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Offshore Banking Unit (OBU)

Offshore Banking Unit (OBU)

What is an 'Offshore Banking Unit - OBU'

An offshore banking unit (OBU) is a shell branch located in an international financial center. Offshore banking units (OBUs) make loans in the Eurocurrency market when they accept deposits from foreign banks and other OBUs. OBUs' activities are not restricted by local monetary authorities or governments, but they are prohibited from accepting domestic deposits.

Explaining 'Offshore Banking Unit - OBU'

OBUs have proliferated across the globe since the 1970s. They are found throughout Europe, as well as in the Middle East, Asia and the Caribbean. U.S. OBUs are concentrated in the Bahamas, the Cayman Islands, Hong Kong, Panama and Singapore.


Offshore Banking Unit (obu) FAQ

What is onshore and offshore banking?

Offshore banking refer to one in a foreign jurisdiction outside where its investors or depositors reside. Onshore Banking refers to the use of banking activities within the same jurisdiction and territories as a nation or a sovereign state.

What is the benefit of offshore banking?

Offshore Banking is used to keep money safe and make it tax-free in some situations. Opportunities not available in domestic banks become available in offshore bank account, such as unique investment vehicles.

Why are offshore accounts illegal?

Offshore accounts are not illegal except if the intent is to evade tax. The Foreign Account Tax Compliance Act (FATCA) will fine banks around the world unless they report account activities of American citizens to the IRS.

Are offshore bank accounts safe?

Offshore banking is 100% legal and it's not about evading tax or other illegal activities. It's truly diversifying your political risk legally with your liquid savings placed in sound, well-capitalized institutions where they are well treated.

What is Offshore Banking Unit?

Offshore Banking Units An offshore banking unit (OBU) is a bank branch that mediates between non-resident borrowers and lenders. An offshore banking unit can be found in an International financial centre.

What are offshore countries?

An offshore country, also known as Offshore Financial Centre or (OFC) is a country or jurisdiction providing financial services to foreigners such that it is out of proportion with the size and the financing of its local economy.

Further Reading

Bahrain's offshore banking centerBahrain's offshore banking center
www.journals.uchicago.edu [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

The Regional Development of Both Sides-the Opportunity of Taiwan's Banks on the Financing Problem of Taiwan's Investors in Chinese MainlandThe Regional Development of Both Sides-the Opportunity of Taiwan's Banks on the Financing Problem of Taiwan's Investors in Chinese Mainland
en.cnki.com.cn [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

Japanese Offshore Banking: Toward A World Financial Center In TokyoJapanese Offshore Banking: Toward A World Financial Center In Tokyo
heinonline.org [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

Financial Deregulation and Offshore Banking: Lessons for Mol'ro from Australasian/Asid-Pacific ExperienceFinancial Deregulation and Offshore Banking: Lessons for Mol'ro from Australasian/Asid-Pacific Experience
books.google.com [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

The Emergence of Cyprus as an Offshore Banking Center.The Emergence of Cyprus as an Offshore Banking Center.
search.ebscohost.com [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

Cyprus: An Emerging Offshore Banking and Financial CentreCyprus: An Emerging Offshore Banking and Financial Centre
link.springer.com [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

India uses tax to promote investment in economic zonesIndia uses tax to promote investment in economic zones
heinonline.org [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …

The Impact of Deregulating OBU's Renminbi's Business on the Financing Behavior of Taiwanese Businessmen in ChinaThe Impact of Deregulating OBU's Renminbi's Business on the Financing Behavior of Taiwanese Businessmen in China
search.proquest.com [PDF]
… The development of the OBU might improve the positions of international financial systems … Thailand's financial system opened up too fast, and an ineffective distinction between offshore and onshore … led to a good circulation of capital and attracted a great deal of overseas capital …


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