It is a rarity that something like this lands upon my desk as offshore bank licenses are not at all easy to get in 2022. Regardless, I have been contacted by a party with an Offshore Bank License for Sale. In fact, it’s not simply just the license but it’s actually an operating financial institution.
The bank in question has account holders, swift, and USD correspondent facilities with full digital banking tech setup. It is located in a Caribbean jurisdiction and has an unrestricted offshore banking license. It also has an operating office in the jurisdiction, along with key staff, and secure servers.
What Does an Offshore Bank License for Sale Cost?
Operative Offshore Bank Licenses can cost anywhere from 350k to millions depending on the size of the institution, profit levels, and whether it is simply a shell or an operating bank. At this stage, I can’t really give you the full list price as due diligence and confidentiality agreements would need to be executed first.
Ultimately, any sale is likely to be via negotiation, and if you were looking to spend in the range of US$1 – $4 million you may be falling within the ballpark. Apologies for being indirect, but the reality is that this is a known banking entity within the offshore world.
What is the Sale Process
There are some key steps as part of the due diligence and sales process that you should be aware of before making contact with me and the client. You will first need to execute a non-disclosure agreement and provide proof of funding (normally this is a letter of comfort from your bank or a bank statement).
At this point, I will be able to provide you with a full sales document including the current financials, bank license details, key staff details, and a breakdown of their current reasons for selling along. We can then discuss the listed price and negotiate if you would like to move forward. Obviously, if you did wish to move ahead, I would recommend you retain your own solicitor to review all documents.
A letter of intent and a sales agreement, with escrow, would then be entered into and the full due diligence process would commence for both parties.
Why is Due Diligence Required
This is a protection for both parties in that the buyer gets to assess the bank, and its present financial state, including any contingent liabilities, and the Bank gets to assess the buyer. In particular, the vendor needs to be assured that you are an appropriate person and will pass the various licensing checks by the regulator.
Otherwise, there isn’t much point moving ahead with any sale that is likely to founder on a problem with the buyer!
At a minimum, you can expect to have to provide:
- Notarized Proof of Identity
- Notarized Proof of Address
- Proof of Funds
- Full CV and Background
- Criminal Records Check
- Adverse Professional Records Check
Can You Give Me Further Details?
As mentioned, a non-disclosure agreement would need to be signed before I can give out details on just which specific offshore bank, and license jurisdiction it is. This protects both parties given the spotlight on the offshore finance sector of late.
Key Points for the Offshore Bank License for Sale
However, I can generally state the following:
- Bank is licensed in a reputable Caribbean location
- 3 of the current professional board members are happy to stay on if needed
- You would need personal funds in the range of US $1mio to $3mio range
- The bank is trading and has depositors
- There is a complete digital banking solution in place
- There are staff in place for the required key roles by the regulator
If you require any further information, then it would probably be advisable to contact me and discuss your background and funding and what you are looking to achieve.
Dave Wright
Steven James
