Even in the face of high upfront costs and the increasing burden of regulation, entering the banking business remains an attractive proposition for many. However, with so many potential jurisdictions to choose from, searching through multiple sets of laws to determine the best option can be an unwelcome drain on resources.
Moreover, once a preferred jurisdiction is found, the road to licensing remains long and complex. As a result, many of those looking to set up a bank like the idea of purchasing a pre-existing bank in order to avoid these steps, even if the overall cost is higher. Buying a bank is seldom a fix-all, however: most bank regulators insist on pre-approving new owners and management. A clear benefit of this approach, on the other hand, is that these businesses benefit from established systems and resources.
Setting up a bank
Generally speaking, these are the steps one needs to establish a new bank:
- Researching jurisdictions to see which offer the most attractive commercial opportunities and regulatory environments, bearing in mind the proposed activities, ownership and management of the new bank;
- Putting in place the required corporate structure, bringing in investors and experienced management, if necessary;
- Gathering the documentation required for licensing, often including legalized documents from the directors and shareholders;
- Preparing the bank’s compliance regime, tailored to local regulation. This typically includes writing AML/CFT policies, among other things;
- Filing the completed license application with the authorising body, consulting with them on any questions or additional requirements that they may have;
- Obtaining a SWIFT code to gain access to the global payment system; and
- Establishing correspondent banking relationships to enable the bank to clear foreign currency transfers.
Healy Consultants Group PLC simplifies this process for clients by conducting the research on their behalf, providing a clear recommendation on an appropriate jurisdiction, then project managing the licensing process. Our firm can also research the licensing and operational requirements of shortlisted jurisdictions, providing a clear and understandable path to doing business.
Alternatively, Healy Consultants Group PLC can research existing banks available for sale, approaching vendors to find the right bank, in the right place, at the right price for our client.
For more information on setting up or buying a bank, visit Healy Consultants Group PLC’ page on banks for sale, or contact our experts directly at