Foreward by Andrew Chilvers
For companies and individuals looking to move into new jurisdictions for business opportunities, setting up a bank account is a crucial part of the process. But this is never as straightforward as it seems.
In all countries, banks are obliged to crack down on fraud and any potential financial scullduggery. As a result, they tend to be very risk averse. Regardless of where a business establishes an office in the world, local banks will generally have the newly arrived expatriates jumping through various hoops, pulling their hair out in frustration.
The new arrival will need the relevant paperwork, including personal identity papers, a personal and business address, personal references and other numerous documents. And that’s just the beginning.
Every jurisdiction has its own banks and banking rules, which are often complex and bureaucratic. Consequently, seeking advice from local legal and financial experts before setting up a bank account is imperative if a company is it get the right account for its particular business objectives. This is why it’s so important to use local advisers who are experts in the jurisdiction to provide information about the local banking rules.
What is the general risk appetite of banks in your jurisdiction and how does that affect setting up a new business bank account?
Banking is a risky business. With anti-money laundering and anti-terrorism rules, reporting requirements, risk of sanctions and fines, de-risking, additional and more complicated reporting requirements, it’s hard to navigate the minefield. Therefore, some of the requirements many of you will come across when trying to open a personal or business account may seem daunting. This paper hopes to make the process easier to understand and navigate as you establish a bank account for your corporate needs in Barbados.
In Barbados we have five major banks. There’s the Canadians (Scotia, RBC and CIBC’s FirstCaribbean) then we have the Trinidad-based Republic Bank and FirstCitizens. All are reputable. All are sophisticated in terms of their online banking capability and general infrastructure. Each bank will have their own procedures, policies and risk appetite. But below is the basic information you will need to open a corporate bank account.
The risk appetite for most banks can be described as low to moderate. Internal policies will weight risk based on a number of factors including country, industry, whether or not the ultimate beneficial owner(s), director(s) or authorised signatories are politically exposed. Country risk for Latin and Caribbean as well as Middle Eastern countries tend to be higher (and therefore more challenging to establish accounts), whereas developed western countries (the US, Canada, UK) tend to be assigned as lower risk.
The US may have additional requirements such as confirmation of tax compliance and documents needed for FATCA reporting. Business and personal expatriate accounts tend to carry the same appetite and rigour to open business accounts. Foreign exchange restrictions have been relaxed over the last year, but some expatriates feel comfortable keeping some of the majority of their income in an account outside of Barbados with local accounts for in country expenses.
How accommodating are banks in your jurisdiction for opening a business and personal bank account?
Barbados is generally well known in the international community with international banks and firms operating for a number of years. The large accounting firms KPMG, PWC, E&Y and Deloitte have operated in Barbados for over 40 years with recent additions from the likes of Baker Tilley and BDO. Similarly, Barbados boasts a mature banking industry with local and international banks and a number of mergers over the years. Banks such as RBC have operated in Barbados since 1911. Therefore, clients want and are comfortable with opening an account with local or international banks in Barbados.
Information and Documentation Required:
Shareholders, Ultimate Beneficial Owners (‘UBOs’)
1. Declaration of Source of Funds (usually the bank will have a form they will require the UBO to sign) with supporting evidence
2. W-8BEN OR W-9 Form where applicable
3. Certified proof of address (utility bill is preferred and should be no older that 1 month old)
4. Written reference dated within 2 months with individual’s name and address from a financial institution confirming a current relationship that is satisfactory and that has existed for at least two years. Reference must be on the bank’s letterhead and should be addressed to: the name and address of the bank the account is being opened at
5. Professional reference (from an Attorney or Accountant who has known the individual for 2 years or more). Reference must be on the firm’s letterhead and should be addressed to: name and address of the bank the account is being opened at
6. Certified copies of two valid pieces of identification (ideally a passport along with drivers licence or national Identification) that are/have:
A – Government issued
B – Photo-bearing
C – Date of birth
D – Unique identifier #
E – Signature
Directors, Officers and Authorised Signatories
1. Certified proof of address (utility bill is preferred and should be no older that 1 month old. Most institutions will also accept confirmation of address in the bank reference presuming that is from a recognized and reputable institution).
2. Professional reference (from an Attorney or Accountant who has known the individual for 2 years or more. Reference must be on the firm’s letterhead and should be addressed to:
3. Name and address of the bank the account is being opened at
4. Certified copies of two valid pieces of identification (ideally passport along with drivers licence or national Identification) that are/have:
a. Government issued
b. Photo-bearing
c. Date of birth
d. Unique identifier #
e. Signature
Companies
Corporate bodies that are – Shareholders, UBO;
1. Declaration of Source of Funds (Bank will normally have a form they will ask the director or authorized person to complete and sign) with supporting evidence
2. W-8BEN-E Form
3. Certified copies of Certificate & Article of Incorporation/Association/Memorandum
4. Certified copy of By Law
5. Certificate of Good Standing – Original or certified copy
6. Certified copy of Register of Director
7. Certified copy of Register of Shareholder
8. Certified copy of Certificate of Incumbency (List of Officers authorized to sign on company’s behalf)
9. Copy of most recent Financial Statement.
10.Certified copy of resolution or extract of minutes with resolution to open the bank account (the bank will also provide a template of resolution for Director and or authorised person to sign)
Corporate Bodies That Are: – Directors, Officers
1. Certified copies of Certificate & Article of Incorporation/Association/Memorandum
2. Certified copy of By Law
3. Certificate of Good Standing – original or certified copy
4. Certified copy of Register of Director
5. Certified copy of Register of Shareholder