There is still a great deal of concern at the moment regarding the safety of banks. So how can you protect yourself? Whilst many governments have increased their deposit protection schemes to more realistic levels, no one has any idea how long it will take to be compensated if a bank defaults. It is likely to take several months but it could also be years before you have access to your money again.
The sensible approach is spread your money amongst several banks. The amount of deposit with each bank should not exceed the compensation limit (normally double for joint accounts) in the jurisdiction of the bank’s domicile. The main problem with this is the aggravation and time it takes to open a number of accounts with different banks. Then there is the problem of going through the rigmarole again each time one of the banks becomes uncompetitive.
It is possible to overcome these problems by using an offshore structure that will allow you to hold several different bank accounts under one umbrella. There is only one application to complete and the provider then opens the requested accounts with the various banks. If a bank becomes uncompetitive, a simple faxed instruction is all that is required to close the account and open another. Not only that, the interest earned is not subject to withholding tax under the European Union Savings Tax Directive or the Contribution for Defence in Cyprus.
Other investments can also be held making this an administratively simple and safe home for your money.
If you would like to know more, please contact
Mark O’Shea Cert PFS, TEP, Alexander Beard Group, Limassol,
Tel: 25348888 or 9926 8073, Email: mvo@abg-int.com or
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