Bank Introduction and Bank Accounts

In most cases, it is not necessary to visit a country in which you wish to open an account or carry out any banking activities. It should be noted that modern day banking is developing under the examination of the regulators and international bodies, involved in the prevention of money laundering, terrorist financing and tax evasion. All banks value their reputation and endeavour to carry out their operations within the jurisdictional law. They have no desire in conducting business with unknown shady organizations, and give priority to creditworthy recommended entities that are in possession of the necessary documentation and financial potential.

In most projects, in order to use the company, a current or/and investment account is required. Selecting the right bank is an important step for your project. There are many banks in Cyprus that have obtained a retail license. Our company cooperates with various financial institutions, with which, over the years, we have established a strong and trustworthy relationship.

During the bank selection process, it is important to take into consideration the following:

• Bank ratings

  Bank's rating and reliability are both among the most important points to consider. One of the factors that indicate the bank's high rating, is the amount of the client’s funds that is under the administration of the financial institution. The bank's rating in the country or worldwide can be obtained in the Bankers Almanac. This information is updated every year and is based on statistics collected by different institutions of the regulating country.

• Bank's specialization and offered services

  It is advisable to determine what is the expertise of the chosen bank. For some projects it is important to know whether the chosen bank provides the required services in the sector of your company’s specialization. Some banks specialize on specific services as they focus on certain operations, e.g. shipping, wholesale, oil trade, small scale businesses etc.

• Bank's fees and tariffs

  When analyzing the bank's tariffs, checking the bank's commission that will be implemented is essential. It is recommended to analyze the overall commission rates in order to define what will be crucial for your business and what can be considered not applicable for your business needs.

  Here is the list of what we advise to consider when analyzing the commission rates:

  • Bank account opening fees
  • Monthly/Quarterly/Annual commission rates for maintaining a bank account
  • Fees incurred for internal payments between the bank's clients
  • Rates for opening an additional account or an account of a different type (Investment, card, savings accounts)
  • Internet-banking charges
  • Bank currency exchange rates
  • Rates on the currency that will be used by you
  • The account maintenance fee and how it depends from the amounts of transactions and/or amounts of funds held in the account
  • EUR transactions handling through SEPA system availability (for EU banks)

• Ways of controlling your bank account

  Considering your account is controlled remotely, it is important to pay attention to different ways of such account management, e.g. internet banking, control over your account through fax, authentication devices. Upon discussing the provision of Internet Banking, clarify what type of access is provided by the bank (View Only or Full Access).

• Requirements for the Initial Deposit, Turnover and Account's Minimum Balance

  When opening a new account, local banks require an initial deposit of 300 to 1000 Euros in order to activate the account. In the case where the client fails to deposit the initial funds within 3-6 months, the bank may close the account without any prior notice.

  We advise to clarify the bank's requirements regarding minimal turnovers and balances on the account. Bank maintenance fees may vary on the remaining balance of the account.

General bank requirements for opening a corporate bank account

• Completion of the bank forms
• Provision of a set of documents for the director, secretary, shareholder, account signatory and ultimate beneficial owner. This set of documents usually consists of a certified copy of the passport, a bank recommendation letter, CV, and a proof of address (utility bill) dated not older than 3 months
• Provision of a corporate set of certified documents

  The List usually consists of:

  • Certificate of Incorporation
  • Memorandum and Articles of Association
  • Certificate of Directors and Shareholders
  • Certificate of Registered Office
  • Appointment of Director
  • Minutes of the First Meeting
  • Declaration of Trust (if nominee shareholder)
  • Certificate of Good Standing or Certificate of Incumbency (If the company is 9 months or older)
  
  

  All of the above is true for the director or the shareholder being a legal entity. The documents of the shareholder (if a legal entity) must reveal who is the ultimate beneficial owner of the company. The list of the required documents may vary, depending on the bank or jurisdiction.