Whether you’re looking for private banking, business banking, wealth management, or simply interested in diversifying your savings, opening a bank account in Austria could be worth exploring.
In fact, this landlocked alpine nation in central Europe has a long history providing tight-lipped banking services to European elites, secretive wealth management structures, and strong private banks.
Today, Austria is favored by Europeans from neighboring countries, Russia, and a few other CIS member states. And, that makes sense given Austria’s close proximity to Eastern Europe, the fact it shares a border with Hungary and the Czech Republic, and Vienna is a short 2.5-hour flight from Moscow.
But, anyone looking for non-resident banking in Europe who can stomach the fees and has a decent sum of money can consider Austria too. While some of Austria’s larger universal banks don’t have the greatest financials, some of its smaller private banks have strong balance sheets and are worth considering.
In this article, we’ll discuss the available banking options in Austria, which types of people and companies are best suited to bank here, the benefits, and how you can get started opening accounts.
Before diving in, if this is your first time visiting GlobalBanks, don’t forget to download your FREE copy of our Non-Resident Banking Starter Guide. It’s the perfect starting point when opening accounts in international banking hubs like Austria.
Like all banking jurisdictions, opening a bank account in Austria isn’t for everyone. Depending on your goals, the banking services you need, the amount you’re looking to deposit, and even where you’re from, there might be better options elsewhere.
So, at the end of this article, we’ll also share a few alternative jurisdictions for you to consider that have similar attributes. This way, you can get a taste of what else is out there, so you can make the best choice based on your banking needs.
For decades, Austria was famous for banking secrecy and many considered it a tax haven. On top of that, the country was politically stable, in the EU, had attractive estate planning structures, and it didn’t have any inheritance or wealth taxes.
Plus, Austrian banking secrecy was literally written into the country’s constitution. And, many non-residents liked that it was a cash society and privacy was a virtue embedded into the hearts and minds of people (and bankers) that live here.
For years, the Austrians took their banking secrecy really seriously. Austria also saw how the Swiss were cashing in on banking secrecy and wanted in on the action. So, Austria took the concept of an anonymous bank account to an entirely new level, creating the (now infamous) Austrian Sparbuch bank account. But we’ll get into that more later…
The point is, Austrian banking has a long history of attracting non-residents. But, the private banking industry here is much more low profile than, say, Switzerland. This is because Austrian private banking has traditionally been dominated by domestic players, not big international names. So, you won’t see Austrian private banks with offices and subsidiaries scattered all over the globe.
Also, keep in mind that thanks to new and stricter banking regulations, banking secrecy is a thing of the past. In fact, Austria now has a beneficial ownership registry. This registry lists Austrian and foreign UBOs of Austria Treuhand arrangements–more on these below.
Here are a few reasons why someone might choose Austria over other jurisdictions.
If you’re from Russia, the CIS, Central or Eastern Europe, or a country prone to civil unrest, exchange controls, shaky banks, or corruption–Austria is a safe haven for you. Certain Austrian banks may be safer than in your home country. Austrian bankers won’t steal your money, fiscally-responsible Austrian banks won’t implode overnight, and there is rule of law. So, this makes Austrian banking attractive to some people.
Certain Austrian banks accept non-residents and foreign companies. So, for those who are having difficulty opening accounts elsewhere in Europe, Austria could be a nice backup option.
First, Austria is one of the few quasi-respectable countries that offers private foundations. Introduced in 1993, an Austrian Privatstiftung (Private Foundation) is an asset protection and estate planning structure like those available in Liechtenstein and Panama.
Secondly, Austria offers Treuhand accounts, which are essentially an Austrian trust managed by a custodian. Treuhands are governed by civil contracts, are not regulated in law, and are based on the autonomy of the contracting parties.
Combining such structures with Austria’s zero wealth tax, zero inheritance tax, and an abundance of double tax agreements (DTAs) to reduce withholding taxes on royalties, interest, and dividends, is another reason why Austria is a favored jurisdiction for some groups.
Of course, it doesn’t hurt that Austria offers political and economic stability. Being a member of the European Union, it doesn’t have the stigma of an offshore jurisdiction. And, when you’re doing business, the reputation (and risk-level) associated with your banking jurisdiction is important.
That said, if you’re not interested in Austrian structures or investing in the Austrian stock market, then you may want to bank elsewhere.
Remember: If you’re able to meet the opening requirements of private banks in Austria, you’ll probably be able to meet the requirements of banks elsewhere, possibly in even more prestigious jurisdictions as well.
With this in mind, let’s look at who might want to consider opening a bank account in Austria.
Given the availability of stronger banking hubs with similar account opening requirements, it’s fair to say that the banking clients best suited to Austria are those interested in investing in Austria directly, doing business there, or looking to set up an Austrian structure.
If you already have an Austrian Privatstiftung or Treuhand, it makes sense that you would look at opening a bank account in Austria. Austrian banks understand these structures. And they know how to conduct due diligence on them without getting frazzled. So naturally, they’re comfortable onboarding them as new clients. This is especially true for Austrian private banks.
In fact, if you try to open accounts with these structures in non-European banking hubs, you may struggle to find bankers that have even heard about them before.
If you’re considering an Austrian Privatstiftung or Treuhand for your asset protection or estate planning needs, it’s always good to consider what banking options are available for that structure before setting it up. This is true regardless of whether you are considering a foundation in Austria, Liechtenstein, Panama, or even Liberia (yes, they exist–don’t use them).
With this in mind, if you are considering an Austrian Privatstiftung or Treuhand, be sure to speak with a qualified advisor. They should understand the specifics of your situation and any relevant DTAs before making a decision.
If you’re looking to invest in the Vienna Stock Exchange, then opening a bank account in Austria can reduce transfer fees, exchange fees, and give you access to supplementary research and trading resources. That said, most clients can access the same securities using Interactive Brokers and similar online trading platforms.
If you do decide to open a bank account for the purpose of trading Austrian securities, make sure you confirm the fees that will be charged by the bank before opening accounts. This can vary widely and is often negotiable.
On the other hand, if your reason for opening a bank account in Austria is to invest in Austrian real estate, then a local bank will likely be required. In most cases, non-residents looking to acquire Austrian real estate will tend to use structures in order to reduce personal liabilities and provide for easy transfers in the future. And, Treuhand’s serve as a common structure for these transactions.
Of course, if you have a business that is operating in Austria, has suppliers in Austria, or has customers in Austria, opening a bank account in Austria might also make sense. This is also true if you have operations in surrounding countries and prefer to bank in a more stable jurisdiction.
For instance, it’s not uncommon for Central and Eastern European companies to set up joint ventures or have business relationships in Austria, and then bank from Vienna.
Like other European banking hubs, Austria offers a personalized approach to private banking and wealth management. Additionally, certain banks here are very in-tune to the needs of non-residents. And, some even cater to clients from Russia, CIS, and Central and Eastern Europe (CEE). If that’s you, Austria could certainly be a jurisdiction to consider.
However, before rushing to open accounts in Austria, do your homework. You need to carefully examine the bank’s financials and check for red-flags. Some Austrian banks have notoriously poor financials. Other banks take on high-risk clientele that make them vulnerable to massive compliance failures, scandals, and prone to failure. . Likewise, it’s good to shop around and consider fee structures and which banks offer the particular banking services you need. After all, while Austria does have several excellent banks, not all banks are created equal. And some can get quite pricey.
Austria is one of many European banking jurisdictions that cater to non-residents seeking personalized attention and services. With this in mind, it’s important to consider the other alternatives before opening a bank account in Austria.
So, here are a few other options:
If you’re looking for private banking and wealth management, it’s hard to beat Switzerland. Depending on the type of account you’re looking to open in Austria, it’s possible that your minimum deposit will be sufficient to open accounts with top Swiss banks as well.
If you’re attracted to Austria for Privatstiftung or Treuhands, you may want to consider Liechtenstein instead. After all, Liechtenstein offers similar structures and advantages while also offering a wider range of private banks that cater to non-residents.
If your preferred investment is real estate and you’re looking for secure investments, favorable financing, and sought after real estate, Monaco could be worth considering. Additionally, many private banks in Monaco will offer creative financing. This is especially true for property. Although this can sometimes be limited to the French Riviera and surrounding areas.
Needless to say, this is just a small (and very simplistic) taste of the many options that are available to you in the world of private banking, wealth management, and structuring. And of course, opening a bank account in Austria is certainly one of the options that you should consider.
But, if you are interested in finding out which specific jurisdictions, banks, and bankers are best suited for your personal banking objectives, then we’d be happy to help you get started.
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