank in. Armenian banks still pay decent interest rates on currencies like the US dollar, as well as excellent rates on their own Armenian dram which perfectly quite well against the dollar in recent years.
Azerbaijan has always has the worst reputation among the three countries, partially because it’s easier to bank there. Most of the region’s hot money went through Azerbaijan, with Georgia and Armenia passing on more risky clients in recent years. Our founder went to Azerbaijan and found the process stupidly simple, although English isn’t widely spoken. That said, Azerbaijan is the wealthiest of the three countries.
2. Balkans (Serbia, Montenegro, Albania)
The Balkans used to be easier to bank in, but are still possible. As is the case with many things in this region formerly called Yugoslavia, who you know matters. You will see more regional and pan-European banks in the Balkans which may be more assuring to some new offshore banking clients, since Caucasian banks are mostly local only.
Serbia is the largest of the western Balkan countries and banks like Raiffeisen or OTP may be willing to open an account using a hotel or Airbnb as an address. Some city center branches of these banks may have dedicated people who speak English and maintain accounts for foreigners. Keep in mind that interest rates in Serbia are generally low, but the country has a tried-and-true 50,000 euro deposit insurance plan.
Montenegro is more touristy, with some beautiful coastline just south of Croatia. Opening a bank account here used to be easier, but most larger banks don’t want foreigners now. As in some other European countries, you can bypass these issues by obtaining a residence permit which requires you to buy basically any property or start a company and pay yourself a monthly pittance. We help our clients obtain residence in Montenegro and elsewhere.
One hack for banking in Montenegro could be walking into a smaller bank in a tourist center like Porto Montenegro. Our founder’s first account was opened in Budva which also may be possible. Try smaller banks where foreigners hang out.
Albania and North Macedonia are perhaps easier and they claim to be explicitly open to foreigners, but you’ll still want a reason for having the account. “I don’t trust banks in the United States” probably won’t sit well with a banker who thinks their country is troubled and sees the west as some panacea. Even if they’re wrong, they may not open your account.
3. Portugal
As the first entrant on this list in the European Union, Portugal may be more attractive to those who don’t mind greater regulations in exchange for greater security. EU member country banks must insure your funds up to 100,000 euros.
While you may not be able to walk in off the street, advance planning with Portuguese banks can allow you to open an account. There are plenty of retail banks with four-figure minimums, as well as a few priority banks with six-figure minimums. Like many European banks, many have asked us not to explicitly name them publicly.
The easiest way to bank in Portugal is to get a residence permit there whether the country’s Golden Visa – which has been as on-again, off-again as Ben and Jennifer – or a less expensive self-sufficient residence. Sometimes you can get a bank account on the basis of considering obtaining residence, as in planning ahead for applying for immigration status. Obviously we would always suggest you are honest with the bank but if you say you’re exploring Portugal and deciding on whether to invest there, that can help.
4. Hungary
Like Portugal, Hungary can open retail accounts for smaller depositors on a somewhat random basis. If you’re willing to fly to Budapest and can demonstrate some interest or connection to the country, they may be open in working with you. Our advice is to never view banking in a foreign country as you would in your own: outside of places like the Caucasus, simply walking in and saying “I want a bank account” isn’t going to work to overly conservative bankers. You either need to know someone, or plan ahead with the bank before you travel.
Workable but Less Easy Countries to Bank
We’ll come clean: private banking in Europe is overrated and overpriced in our opinion. Many banks are coasting off of their legacies, which as we saw with Credit Suisse aren’t always what they’re cracked up to be. Our clients are often happier banking in more transactional Singapore than they are in Switzerland, but if you insist on higher-level European banks, you have a few options.
1. Andorra
Andorra is perhaps the most manageable European destination for private banking, with minimums starting at 500,000 euros and some banks demanding 1 million euros for a relationship with them. The account opening process is easier and we’ve found Andorran banks are more flexible to making house calls or even visiting you elsewhere in Europe (we met an Andorran banker at their office in Barcelona, for instance).
Fees in Andorra will be higher and the small country – bordered by Spain and France – doesn’t have as clear of a deposit insurance scheme as other European countries. Historically, the banks just bailed each other out if there was ever an issue to ensure the principality remained attractive. This old school way of operating may be appealing or unappealing to you.
One of our biggest concerns with private banking in Europe – which makes up the main offering in these countries we’re less excited about – is how bankers claim to be able to handle your entire investment portfolio and global tax needs yet we haven’t found bankers to be knowledgeable about things like US SITUS assets. For 1,000,000 euros and the reputation a place like Andorra demands, they should know better.
2. Switzerland
Swiss banks have become the brand name for private banking of the world’s affluent, attracting everyone from the Wolf of Wall Street to YouTubers like Noah Kagan to share their experiences there. However many Swiss banks are simply not interested in foreigners, and very few are interested in Americans. (We work with one Swiss bank that accepts US citizens, with a starting deposit of $1 million).
Swiss banks have among the most complex onboarding processes; if you have an in-house finance team as we do, this is of course more easily managed, but they will still need to speak with the owner of the account and may demand plenty of documents.
Switzerland charges fees in line with the reputation it has earned, meaning you may pay from 3,000 to 15,000 Swiss francs per year just to maintain the account, as well as fees on holding investments, trading stocks, or holding currencies. If it sounds like we’re opposed to Switzerland, we’re not; we just think anyone with less than $5 million has better options.
3. Liechtenstein
This tiny Alpine nation may be one of the most convoluted places to bank and certainly has a high opinion of itself, but opening a bank account is doable. Our founder has talked about his experienced, where his high-six figure opening deposit was scoffed at as bankers told him “sometimes we’ll reply to you the same day, while other times we’ll take three weeks”. If you expect to be served by an actual Liechtensteiner, good luck.
There are one or two banks that will open accounts with starting deposits in the 300,000 to 500,000 Swiss franc range but that won’t get a lot of attention. You’ll also pay high fees for them to manage your money, as well as any negative interest rates on currencies like Swiss francs (usually with lower thresholds than banks in Singapore apply). The account opening process is more manageable than Switzerland in our experience, but still requires you to have all of your wealth documented by category, from properties you own to stocks.
4. Latvia
It’s been years since our company banked in Latvia, an ordeal that ended up with our priority bank playing games with us for the last four months before we hired a lawyer to fight tooth and nail to finally get our money back.
Latvia had a reputation for being a money laundering destination for Russians and so banks pressured their clients in response to Latvia’s central bank pressuring them in response to the Federal Reserve pressuring it. That led to banks doing strict checks on every transaction in and out, which was less of an issue for someone merely using a Latvian bank to make investments rather than transactions.
If you do business in eastern Europe or just want the higher-level service and advanced private banking at a lower price than Switzerland, Latvia may be worth it. Your banking relationship may also entitle you to a residence permit which likely won’t lead to citizenship but allows you full-time access to the European Union.
Banking Countries We Rarely Recommend
There are plenty of countries we don’t recommend banking in unless you have a specific reason to, such as owning a home or having a corporation as part of your business structure.
Owning property or being a resident is often a reason a bank may give you an account. That not only makes having residence permits or citizenships appealing to expand your financial options, but it doesn’t mean that the bank won’t still demand plenty of paperwork.
For example, if your offshore business includes a German company for collecting payments from German customers, you would of course need a German bank account… as well as a tax plan to ensure you don’t pay more than you need to.
One country we avoid is Monaco. If you’re planning on relocating to Monaco, you will need a bank account there to deposit the 500,000 euros needed to establish residence. The government basically relies on the banks to conduct much of the due diligence for them, so bank account opening is a pain.
If you’ve lived anywhere exotic (ie: you’ve been tax resident in the Cayman Islands), banks in Monaco likely won’t touch you, meaning you can’t move there. It’s a literal Catch-22, so our advice is those interested in Monaco move directly from the US, Canada, another western European country, etc. Don’t plan on banking in Monaco for kicks, and even if you want to live there the process will be involved.
Most countries not known for banking – from Norway to Germany to Spain – won’t onboard non-residents unless you have a good reason. Again, it’s easy enough to obtain residence permits in some countries to unlock new banking options and immigration privileges at the same time which creates a greater Plan B, but there are always caveats.
For example, becoming a resident of Spain isn’t hard through the country’s Golden Visa program which creates two residential ties – real estate ownership and immigration status – but spending too much time in Spain could subject you to Spain’s notoriously crazy tax system.
How to Open a Bank Account in Europe
As you can see, not only is opening an offshore account not “easy” per se, but the requirements to do so are often connected to other issues. After working with 1,500+ high net worth clients, we’ve realized that most of them don’t just want a bank account; they want a solution for asset protection and diversification that goes beyond one account.
If you’re just starting out, consider a small bank account in a country like Georgia that will be easy enough to open and not require much ongoing maintenance. We have a trusted attorney that handles these account openings remotely or in-person for a reasonable fee.
We’re not suggesting to move your entire fortune to a Georgian bank, but it’s a good way to get started. If you want to go more all-in, or your definition of a small deposit is much more substantial, you may want help opening a bank account.
One advantage of some European private banks is they’re more open to accounts for offshore trusts in places like the Cook Islands, as well as European foundations that are more appealing to European citizens.
If your goal is asset protection and you’re depositing enough to entice a Swiss banker, chances are you should be considering the tax consequences, compliance requirements, and legal structuring of your offshore assets more than just saying “I want a bank account”. Once you’re into the six, seven, or eight figures, it’s worth consulting an expert.
Nomad Capitalist assists such clients in evaluating their holistic needs and wants and creating a bespoke Plan complete with a variety of banking options in Europe as well as worldwide, company and trust formation advice, and overall tax and asset protection. You can learn more about our service here. In some countries, you may even qualify for a residence permit in another country by virtue of your bank deposit which offers an additional level of protection.
