Guernsey offshore banking is misunderstood and largely overlooked, and that’s too bad. This tiny island is home to over 20 banks offering a wide range of services to unique client profiles.
Unlike neighboring banking options like Jersey, Guernsey takes a more tailored approach to services and is usually only worth considering if you have a specific profile.
Applicants who don’t fit into one of these client categories, which we’ll discuss below, have other options to consider, including other offshore banking hubs in Europe, Asia, and the Caribbean.
We are going to explore the specific client types that are best positioned to benefit from banking in Guernsey below. We are also going to share the specific benefits and advantages that clients here look forward to and how to get started with banking in Guernsey, even if you’re starting from scratch and have never banked offshore or in the Channel Islands before.
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Feel free to jump ahead to the areas most relevant to you by using the table of contents below.
Table of Contents
- Guernsey Offshore Banking 101
- Who Should Consider Opening Accounts in Guernsey?
- What Financial Services Are Available in Guernsey?
- What Are the Challenges of Opening International Accounts in Guernsey?
- Frequently Asked Guernsey Banking Questions
- Do You Want Help Opening a Bank Account?
Guernsey Offshore Banking 101
Guernsey offshore banking is often misunderstood. This is because most people simply label Guernsey as a “tax haven” and assume it has limited banking options.
Banking in Guernsey, however, is far more sophisticated than the typical offshore financial center. Guernsey even stands out when compared to other quasi-UK banking options like the Isle of Man, which generally require lower deposits and offer standardized services.
Here’s a quick overview of what you need to know to determine if banking in Guernsey is right for you.
Bailiwick of Guernsey
The Bailiwick of Guernsey is a collection of small islands, sitting off the coast of Normandy, France. Just like Jersey, Guernsey is a British Crown Dependency, and together they form the Channel Islands.
The Bailiwick of Guernsey includes three separate states (or sub-jurisdictions) which are Guernsey, Alderney, and Sark. Each of these states is its own island, has its own corporate registry (except for Sark), is fiscally autonomous, and makes its own laws related to taxation and a variety of other civil matters. We are only discussing Guernsey in this article.
Similar to Jersey, Guernsey also has strong ties to the UK and the City of London. As a Crown Dependency, the UK is responsible for defense and foreign affairs. Additionally, local legislation still technically requires approval from the UK Privy Council.
Guernsey Offshore Industry
Like many offshore jurisdictions, Guernsey has evolved since the mid-1900s when the banking sector started to expand. London merchant banks established a presence in the 1960s and the groundwork for Guernsey’s offshore financial industry was formed.
The evolution of Guernsey’s banking industry was (and still is) heavily dependent on specialized financial and wealth management industries. This includes the formation and administration of trusts, the administration of various investment vehicles, and captive insurance entities.
Not surprisingly, Guernsey has become a popular jurisdiction for institutional investors and financial service professionals. Banking in Guernsey has also become a favorite destination to service the banking needs of such entities.
Guernsey Offshore Today
Today, Guernsey banks have over £100 billion in deposits, making it a significant offshore financial center. Unlike other financial centers, Guernsey doesn’t find itself on any blacklists or watchlists.
Guernsey, instead, is considered a tax haven. Compared to other offshore financial centers, it has no capital gains tax, no inheritance tax, no wealth tax, no corporate tax (except for banks at 10%), and favorable income tax rules.
Plus, Guernsey has many other benefits as well. We share more details on these specific benefits below.
Guernsey Becoming Increasingly Important
Guernsey is becoming increasingly relevant to certain client groups, in particular, those active in fund management, estate planning, international asset management, private equity, and more.
For example, in 2018 over 30% of the European junk bond issuance moved to Guernsey’s stock exchange. This represented over US $25 billion in one year. Two years prior, that number was basically zero. This was thanks to new EU regulations forcing transparency on bond issues, which (thanks to its independence) don’t apply in Guernsey.
Likewise, while the EU and the UK continue to wrestle through their marital issues, Guernsey is an independent state from all involved parties. This makes Guernsey (along with Jersey and the Isle of Man), an ideal hub for individuals and businesses that have financial commitments in both the EU and the UK — especially if SEPA transfers are a priority.
Finally, Guernsey is an important launching pad for companies planning to list on the London Stock Exchange. There are more Guernsey companies on the LSE than any other country in the world — not including the UK of course.
But, what if you don’t have any plans to list on the LSE or issue European junk bonds? Well, banking in Guernsey might still work for you.
Who Should Consider Opening Accounts in Guernsey?
Now that you’re up to speed on banking in Guernsey and its status as an offshore hub, let’s discuss who should consider banking here.
Client Types That Are Eligible for Offshore Banking in Guernsey
- Institutional investors
- Guernsey trusts
- Guernsey foundations
- Investment funds
- Family offices
- Independent asset managers
- Captive insurance vehicles
- Guernsey companies
- High-net-worth individuals
It should be no surprise that prospective clients are typically after private bank accounts, wealth management, financing, and investment management.
Individuals looking for personal banking or day-to-day business banking, need to understand that their options in Guernsey are limited — though there are some options if you choose carefully.
Alternatively, opening an Isle of Man bank account or a Jersey bank account are two other options worth considering. Both islands offer similar benefits to Guernsey but are better suited to the needs of non-resident individuals.
Read more about banking in the Isle of Man and Jersey in our free articles:
- Isle of Man Offshore Bank Account Opening
- Jersey Bank Account Opening [Start Here]
What Financial Services Are Available in Guernsey?
Guernsey focuses on the needs of wealthy individuals, institutional investors, and wealth management entities. The types of services available in Guernsey include private banking, wealth management, custody, and other related services. We discuss each of these in detail below.
Private Bank Accounts in Guernsey
Today, private banking is a loaded term that covers a range of services, many of which vary widely from bank to bank and country to country.
Generally speaking, in the context of Guernsey, we are referring to traditional private banking provided to high net worth (HNWI) and ultra-high net worth individuals (UHNWI), and their wealth planning vehicles.
Such services include a range of financial services, lending, and more. This also includes being able to access wealth management as well as investment products and services, which we discuss below.
Trust & Fiduciary Services in Guernsey
Guernsey is best known for trusts. This little island is widely considered a leading and reputable jurisdiction for structuring and administrating trusts.
Guernsey was one of the first countries to regulate fiduciary trust services and while modern trust laws were adopted in the 1960s and 1970s, Guernsey trusts date back hundreds of years. Today, it’s reported that there are over 20,000 trusts in Guernsey — though no registry exists.
Not surprisingly, many of the international banks that operate here specialize in the administration of such trusts. This allows clients to unlock the benefits of estate and succession planning, asset protection, tax neutrality, and much more.
Custodian Services in Guernsey
Finally, custodian services are available from many banks in Guernsey. These services almost exclusively cater to the needs of institutional, financial, and corporate clients. Such services include the settlement of accounts, reporting requirements, dividend services, and more.
Non-Resident & Expat Bank Accounts in Guernsey
It’s possible to access certain non-resident and expat financial services. These services range from international bank accounts to international mortgages to acquiring properties in the UK. Bank selection, however, is critical as very few options exist. It’s important to make sure to scrutinize the services your chosen banks offer (along with the related fees) before opening an account.
What Are the Challenges of Opening International Accounts in Guernsey?
Like all offshore financial centers, banks in Guernsey each have their client preferences, areas of specialization, and different requirements for opening. This includes an emphasis on deposit requirements.
Even though there are a few brand-name international banks active on the island, your chances of opening an account without knowing which banks cater to your client profile, your investment needs, and actually want you as a client are extremely low.
Banks specializing in private banking and wealth management want to know where you fall in their wealth brackets. They also want to understand which specific services you intend to use. They specifically want to know how profitable you’ll be as a client for the relationship manager and the bank.
Banks in Guernsey, of course, have other non-financial considerations as well. Certain banks only accept clients from a small number of countries. Other banks require specific ties to certain regions or jurisdictions.
Challenges of Opening Accounts With Financial Institutions in Guernsey
Here’s an overview of the challenges applicants face when looking to open accounts in Guernsey.
- Finding banks that accept their client profile
- Finding banks that offer their required services
- Having sufficient ties to required jurisdictions
- High deposit and investment requirements for certain banks and client types
Unlocking the benefits of opening an account in Guernsey doesn’t have to be difficult. You need to have the right information and opening strategies, approach the right banks, and have the right banking contacts. Other jurisdictions, of course, are offering similar benefits that are significantly easier (and more beneficial) for you to access. This highly depends on the person applying.
Frequently Asked Guernsey Banking Questions
Below are a few of the most common questions we receive from people exploring Guernsey offshore banking. If you have further questions about international banking, don’t hesitate to contact us directly.
Can You Open a Bank Account in Guernsey?
Yes, you can open a bank account in Guernsey if you meet the bank’s opening requirements and have a suitable client profile. Financial institutions in Guernsey are suitable for non-resident individuals looking for priority and private banking services rather than everyday personal banking. The banks available to each prospective client depend on their citizenship, residency, and deposit level.
How Much Money Do You Need for an Offshore Bank Account?
The amount of money needed to open an offshore bank account depends on the type of account being opened, the desired country, the bank being considered, and the profile of the prospective client. Applicants need to expect to deposit anywhere between USD 10,000 and USD 500,000 to open an offshore bank account.
Can I Open a Bank Account in the Channel Islands as a Foreign Non-Resident?
Yes, you can open a bank account in the Channel Islands as a foreign non-resident. Both Jersey and Guernsey, which make up the Channel Islands, are home to banks that offer international financial services to non-resident individuals, including online banking. It’s important to note that not all banks in the Channel Islands are suitable for all client profiles. Bank selection is a critical factor when deciding where to apply for an account as anon-resident.
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