I guess I should begin this by saying that this post is probably not going to be at all helpful if you are looking for an offshore bank for an offshore company. This is simply offering an insight into what banking is like in developing countries.

When in Ghana

An unrelated venture on behalf of a client in the shipping business had suddenly taken me to Accra, Ghana, with about a week to spare before I was due to leave the country.

Ghana is an interesting country when it comes to banking, being one of the more advanced in Africa. The fine people of Barclays tried to enact a fully-fledged offshore banking legislation in the country, but the government backed out in the last minute, after massive criticism from OECD, the African Union and other international bodies. In the end, Barclays was the sole bank licensed under the offshore banking regulation.

With or without this legislation, money laundering was already a problem in Ghana. This is one of those parts of the world where you can still walk into a bank with a suitcase of money or precious metals and deposit it without any uncomfortable questions. Not because the banks encourage money laundering, but simply because this is a cash-based economy.

I received an email with a request from a client to open bank accounts somewhere in continental Africa (i.e., not Mauritius or Seychelles) for some newly formed legal entities, whose purpose is to either trade or invest in Africa and which need banking for cash pooling and local investments. Since getting into Ghana can be quite a hassle, with almost no nationals being granted visas on arrival and instead requiring a fairly long visa application process before travelling to the country, this was a golden opportunity.

I told my client to courier the company documents to my hotel and send me scanned copies by email, while I started making calls to banks. Since I know my client prefers to work with local or regional banks (as opposed to large international banks), I narrowed the choices down to a handful of banks.

Most banks were eager to take on a foreign client but many were lacking in features or functionality. After phone calls to every bank in Ghana (it’s not a very long list, especially if you remove international banks) and consulting with a local contact, I had narrowed the choice down to two banks: one of the nation’s largest banks and a smaller niche bank.

When I called the big bank, the person I spoke to on the phone said that they would be happy to open the account with scanned copies only but it would not become fully operational (no outgoing wire transfers) until hard copies of legalized documents arrived. It’s always a bit more fiddly to deal in countries that aren’t signatories to the 1961 Hague Convention.

The smaller bank was, as is common when smaller banks in developing countries are contacted by foreign investors, extremely willing to accommodate and made it clear that the account could be opened with far less stringent controls than the big bank. I dismissed the small bank.

After a few days, I received the documents from my client and headed to a branch where I had set up a meeting. The account opening itself was straight-forward. Ghana is an English speaking country but the accent can be a bit difficult at first. The people at the bank spoke almost perfect Queen’s English, though.

I inquired about remote account opening and was told that it’s possible but something they usually only do for high-networth natural persons, or persons (legal or natural) looking to invest in the local economy. The central bank  frowns on remote account opening for other purposes. It’s well aware of the petty money laundering going on and do not want to see it grow into a large international problem.

“Can you please go to Ivory Coast as well?”

It was nearing the end of my stay in Ghana when the same client as earlier contacted me and asked if I could pop over to Ivory Coast and open a bank account there as well.

At the time, almost every country had issued travel warnings to Ivory Coast and getting in, I was told, can be quite difficult. Parts of the country were in a state of upheaval.

In reality, my visit to Ivory Coast was a pleasant if intense one. It was easy to get a visa from the SNEDAI office at the Ivorian embassy in in Accra. All in all, the process cost about 150 EUR. Some cash, some bank, some card.

Once on Ivorian soil, I started researching the Ivorian banks and establishing contacts. I didn’t have a lot of time so I had to narrow it down from 24 to only a handful of banks quickly.

While it in Ghana was easy to find banks that opened accounts in USD, GBP, EUR, and other international currencies, Ivorian banks proved a lot less internationally-minded. Not a single bank here seemed to offer internet banking and regular customer service in English. Most banks also seemed to limit themselves to local companies and persons.

After confirming if my client was happy with potentially having to work with French-speaking customer service, I proceeded to book appointments with three banks: Banque Internationale pour l’Afrique Occidentale (BIAO), Banque Nationale d’Investissement (BNI), and Société Générale de Banques en Côte d’Ivoire (SGBCI).

First up was SGBCI. Soc Gen tends to be a good bank wherever they are located. This was no different except for the hurdles they were insisting on in order to make full use of the bank’s services, including forming a local holding/shell company. I left the bank with the branch manager’s business card in my pocket, because this is a bank I likely will return to in the future but it wasn’t the right bank for this client.

Next was BNI. Government-run investment banks in developing countries are usually open to foreign persons of any kind (legal or natural), as long as most of the money stays in the country and is invested locally. Since this was my client’s intention, I was able to get a good start with BNI.

Lastly, I went to BIAO. This bank was a lot like Soc Gen, less the international reputation of a major bank. Of the three, they were the bank that seemed to be able to offer the best multi-currency solution but in the end I had to rule them out.

So back to BNI I went.

It was agreed with the bank that an initial deposit of a few million XOF (CFA), of which a portion must be invested in the local economy (effectively meaning term deposits), would be made in order to open an account for a non-resident company and issue Visa Gold cards for some of the directors. The due diligence process was quite thorough. A telephone interview with at least two directors from each legal entity was required.

BNI was great to deal with and they were even able to assign my client an English-speaking account manager.

However, it is important to keep in mind that banking in Ivory Coast has a history of being risky. The country is quite unstable, both financially and politically.

Caveat: Parts of this post had to be re-written quite some time after the events took place after some of the original text was lost.

What about banking secrecy?

This is difficult to answer. While there is some literature on the situation in Ghana, Ivory Coast remains (probably) untested.

Both countries have legislation in place that should allow for EOI but whether such legislation actually works, doesn’t contravene other legislation, and is enforced remains unknown. There have been individual cases of information being exchanged but it’s always very difficult to gauge the compliance of relatively poor nations with rampant corruption and political instability, especially Ivory Coast.

These are not reputable jurisdictions, but for banking in the region, Ghana nonetheless remains one of the few decent options on the African west coast.

Follow Up

This post was written quite some time ago. I decided to push back publishing date to let my clients get used to the bank and provide feedback.

The conclusion seems to be that the Ghanian bank is the one they prefer working with for its English website and customer service. The bank has very a very capable remote banking facility.

They have less day-to-day interaction with the Ivorian bank since its purpose is just to store funds. There have been some problems using the cards, relating to the transaction limits being lower than promised and problems when withdrawing money at ATMs in certain countries. The issues have been resolved but the English-speaking contact at the bank had not always been available.

Overall, they knew what to expect from banking in countries like Ghana and Ivory Coast, and are satisfied.

Before you ask: “Does this mean I am guaranteed to be able to open an account with these banks? And that they will open bank accounts for my offshore company?” No.

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