Offshore Voluntary Disclosure Program
, but with stricter measures and repercussionsthan a similar program introduced two years ago.●
Asset protection: Investors will head East.
With an increasingly unfavorable mood to offshore investing in western and OECD countries,more investors will be driven away from Europe and the U.S. Investing individuals andinstitutions may choose to protect their assets by moving them to emerging economies that offer greater growth outlooks in the recovery stages of the global recession, as well as greater privacy, such as in Asia and the Middle East. This is potentially damaging for the very countriesasking for greater sanctions, as legal use of offshore financial centers represents a large portionof financial revenue for the U.K.’s banking system and the U.S. – technically the largest offshore jurisdiction in the world.●
Technology: Trends that will make it easier to conduct business abroad.
Just a year ago, amidst intense IRS and OECD pressure, UBS bankers in Switzerland wereconfident that the privacy concessions would have minimal effect on the Swiss offshore financialsector. However, a recent case where identities were leaked to website Wikileaks, shows thepervasiveness of the Internet, secrecy is fast becoming a non-option for offshore bankingproviders. The future of the industry is in legal low-tax hubs.Growth in cloud computing results in more business conducted virtually. Get ready to see moretransactions processed over the web, and more business conducted internationally. Trends towatch in 2011 include security threats to banking institutions, challenges and opportunities intokenization, cloud computing and key management.●
Much that will happen this year will be dictated by consumer behaviour. Recession andcollapses of real estate and stock markets have scared investors away from risk.In a recent interview with
,ABN AMRO Chief Executive Officer Private Banking Asia, Hans Diederen, shared that in the post-financial crisis climate, high networth clients had increased their demand for:•Products: Simpler, more liquid investment products, that offer more peace of mind.•Diversifying: Increasing diversification to non-equity asset classes (e.g. bonds andfunds).•Proximity: Investments made closer to home country and region.•Information: more product informationBut one thing that hasn’t changed, Diederen noted, “is, clients’ investment appetite is still verymuch driven by market sentiment.” With these consumer trends, offshore banking in Singaporeandoffshore banking in Hong Kongwill be optimal jurisdictions for investing with mitigated risks.Offshore wealth management will continue to remain dominant, according to
. Asia will continue to be a key growth market for wealth management, outpacing theglobal average for actual and expected wealth growth rates. This will continue to make theinternational business model attractive for the region, with Hong Kong and Singapore remainingstrong regional hubs to serve clients in Asia.