If you’re looking to relocate, then you will have a variety of options to consider with regard to banking. You can maintain your existing account, open up a local account, or create a savings account off-shore. The banking choice that’s right for you will depend upon your financial circumstances and how regularly you need to access your finances.If you move to Bermuda but continue to use your bank account from back home, you may incur significant transaction costs and fees. Opening a local bank account in Bermuda can be a great way to avoid this, especially since the country is well known for its tax neutrality and its willingness to work with people both inside and outside of the country.
As an expat, opening a bank account in Bermuda is very easy, so if it’s something you’ve been considering, then here’s what you need to know.
Choosing a bank to open an account with
In some countries, if you bank with a large international bank back home, you may be able to open an international account, but this is not possible in Bermuda, unless you bank with HSBC.
This is because foreign banks are unable to operate in Bermuda, and they have been unable to for decades. Instead, all banks must be tied to Bermuda’s local economy, which means that their headquarters must be based on the island, they must be (majority) owned and run by Bermudians, and they must be registered in Bermuda.
However, HSBC did manage to gain a presence on the island, by merging with the Bank of Bermuda, a local institution at the time. Now, HSBC is one of just a handful of banks that are allowed to operate within the country. Other banks include:
• Bermuda Commercial Bank
• Butterfield
• Clarian Bank
Because of the small offering in regards to banks that are available on the island, competition amongst them is fierce, which means that most of their products and services are fairly similar. However, service fees for accounts can vary, and so you’ll want to check whether the bank you’re looking at implements charges for the following:
• Transfers
• Withdrawals
• Transactions
• Account handling
• Admin (such as mailing documents or making photocopies etc.)
Because of the similarities in the ways banks operate, comparisons can be hard to make. But luckily, because there are only a few banks in Bermuda, you can compare third-party reviews or visit local branches to see which processes you gel with most.
Typical banking hours in Bermuda are between the hours of 9 am and 4 pm, and each bank offers numerous types of account. The most popular account categories are:
• Current accounts
• Savings accounts
• Checking accounts
• Corporate accounts
Which account type is right for you will depend upon what type of banking you’ll be using the account for. For typical, day-to-day expenses and paying for local transactions, a basic current account will suit your needs.
What do I need to open a bank account?
Once you’ve decided which bank and which type of account you want, you’ll need to compile some documents in order to actually open an account.
Accounts can be opened online, over the phone, or in-person. However, each bank will have set processes to follow. Some may require that you sign documents in person, so you may still need to visit a branch to complete the opening of your account.
To start with, you’ll be asked to complete an application form. This is something you must do regardless of which bank you choose, as it will provide the bank with enough information about you to verify your identity and to create an account in your name. The application process will ask you for:
• Your name
• Your address
• A contact number and email
• Personal identity and tax information
• Your employment and/or business information
• A specification of the services and/or products you want to utilise
• How you’d like your transactions to be handled
In addition to this, you will be asked for proof of identity, which will be verified before you can open the account. Accepted forms of identification include:
• Passport
• Birth certificate
• Proof of address
• Driver’s license
• Work permits, visa, and/or an employment letter
Once your paperwork is submitted, you’ll need to make a deposit into the bank account. The amount required will be unique to the bank you’ve signed up with and what type of account you own. As an example, for a personal account, you may be required to deposit around $5,000, while for a savings account, you may be required to deposit around $25,000.
Once the funds have been deposited, you’ll be able to make use of your account. For example, you’ll be able to make transactions, wire transfers or remote withdrawals. You’ll be able to find all of the information regarding your account type in your terms and conditions.
Is there anything else I need to be aware of?
It’s important that you familiarise yourself with the laws involved when opening a bank account in Bermuda. The laws that are applicable to you will depend upon your nationality and the agreement between Bermuda and your home country. For people in some countries, opening a bank account in Bermuda may actually be illegal.
If you live outside of Bermuda, you will need to keep careful records and track your income and banking activity – you don’t want to accidentally break any laws by not declaring any income in your Bermudan bank account. The Internal Revenue Service in the United States can charge you if they suspect you’re hiding money off-shore in a Bermudan account.