Foreigners who open Cypriot structures with Cyprus bank accounts will benefit from an incredible variety of banking possibilities in Cyprus. More and more multinationals and Family offices are using Cyprus as a base for their operations and Cyprus banks are welcoming to foreign business. 

Cyprus banks offer multi-currency accounts and many other features. Some banks even take applications without the need for visiting their offices (you can get more info from our experts). Therefore, having a company and bank account in Cyprus should be part of your diversification strategy.

We are happy to announce that Mundo has partnered with some of the most recognized experts in corporate and banking solutions in Cyprus. We are offering a unique possibility through them. 

Our Cyprus package consists of the establishment of a corporate structure + opening a corporate bank account in Cyprus for a preferential rate.

Why should you open a bank account for your business in Cyprus?

• One of the lowest corporate tax rates in the European Union

• Access to over 60 double taxation treaties

• Solid regulatory environment

• Compliance with international substance requirements

• Full access to the European market

• Favorable financial environment

• Reliable Limited Liability Company (LLC) and holding legislation

• Open corporate and personal bank accounts remotely 

• Affordable maintenance fees

• Protection of deposits

• Opening a bank account remotely takes less than three weeks

Why has banking surged in Cyprus? 

Banking has seen a fantastic surge in the last few years following the 2013 financial crisis. The government has promoted a series of initiatives and reforms that helped private investment and gave confidence to the markets that Cyprus could have a booming banking sector. The overall economy has a sustained 4 % growth per year, credit rating improves per year, and banks are raising private capital and maintaining strong capital positions.

Likewise, non-performing loans have been cut in half, and fresh foreign investment has improved the banking sector, which has become one of the most dynamic industries in the country. The banking business is booming in Cyprus, that’s why we work with the top experts in the country so you can reap all the possible benefits.

Six years ago, the country and the Bank of Cyprus seemed to be walking to the abyss. The largest bank of the country was struck by the European debt crisis, which led several Cypriot banks to bankruptcy, including the second-largest bank in the country, the Cyprus Popular Bank. The economy was bailed out by the troika (the European Commission, ECB, and IMF) with a loan of 70 % of the GDP of Cyprus, with the condition that the country started an austerity program. The crisis worsened to the point that the Bank of Cyprus seized deposits from its clients to stay afloat and avoid total collapse.

Why did it happen? First, Cypriot banks made the unwise decision to lend money to Greece. When the Greek economy collapsed, Cypriot banks made the even worse decisions to buy Greek government bonds expecting a bailout. After the Greek economy continued in a nosedive, the consequences where foreseeable: The banks collapsed and got to the point that they owed more money than Cyprus GDP.

The country asked for a bailout, but the troika wasn’t so eager to do it. So, what was the solution? To literally take the money from people’s account imposing a 6 to 10 % tax on savings accounts to pay the debt. Fearing that the government was going to grab their money, Cypriots ran to the banks to take their money away from them and the government-imposed restrictions on the amount of cash they could withdraw. Eventually, the plan of imposing a tax over saving accounts was thrown away, and the bailout happened.

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Fortunately, the government soon corrected the direction the country was heading and most of the debts of the emergency loans were paid. The government has applied plenty of pro-business reforms that have led to a resurge in the banking sector. Banks have regained investors’ trust, meaning they are starting to diversify their offer.

Banking products in Cyprus

Banks are introducing new products and services for companies, individuals, start-ups, and ventures with a ton of potential, and are expanding their services to the main economic sectors of the country: shipping, tourism, real estate, and professional services. All the leading Cypriot banks have passed the ECB stress tests and are moving towards sustainable, yet exponential development, thanks to the shedding of NPLs.

The pro-business reforms promoted in the last few years have given banks more ways to reduce the burden of difficult assets and their economic imbalances, as they are sequels left by the crisis. Several laws passed in 2018 strengthened the banking sector flexibility to deal with the legacy of the crisis, allowing them to securitize loans and speeding loan recovery rates, which accelerated the drop in NPLs in Cyprus, which is by far, the fastest in the EU. All this has improved liquidity and solvency in the banking system, which has reduced risk and increased net loan demand, further dynamizing the economic activity in the country.

The banking sector of the country is made up of two kinds: domestic banks and international banks. International banks have been attracted to Cyprus for its friendly fiscal regime and to use the island as a base for other emerging markets. The fact that the BCE regulates the banking sector, and in full accordance with EU directives also helps. There are more than thirty foreign banks in Cyprus. Most of them have limited interaction with the national economy.

Aside from the traditional services of deposit and lending to individuals, corporations, and SMEs, Cypriot banks operate under the universal banking model. That means they provide a wide array of products and services. Still, customer deposits are the primary source of income for banks in the country. The main players in the Cyprus banking world are the Bank of Cyprus, the Hellenic Bank, and the RCB Bank. The rest of the market are smaller banks and foreign subsidiaries such as Greek Eurobank.

In the last few years, the banking sector has attracted a significant amount of FDI. Brexit has had a positive impact over Cyprus as some UK-based companies look at Cyprus as an alternative operational location in the EU. What are some banking investment opportunities in Cyprus? There are plenty of them:

• Distressed assets

• Loan portfolios

• Mergers and acquisitions

• Private equity and venture capital opportunities

• Financing large infrastructure projects

Requirements to open a bank account in Cyprus

Requirements vary, but in general they keep a standard that only change in a couple of documents or forms. 

For individuals, there are three types of accounts: deposit, checking, and savings accounts. Requirements are mainly five:

• Passport copy

• Proof of residence

• CV

• Source of wealth

• Bank reference

Generally, there is no minimum deposit nor minimum balance for personal accounts.

For a corporate account, the main requirement is having substantive presence, which can be demonstrated by having a small office, for example.

There are four types of corporate accounts: fixed deposit, checking, commercial, and savings. These are the requirements:

From the shareholders:

• Notarized copy of the passport

From the directors:

• Notarized copy of the passport

• Bank reference letter 

From the beneficiary owners and authorized signatories:

• Notarized copy of the passport

• Proof of residence

• CV

• Bank reference letter 

• Business card

Corporate documents

Notarized copy of:

• Certificate of incorporation.

• Memorandum of rules, by-laws, and operating agreement.

• Certificate of good standing (if the company is more than one year old)

• Certificate of directors, shareholders, registered office and secretary

• Minutes assigning the official directors.

• All minutes of the Board.

• Power of attorney, if applicable

• Trust deed, if there is a nominee shareholder 

• Brief description of the business plan

• Contracts, agreements with partners, invoices, brochures, presentations, and similar documents.

Structure that leads to the ultimate beneficiary 

• Recent financial statements/account management or bank statements.

Who are we and what can we do for you?

In Mundo, we believe in freedom. That means we aim to protect your investments and your assets. In a time when it seems that governments actively seek to persecute the income of high-net-worth individuals, it is an obligation to seek ways to legitimately optimize your taxes.

Mundo experts help high-net-worth individuals to optimize their taxes all over the world so they can secure their business and reinvest their money freely.

In all these years, we’ve assembled an unparalleled network of experts to provide the best possible services with top-notch expertise for our clients.

That’s the reason why we work with one of the top financial services provider in Cyprus, with a multidisciplinary team that covers all aspects of the corporate world.

Banking in Cyprus offers incredible opportunities, but choosing the best for you may be tough, especially if you want to seek the best tax optimization possible. Our experts work with a network of offshore and onshore banks to aid their clients in opening and closing bank accounts, due diligence issues, setting up and managing their accounts, and more.

Want to know more? Contact us and ask for a consultation!

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