Banks

[Ronald Wallie]

I am new to this website. I have learned elsewhere, however, that Caye International Bank, LTD, is a good bank for US citizens to easily establish an off-shore account. The Rolodex on this site lists some banks, but Caye is not among them. Is this because no one in IL is familiar with Caye, or are there some concerns with this bank? [Ron Wallie]

[COUNTRY EXPERT ANN KUFFNER]

Ron,

If you go back and read through the Belize Insider monthly reports, you’ll find that I’ve written about the impact of FATCA upon banking in Belize several times. All banks in Belize are having correspondent bank issues since the Bank of America decided to pull out of Belize as the correspondent bank. Some banks have been able to overcome these challenges, others have not. We are indeed familiar with Caye Bank. Caye International Bank is strictly an international bank. It’s had correspondent bank issues over the years, even before FATCA came into play. When a bank loses their correspondent bank keep in mind that you can’t get your money into or out of the account.

If you plan to live or spend much time in Belize the first priority is to open a BZ dollar account, as that is how you will pay bills and take out money at local ATMs. Caye Bank does not have a Belize dollar branch, as the other banks do. For banks with both, you can transfer from US dollars into BZ dollars fairly easily. A number of expats told me that they closed out their Caye Bank accounts due to the excessive fees. In late 2013 Caye Bank charged $300/account for “FATCA fees”. I did not hear of any of the other international banks in Belize charging this kind of fee. I asked the Atlantic International Bank staff when they would start to charge an excess fee to deal with FATCA. They smiled and explained that the FATCA paperwork is just part of doing business.

We closed our Caye Bank accounts on the advice of our Belizean lawyer, and also to avoid the excessive FATCA fees. Recently, in November 2015, I’ve been contacted by several financial advisors who wanted to inform me that their clients have not been able to remove their money from Caye Bank.

Also, if you move here, you can have a offshore US dollar account as a non-resident, or as a QRP. But once you become a resident, you can only have a BZ dollar account. Even if all international banks in Belize were to lose their correspondent banks, it should still be possible to move US dollars into a BZ dollar account. But given the bank challenges in Belize right now, due to FATCA and the BofA de-risking, I would not recommend that anyone view Belize as an offshore haven where you can stash money offshore at this time. Belize is on the USA’s blacklist due to money laundering and income tax evasion. Belize is working to improve their reputation. But for the time being, given what I’ve been seeing on the ground in Belize, I do not consider Belize a very secure place to park money offshore. My advice, for the time being, is to only move the money here that you will need to live on.

My husband and I have had both an international and BZ dollar account at Atlantic Bank for years and have received very good service, at reasonable rates. Atlantic International Bank did lose the BofA as a correspondent bank. But they found a new correspondent bank fairly quickly. They were honest about the situation with their clients and updated info on their website, to let clients know the status of the changes. Atlantic Bank also offers mortgages to expats at 9.75%.

[Ronald Wallie]

Thank you so much, Ann, for your speedy and comprehensive reply to my question. You have helped me greatly. I do hope to visit Belize with my wife and family sometime and meet you. I am ready to retire, but I still have four teenagers living with me. They are really nice children but are not wanting to leave Ohio. (Imagine that.)

[COUNTRY EXPERT ANN KUFFNER]

Totally understood, Ron. Good luck with the kids. Most of my younger expat friends who live here have kept their kids in school here until high school. Then they sent them back to the USA for high school, or home schooled them, since the high schools here are not of the quality you expect in the USA. So better to stay put until the kids are out of high school, then get serious about moving here. Your kids will love to visit Belize after they are out of high school. Then you will have a hard time getting them to leave…

Glad I could help. The banking situation in Belize is in a state of flux, so it’s been challenging to stay on top of it. But it’s a critical topic that impacts all of us who live or invest here. I think things will shake out within a year. But right now, with the BofA stating that they plan to pull out of both the Caribbean and Central America, as the correspondent bank, it is having a big impact. Right now mainly Belize is in the spotlight. But it seems that other Caribbean and Central American countries will soon go through the same thing. The difference is that Belize built their reputation as a safe banking country, offering many offshore banks. So this turn of events has really hurt the country and its reputation. Better to be safe than sorry until all banks have found new correspondent banks and they have been maintained them consistently for a year or so, especially since you won’t move here for a while.

[DAVID L.]

We have had an interesting experience with banking in Belize during the last several months.
For cash flow reasons, we decided to get a home mortgage for new Consejo home from Atlantic International Bank. Once our house in the US sells, we’ll remove the mortgage. But, more to the point, Atlantic Internal Bank was great to work with. Arlette Arana (aarana@atlanticibl.com) was extremely helpful. Mention that David and Lynn sent you – I think it will help.
We had a ton of paperwork to complete for a mortgage. More than the US (we have bought/sold 22 houses). I think this is a good thing because it shows the bank is careful about their lending practices. At least that thought made me feel better gathering up all of the necessary paperwork. No guarantee though.

We got caught in the BOA de-risking of Central American banks. Atlantic International kept us informed and did secure an intermediary exactly when and as they promised. So our deal went through on schedule.

Note that there are fees when sending a wire transfer either from the US or to the US (US banks to Belize or Belize banks to the US). Charles Schwab seems to have the best rate and a charge card that does not charge foreign transaction fees. And, don’t forget, many important papers should be “FedEx’ed” to make sure of timing and accurate delivery.

The downside so far with Atlantic International is that they don’t accept US checks anymore. They may in the future but I think it is more of an intermediary bank restriction. It’s a bummer.

We have applied for a local account at Atlantic Bank. We are waiting to hear that we have been approved by the Central Bank. Once your dollars are in Belize dollars, it is time consuming to change the Bz$ back to US$. So be careful how much input into a local Belize bank.

We have found that BEL (electric) and BTL (phone/cell) can be paid online via a US charge card. Very convenient.

I read that the US Social Security check can be direct deposited into a foreign bank account (with some restrictions) once you live overseas. I am checking this out and will let you know.

Hope this helps,
David
David

[COUNTRY EXPERT ANN KUFFNER]

David,

Thanks for your detailed info sharing with the group. Since you recently went through this process, this info is very helpful to anyone who is going to move to Belize in the future, especially during the next year. I would like to add a few more comments, based on yours:

– When converting from BZ to US dollars, there is an exchange rate charged. I would discourage people from converting any US dollars to BZ dollars except for what they need to live on, to avoid excess currency exchange fees. And at times the banks don’t have enough US dollars on hand to make this type of exchange, so expats have to go to an external money changer.
– Although one’s Social Security check can be deposited directly into a Belize bank account, our financial advisor suggested that it’s better to deposit it in your US account and then transfer as needed. Given the recent correspondent banking issues in Belize, it would be difficult to deal with any SS checks that might get bounced back to the US if there are future problems. My husband and I have our SS payments deposited directly into our Schwab account and then transfer them to Belize as needed.
– I think that the Belizean branch of Atlantic still accepts check deposits, but the international bank doesn’t. But I’ll check on that, just in case it has changed.
– As you mention, David, Schwab is a great company for those of us who live overseas. We are very happy with their service and the fact that they don’t charge international fees on credit card charges, and they reimburse us for overseas banking fees charged at ATMs when we take out money. Note that it is difficult to make transfers from outside of the USA into Schwab Bank accounts, but much easier to transfer into a Schwab brokerage account. The banks are under more “scrutiny”. So it’s worthwhile having a brokerage account at Schwab if you expect to need to transfer money back into the USA from outside of the country in the future.

[Robert Venner]

Thanks for all the great information, although I think I have more questions than before. Does anyone have any info on Credit Unions?
I haven’t used a bank for anything for almost 30 years.

Bob V.

[COUNTRY EXPERT ANN KUFFNER]

Bob,

There is at least one credit union in Belize I know of. But it is a Belizean bank, vs. an international bank. So it would not have US dollar accounts. I assume it would not have the ability to accept US $ wires.

I have never met an expat in Belize who is using a local credit union. I assume that this type of bank would cater to Belizean citizens, vs. expats. Even if they did agree to set up an account for you, I assume you would need to be living here full-time.

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