Combining a Panama IBC with a bank account locally is a common structure that foreigners consider when seeking offshore structuring solutions.
But, while the Panama IBC is a very popular structure, it isn’t the best choice in all situations.
In fact, a Panama IBC can face considerable challenges when looking to open business bank accounts in Panama and abroad.
In this article, we’re going to share important insights about the Panama IBC, and we will also discuss the key banking details you should consider before registering one.
This article is part of our free series on Business Banking in Panama. You can access this series right now by using the link above.
In addition to detailed account opening guides, this free series on Panama banking also discusses the largest banks in Panama, Panama opening requirements, the costs of banking in Panama, and much more. Use the link above to start exploring all of your free Panama banking content right now.
Alternatively, use the table of contents to continue exploring Panama IBCs and the banking options they can access.
Table of Contents
- Panama IBC and Bank Account
- Who Can Register a Panama IBC?
- Where Can a Panama IBC Open Bank Accounts?
- Frequently Asked Panama Banking Questions
- Do You Want to Open Panama Bank Accounts?
Panama IBC and Bank Account
Panama IBC and bank account combinations are becoming less frequently used by foreign non-residents due to increasing scrutiny and bank account opening difficulties. Instead, the Panama IBC is more commonly used for holding assets such as real estate, maritime vessels, and intellectual property.
In short, the Panama IBC (and Panama more broadly) is still being negatively impacted by the reputation damage that resulted from the Panama Papers. That said, we don’t agree with the broad generalizations directed at Panama and instead view the country as an accessible and stable banking jurisdiction.
That said, Panama IBCs still have an uphill battle. Unfortunately, due to Panama’s inclusion on watchlists managed by The Financial Action Task Force (FATF), the European Union, and the United Kingdom, Panama IBCs are limited in their ability to open bank accounts abroad.
With this in mind, before registering a Panama IBC it’s important to consider your business needs and your banking and payment processing requirements. In doing so, you may find that a Panama IBC is unable to meet your goals and is therefore not a suitable option for you to consider.
Alternatively, if you are a resident of Panama with existing banking relationships in the country, you might find that a Panama IBC perfectly matches your needs. In that case, there are a wide range of lawyers and service providers to choose from that will be able to help you set up your company.
Who Can Register a Panama IBC?
Any legal person can register a Panama IBC. That said, while a single shareholder can register an IBC in Panama, three directors are required. The three directors then elect the officers of the Panama IBC, including the President, Secretary, and Treasurer. In most cases, the three board members each act as one of the officers of the entity.
The names of the directors and officers are public records, recorded with the Public Registry of Panama. For this reason, many shareholders will elect to use nominee services, which most legal firms in Panama offer.
Where Can a Panama IBC Open Bank Accounts?
As mentioned, Panama IBCs will struggle to open bank accounts outside of Panama. That said, somewhat surprisingly, they will also struggle to open bank accounts locally in Panama. With this in mind, it’s important to confirm your banking requirements and consider whether your Panama IBC will be able to fulfill these requirements prior to registration.
In certain instances, Panama IBCs will be able to open bank accounts in foreign banking jurisdictions. However, in most cases, the banks that are willing to consider Panama IBCs will ask for high account opening deposits. Additionally, when opening abroad, Panama IBCs are typically used exclusively for wealth management purposes and do not engage in any operating activities.
As for opening in Panama, a Panama IBC will need to provide all of the supporting documentation, have a clear rationale for opening accounts, make a qualifying deposit, and in many instances have a direct introduction to the bank.
If you are interested in exploring business banking options in Panama further, don’t forget to visit our comprehensive guide on Banking in Panama, available in the link above.
Alternatively, if you would like to explore all of your offshore banking options, download our free guide and compare Panama to some of the top banking jurisdictions available.
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Frequently Asked Panama Banking Questions
Below are a few of the most common questions we receive from people exploring banking in Panama. If you have further questions about Panama, don’t hesitate to contact us directly.
What Is a Panama IBC?
A Panama IBC refers to a Panama company that does not engage in business activities within the Republic of Panama. The International Business Company (IBC) was first established in Panama on February 26, 1927, under Law 32.
Can a Foreigner Open a Bank Account in Panama?
Yes, a foreigner can open a bank account in Panama, including remotely for both individual and business purposes. That said, very few banks in Panama accept foreign non-residents, and even fewer accept remote applications. For this reason, bank selection is critical in the process of successfully opening bank accounts in the country.
Can Americans Open Bank Accounts in Panama?
Yes, Americans can successfully open bank accounts in Panama. This includes opening accounts as a temporary or permanent resident of Panama as well as opening accounts as a non-resident.
Why Do People Have Offshore Accounts in Panama?
Panama is an attractive destination for opening offshore bank accounts because it is accessible to foreign non-residents, account opening deposits are low, and remote account opening is possible.
Do You Want to Open a Panama Bank Account?
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