Private bank accounts

Private banking is a set of financial and banking services typically offered to wealthy clients — also known as high-net-worth individuals — by a bank or other financial institution. In contrast to a usual checking account, a private bank account is traditionally opened with the expectation that the bank will manage the money for you. This means that private banking departments usually want to see only a minimal number of transactions coming in and out of your account — this is not the account for receiving salary payments, paying bills or taking business drawings. However, it would be the right place to keep your family wealth, proceedings from a sale of a business or other funds that you are not planning to spend in the immediate future.

If you are looking for a secure and prestigious bank for wealth management or other private banking services, the Confidus team can help you find the most efficient solution to fit all your needs.

Opening a private bank account When discussing the key differences between a private bank account and other types of accounts, it is important to point out the additional requirements and the general procedure of opening an account with a private bank. The main requirement for opening a private bank account is a significant amount of funds — while the lowest minimum deposit is around 250 000 USD, some banks will demand 5 000 000 USD in deposits before you can open a private bank account.

Opening a private bank account requires a certain amount of paperwork and there will be a procedure to go through. While the main condition for opening a private bank account is being able to deposit a certain amount of cash, there are cases when applicants are denied a private bank account for other reasons. Every year, approximately 5% of applications are turned down due to suspected fraud or illegal activities. In order to avoid accepting funds generated by gun or drug trafficking or other illegal activities, private banks go through strict risk and compliance procedures, required by regulatory bodies, to verify the potential client’s identity and the source of the funds. The beneficiary of the funds must also be identified.

briefcase with money stacks Documents required for opening a private bank account Requirements for opening a private bank account can vary slightly from bank to bank, especially in terms of the size of the required deposit. However, there are several documents that you will very likely be asked to provide by any private bank. Due to strict regulations and international agreements, banks are required to perform thorough KYC (“know your client”) and other compliance procedures, not only before accepting the potential client but throughout their relationship with him or her.

The first document you will need to provide is your passport — this is the main proof of your identity. In addition, since private bank accounts are only available to those aged at least 18, your passport will also confirm your age.

Furthermore, you will need to prepare a document verifying your official address. Often, the proof of residence must be less than three months old.

You will very probably be asked for documents that demonstrate the legitimacy of the source of your funds (such as financial statements, inheritance documents or documents proving a sale of a business or real estate) in addition to documents proving your economic background. So that the bank can be as certain as possible about the legitimacy of the funds to be deposited in the account, they may ask for identification documents for any beneficiaries of the account as well.

Interestingly, the final decision on whether or not to approve an application to open a private bank account is not in the hands of a private banker — committee meetings are held specifically for this purpose and the personal manager is the person who represents the potential client. The main reason for this is to ensure that the decision makers have no relationship with the client, and therefore have no potential personal interest in accepting a questionable application.

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Last-modified: 2021-09-19 (日) 19:44:04 (289d)