Belize is a tiny Caribbean nation that has been quietly transforming itself into an international banking center, offering clients around the world a level of privacy and services once associated exclusively with major European banking centers.

The country itself has many advantages as a banking and business center for North Americans.  Belize the only English speaking country in Central America and is located close to North America, with flights from major international airports that provide easy access to clients and advisers alike.  The country boasts a warm, sunny, climate and beautiful tropical scenery, plus good accommodation for clients, advisers and resident expatriates.  The Belize dollar is pegged to the U.S. dollar at a fixed rate of 2:1, and U.S. currency is accepted by local retailers.  Belize remains on Central Standard time year-round, so its local time corresponds to major business centers such as Chicago, Houston, or Denver, depending on the time of year.  Good Good telecommunications also facilitates international business with the country.

Belize has two types of banks:  Commercial banks serving local customers, and a small but growing community of international banks. These international banks were authorized by the Banks and Financial Institutions Act, 1995, and the introduction of the Offshore Banking Act, 1996, and the Money Laundering (Prevention) Act, 1996.

By law, international banks cannot serve customers who are citizens of or legal residents of Belize. The 1995 legislation defines an international banking as “receiving, borrowing or taking up foreign money exclusively from non-residents at interest or otherwise on current account, savings account, term deposit or other similar account and which according and subject to arrangement is repayable on the check, draft, order, authority or similar instrument of the customer, and investing the foreign money so received by lending, giving credit or otherwise exclusively to non-residents; or carrying on exclusively with non-residents such other activities as are customarily related or ancillary to international banking.”

There are two categories of Belize international banks:

1. Class A – Unrestricted.  The holder of a Class A international banking license needs to establish, maintain, and operate a business office in Belize. It is permitted to transact international banking business through its business office in Belize without restrictions on that business.  Authorized and paid-up capital of at least USD $3 million must be maintained if the license is for a local company, or USD $25 million in the case of a foreign bank.  The annual license fee for a Class A international bank is US$20,000.

2. Class B – Restricted. The holder of a Class B international banking license also needs to establish, maintain, and operate a business office in Belize, but it is limited to transacting only such international banking business as is specified in its license. Class B international banks cannot solicit or accept deposits from the general public, and cannot provide any current deposits or checking accounts to depositors.  Authorized and paid up capital of not less than USD $1 million must be maintained if the license is for a local company, or USD $15 million in the case of a foreign bank. The annual license fee for a Class B international bank is USD $15,000.

Several international Class A banks are in operation in Belize. These banks are regulated by the Belize Central Bank, have physical offices in Belize and offer various services including demand, savings and time deposit accounts. Accounts maintained with these banks are not subject to local taxes or exchange control restrictions.  International banks tout their privacy for their customers, although if the Belize courts find that funds in the banks are proceeds of crime, the banks are required to release the identity of the account owner.  Funds are transferred into and out of Belize in foreign currencies without conversion to Belize dollars.

As the number of countries offering strict banking privacy diminishes, Belize is attracting more attention, and more international banking business, from around the world.