Question

Wealthy individual seek for private banking service for several reasons including portfolio diversification, risk at home country, tax evasion, escape from domestic legal enforcement, and confidentiality. Explain the core client base of offshore private banking as following:

                                                

1. Wealthy individual or families who seek for security

2. Confidentiality

3. Tax-friendly environment offshore

4. Have standard portfolio diversification objectives

5. Lifestyle requirement

Answer 1

Core client base of private banking which is offshore are as following-

A. Wealthy individuals or family who seek for security will try to invest into another country and they will try into having a security of their funds which can be secured from fraudulent practices

B.it also offers with the confidentiality as it is not disclosed to the domestic country and it is trying to have an escape from domestic tax system.

C. Tax friendly environment offshore will help these individuals to park their money in those offshore private banking and it will help them from any disclosure requirement and protection of their confidential money.

D. Have standard portfolio diversification objective because it will help in diversification of the overall portfolio by investing outside and learning through exchange rate fluctuation

E.lifestyle requirement because this will be helpful in maintenance of the lifestyle as they will be also providing of the high rate of interest which will be converted into the foreign currency.