A REPORT FROM SOVEREIGNMAN.

COM

ULTIMATE OFFSHORE
BANKING GUIDE
ULTIMATE OFFSHORE
BANKING GUIDE

CONTENTS
1. Why You Should Consider an Offshore Bank Account................................................ 4
2. Benefits of Offshore Banking.................................................................................... 10
1. Protection from Financial Shocks.......................................................................... 10
2. Protection from Asset Seizure................................................................................ 10
3. Protection from Capital Controls.......................................................................... 11
4. Other Benefits....................................................................................................... 12
3. How to Pick an Offshore Bank.................................................................................. 12
1. Analyzing an Offshore Banking Jurisdiction.......................................................... 13
2. Analyzing an Offshore Bank.................................................................................. 14
1. Liquidity....................................................................................................... 14
2. Solvency (Capitalization).............................................................................. 17
3. Lending and Investment Behavior ................................................................ 18
4. 5 Banking Jurisdictions Compared............................................................................ 19
1. United States......................................................................................................... 19
2. United Kingdom................................................................................................... 21
3. Hong Kong........................................................................................................... 23
4. Norway................................................................................................................. 24
5. Singapore.............................................................................................................. 25
5. Offshore Banking for US Citizens and Residents....................................................... 27
6. Further Resources...................................................................................................... 28

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DO YOU THINK IT MATTERS WHERE

YOU BANK?
Most people don’t. They just park their savings in any institution with “bank” in the title,
assuming that it’s safe because it’s guaranteed by the government.

That is a major mistake.

If your money is in a US or European bank it is highly likely that it is not well-capitalized

enough to weather the next financial shock to hit the system.

Meanwhile, the government insurance corporations, central banks, and governments

supporting the financial system have run out of the tools to save the day if crisis strikes.

They’ve printed and borrowed so much and lowered interest rates so low that they simply
lack the tools to fight off another financial crisis.

Where you bank is critical in safeguarding your life’s savings.

And you want to be sure that you can depend on it and that even if times get tough that
your money will be there.

Luckily there is literally a world of options out there.

There are banks easily 10 times more capitalized than your current one, and even banks that
pay over 5% interest on your savings.

I invite you to read on in this special report to learn how and why to protect your savings by
putting them in a sound institution overseas, how to do your due diligence on your bank,
and some recommended jurisdictions to get started.

Welcome to the first and most crucial step of building a strong Plan B.

Kind regards,

Simon Black

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WHY YOU SHOULD CONSIDER AN

OFFSHORE BANK ACCOUNT
The uncomfortable truth is that most banking systems in the West are highly illiquid
and borderline insolvent.

I’m not saying this to shock you. This is a fact, based on publicly available financial
statements.

In the current system, when you deposit your money in a bank, the bank takes the vast
majority of that money and lends it out or invests it in other financial instruments.

It keeps only a small fraction of your money on “reserve” in case you ever need to make a
withdrawal or transfer money out of the bank.

In fact, many banks maintain balances that are as little as 1% to 2% of their customer
deposits, which is a miniscule margin of safety in case of a financial shock.

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WHY THE GOVERNMENT WILL NOT BE ABLE TO BAIL BANKS OUT

Most people don’t think this a problem, because the central bank, or the government, or the
FDIC, can just bail the banks out.

But today the largest, most vital central banks in the world are in precarious position
themselves, and they don’t have level of capital necessary to save the financial system.

Just take a look at Section 5 of the US Federal Reserve’s H.4.1 report (published every
Thursday) and you can see just how pitifully capitalized the world’s largest central bank is.

At the time of this writing the Federal Reserve holds around $40 billion in capital,
calculated as the Fed’s total assets minus its total liabilities.

It’s like calculating someone’s net worth: you add up the cash, the house, the car, etc. and
then subtract the mortgage and credit card debt.

Naturally, the higher the Fed’s net worth, the better.

Now, a net worth or equity of $40 billion may sound like a lot. But when you compare that
to $4.5 trillion the Fed has in total assets, it’s nothing.

As a percentage, it puts the Fed’s capital reserve at a razor-thin level of 0.88%!

This means that if the Fed’s assets decline in value by just 0.88%, the largest central bank in
the world would become insolvent.

That’s essentially what happened to Lehman Brothers and numerous other banks in the
wake of the 2008 financial crisis.

Now, what does it actually mean if a central bank becomes insolvent? Can it even happen?

When an entity becomes insolvent, all of its liabilities, its debts, drastically lose value, since
it becomes unable to honor them.

What are the liabilities of a central bank? Look into your wallet. The green pieces of paper
that we call US dollars are liabilities of the Fed. It even says “Federal Reserve Note” on
them.

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In case the Federal Reserve becomes insolvent, the currency it issues would lose its value.

Can this even happen? Sure it can. There are numerous examples even in recent history
when central banks themselves went bust.

Remember the spectacular hyperinflation in Zimbabwe a few years ago? Or the more
recent crisis that wiped out the financial system in Iceland, from which the country and its
currency are still recovering...

But can’t the government just step in to save the central bank if that were to happen?

No. Because the US government is also insolvent.

The US Government Accountability Office’s financial statements plainly state that the US
government’s net financial position is NEGATIVE $17 trillion (it’s right there on page 48).

And if you include long-term liabilities, the number is as bad as NEGATIVE $40 trillion.

Then there’s the FDIC, which insures deposits in the US banking system.

In its 2014 annual report the FDIC itself points out that its whole insurance fund

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constitutes just a fraction of a percent of all deposits in the system, and that its ‘reserve ratio’
is just 1.01%.

With a reserve so low, the FDIC not only lacks any meaningful teeth to insure the system,
but it actually fails to meet the minimum level that is required by law.

This means that the FDIC’s finances are actually worse off than the banks it’s supposed to
insure.

Curiously, the FDIC’s reserves today are actually far lower than they were prior to the last
financial crisis.

On top of that, back then the FDIC only insured $100,000 worth of your deposits per
financial institution. Now it’s $250,000.

So essentially the FDIC is on the hook to pay more than twice as much money to
depositors, yet it has a lower reserve to support an even larger banking system than before.

When the banks, their insurers, and the government that backs them are all close to
insolvency, you know this is not a safe place for your savings.

IF YOU THINK THE US IS IN BAD SHAPE, TAKE A LOOK AT

EUROPE AND JAPAN.
Most of the major countries in Europe have amassed significant liabilities with some having
debts that amount to well over 100% of their GDP.

Then there’s Japan, where the government’s financial situation is so bad that they spend
43% of tax revenue just to pay interest on their prodigious debt.

This is serious. It’s entirely unsustainable. And it means that the government is in no
position to support its banking system.

The thing is, though, very few people actually bother to look at their bank’s financial
statements. We’re all made to believe that banks are inherently safe.

They operate in grand buildings and come with government guarantees… so few people
give any thought before putting their savings in the custody of these institutions.

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But as I’ve already explained, those guarantees aren’t worth the paper they’re printed on.
And those grand buildings are nothing but window dressing.

Even after seeing firsthand how many banks failed back in 2008, and knowing fully well
how deeply indebted their governments are, barely anyone acknowledges the obvious risks.

Most people think everything will be alright simply because everyone else believes the same
thing. But this is an extremely dangerous assumption to make.

DON’T FORGET ABOUT

CYPRUS...
It’s the same foolish assumption that the
people of Cyprus made back in 2013.

For year, Cypriot banks were illiquid

and insolvent. And the data showing
the vulnerability of the financial system
was out there in the public, available for
anyone who cared to look.

Heck, the government itself admitted

a few months before the final straw broke that the financial system was very risky, would
likely require a bailout, and that the government was too broke to save the banks.

So on Friday night, March 13, 2013, Cypriots went to bed thinking that everything was
fine.

Many people had probably logged on to their banks’ websites that day to check their
balances and saw nothing wrong.

But then they woke up the next morning to find that the government had closed ALL
banks and that ALL accounts were frozen.

People found out the hard way that, just because they could see an account balance printed
on a computer screen, didn’t mean that their bank actually had the money.

The money wasn’t there. And eventually the banks could no longer keep up the charade.

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The situation went from ‘normal’ to ‘full-blown crisis’ literally overnight.

This happens more often than you think.

Governments have the authority to freeze and confiscate your assets at the drop of a hat,
and they can use that authority the moment they decide that either you’ve done something
wrong (whether or not you actually have), or that they need to “bail in” a broken financial
system.

This is what governments do when they have no other choice. It has happened in the past in
the United States and it has been happening with greater and greater frequency around the
world.

The conclusion to draw here is very simple:

When every shred of objective evidence suggests that every major institution in your
home country’s banking system is borderline insolvent, does it really make sense to
hold 100% of your savings there?

No. That’s why I advise my family members, my close friends, and our readers to consider
moving at least a portion of their savings to a strong bank overseas.

If something happens, you don’t want to be left stranded, unable to access your own money.
So it’s of extreme importance to diversify your assets across multiple, stable jurisdictions.

This is one of the most important steps in your journey to create a life where no matter
what happens in the world-- you will be ok.

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BENEFITS OF OFFSHORE
BANKING
PROTECTION FROM FINANCIAL SHOCKS
Threat 1: Your bank is highly illiquid and potentially insolvent.

As I’ve mentioned before, nothing has actually been fixed since the last crisis. In fact the
situation is even worse.

Bad banks were not allowed to fail, and thus they were ultimately left to keep on doing what
they’d been doing leading up to the previous crisis.

In the meantime governments and central banks racked up monstrous debts and exhausted
every tool they had to keep this broken system afloat.

Given these inputs, another financial crisis is very likely. And if you’re smart, you’ll make
sure that your money is in a highly liquid, solvent bank. This minimizes the chances of your
savings simply disappearing.

PROTECTION FROM ASSET SEIZURE

Threat 2: Your assets can be frozen in an instant.

You may not even know it, but US banks filed 1.6 million suspicious activity reports (SARs)
last year. Chances are that your bank submitted one about you.

Even withdrawing or transferring a low 5-figure amount can trigger the bank to submit a
suspicious activity report, as they are forced to spy on and rat out their customers.

If some government agency decides that your financial transactions are potentially linked to
illicit activity they can seize your account with just one click. They don’t need to have any
proof of actual illicit activity to do so, it is solely up to their discretion.

Of course you can sue them to try to prove your innocence, but with your accounts frozen
what funds would you use to do that?

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Here, having an account overseas in a foreign jurisdiction means that for whatever reason,
your home government can’t freeze with just a phone call.

It’s a great way to keep some funds out of their immediate control.

PROTECTION FROM CAPITAL CONTROLS

Threat 3: Bankrupt governments almost invariably resort to capital controls. Are you willing to
bet it all that this time is different?

It’s widely known how deeply in debt the US government is. And despite what politicians
might think, governments cannot keep borrowing and printing forever. Some day their
credit will run out.

Historically when people start to sense that things are going south economically in their
country, they start moving their money towards the exits.

It’s precisely what’s happening in places like Greece, and even China, where depositors are
pulling billions out of the banking system.

Governments take steps to prevent this from happening by imposing capital controls.
They restrict foreign exchange transactions, wire transfers, and even withdrawals, all to
prevent you from taking money out of their precious banking system.

Moving a portion of your savings to a safer jurisdiction with minimal debt can substantially
reduce this risk.

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OTHER BENEFITS OF AN OFFSHORE BANK ACCOUNT

An offshore bank account is an insurance policy against a whole range of potentially devastating
financial events. But that’s not the only benefit of having some savings in a foreign bank.

Take for example—

Currency Diversification
Some banks allow you to hold your funds in multiple currencies so that you can diversify your
currency exposure. This can be a good hedge against troubled currencies like the dollar or the
euro, or it can enable you to profit from currency fluctuations. A single bank account in Hong
Kong for example can enable you to hold your savings in dozen different currencies all at once.

Better Interest Rates

Often you’ll also find that interest rates abroad are far better than domestic ones. Yes, it
might be surprising that there are countries where the central bank has not set interest rates
artificially low, and they are thus closer to market rates.

Better Service and Perks

Banks in the West think they’re innovative when they launch a Facebook fan page or a mobile
app. There are banks in Asia that will let you hold gold bullion in your savings account or even
buy into the next big IPO at an ATM machine. Why not see what is being offered out there?

HOW TO PICK AN OFFSHORE BANK

Searching the Internet for “Offshore Banking” you will find hundreds of pages and advisors
eager to recommend options to you. As with anything on the Internet, some of these
recommendations are reliable, while others are recommended because the promoter receives
a commission for doing so.

In this section I want to give you the tools to do your own due diligence and to be able to
confidently tell whether a bank is safe or not. This may seem overwhelming at first, but it
is absolutely essential to do, and this is the exact process we go through for each and every
bank that we recommend to our clients.

Here at Sovereign Man we focus on finding and recommending highly liquid, well-
capitalized banks in jurisdictions that have low (or zero) net debt and are supported by well-
capitalized central banks.

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We do NOT advise our customers to get an “offshore bank account” just for the sake of it
being offshore.

We seek real banks in reputable jurisdictions, that do real business with real customers.

Putting your money into just “ANY offshore bank account” without considering the
following factors could put you into a situation that is potentially WORSE than the bank
account you have in your home country.

When you want to analyse a bank you need to look at two things: the bank itself and the
jurisdiction it is based in.

ANALYZING AN OFFSHORE BANKING JURISDICTION

To start with, you first need to be familiar with a particular jurisdiction. If the country is
bankrupt, or the central bank is practically insolvent, then this makes the entire banking
P:
system dangerous.

I prefer strong, financially sound jurisdictions with low or zero net debt and central banks
with strong balance sheets.

Each individual country’s central bank will also have its own rules and regulations on reserve,
liquidity, and capital adequacy ratios that banks operating in that jurisdiction must follow.

And, as with anything, some countries are more financially conservative than others.

The key metrics to look out for are:

● • Government net financial position [total assets minus liabilities, debt as a

percentage of GDP

How indebted is the national government? How close are they to not being able to
pay their obligations? Because the day they can’t pay their obligations is when they
will turn to your savings to close their budget gap.

● • Central bank solvency [net equity/total assets]

Can the central bank withstand significant pressure? Will it really have the available
tools to support the system in a crisis?

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It is also important to note that banks have to adhere to the regulations of the country in
which they are operating. This means an American bank like Citibank operating a branch in
Hong Kong, will have to follow Hong Kong’s rules and regulations.

Although it may have weak fundamentals in the United States, the Hong Kong branch
is legally a separate entity from the parent company in the United States, and as such
maintains its own balance sheet and abides to the significantly more strict regulations of the
Hong Kong Monetary Authority.

Beyond that, what you need to be looking at is the state of the jurisdiction’s government and
economy. Stability is key in this case, so qualitative traits to look out for include:

● • Historical and current stability—does an upheaval of the existing order seem like a
possibility? How volatile is its economy?

● • Track record of respecting private property rights—do they have a history of asset
seizures and/or capital controls?
●
ANALYZING AN OFFSHORE BANK
Once you feel comfortable with the jurisdiction itself, the next step is to pick a particular
bank. Here, doing your due diligence is absolutely essential.

I start with analyzing an individual bank’s balance sheet. If you cannot find it online (they’re
usually found among the regulatory disclosures the bank is required to provide), ask one of
the bank representatives on the phone or in person.

If a bank refuses to provide you its balance sheet, you do not want anything to do with
them. My advice is: RUN.

From here you want to assess the bank’s Liquidity and Solvency; the same key metrics by
which you should already have assessed the jurisdiction’s government, central bank, and
banking system as a whole.

Liquidity
Liquidity is key. A liquid bank is able to withstand a bank run and minor panics. A liquid
bank is able to honor all withdrawal requests without delay because they have the available
funds on hand.

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A bank’s liquidity is primarily determined by what proportion of depositors’ funds it holds in

cash reserves and in liquid assets.

A healthy bank maintains adequate (or even excess) reserves with the central bank. And it can
be instructive to look at an entire banking system’s statutory requirement for reserves.

Some banking systems, like in Lebanon for example, impose very high reserve requirements on
banks. Others are less conservative.

In the United States, reserve requirements can be as low as zero. In Canada, there is no
statutory reserve requirement at all.

This means that Canadian and US banks essentially have no requirement to maintain a single
penny of customer deposits on reserve. And that, ladies and gentlemen, requires that you have
a LOT of trust in your bank.

Trust that if there’s a financial shock and a run on the bank, that they will actually have money
to pay out to you.

As a really simplified example, let’s say there are two banks, each with $100 in deposits.

Bank A keeps just $0.40 in cash, $0.50 in bonds, and $99.10 in loans, while Bank B keeps $5
in cash, $5 in bonds, and $90 loans.

The key here is that not all assets and loans are equal.

Cash, by default is the most liquid asset.

Generally speaking, loans (mortgages, car loans, etc.) are much less liquid than, say, 28-day
government bonds.

It will take a bank about half a second to liquidate government bonds. Loans, on the other
hand, need to be recalled or collateralized in complicated transactions. This is NOT liquid…
especially if everyone else is trying to sell at the same time.

So a liquid bank has a fairly low “loan to deposit ratio”. The fewer loans outstanding relative
to the total deposits, the more “liquid” a bank tends to be, and the more able they are to
withstand a crisis.

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With that in mind, which of these banks do you think would be better able to withstand a
major financial shock and have cash to pay out to the depositors lining up at their doors?

Obviously Bank B, which has both more in cash reserves and in highly liquid assets.

So while a mere whisper of a bank run could lead to withdrawal controls or bankruptcy for
Bank A, Bank B could withstand significantly more pressure.

In case you’re wondering why these examples are down to the

penny, it’s because they’re based off of banks’ real financial
statements. Bank A is that of JP Morgan, while Bank B is one of
the institutions we have hand-picked for our customers.

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Solvency (Capitalization)
Solvency describes by how much a bank’s assets can drop in market value before its liabilities
are greater than its assets and thus the bank becomes insolvent.

A healthy bank holds strong capital reserves on its balance sheet, so that if some of its assets
go bad and become unrecoverable, the bank still has enough funds to cover its depositors
and creditors.

I look at how much equity (assets minus liabilities) a bank has as a percentage of total
assets.

Continuing from our previous example Banks A and B each have $100 in total assets—cash,
bonds, loans, etc.

Bank A (JP Morgan) has $90 in liabilities—customer deposits, debt, etc. So its net equity is
just $10, or 10% of its assets.

Viewed alone, this would generally be an acceptable level of solvency, but when a bank is as
illiquid as this one, solvency must be much higher to compensate.

In comparison, Bank B has just $80 in liabilities, so its net equity is $20, or 20% of assets.

If the market value of Bank A’s assets falls by 10%, its liabilities are then greater than its
assets, and it would be insolvent and out of business.

Bank B, on the other hand, has enough capital to withstand a 20% drop in its asset
valuations. This, together with its high level of liquidity puts this bank in a very strong
position.

These two factors together give us a very strong idea of a bank’s margin of safety.

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Again, these are real examples. It is scary to think of how many people hold the whole of
their life’s savings in banks with liquidity levels as shockingly low as that of JP Morgan here,
completely ignorant of the risks.

Lending and Investment Behavior

Beyond just the numbers are the institution’s principles.

A healthy bank doesn’t engage in excessively risky lending or investment behavior, thus the
likelihood its assets will be impaired is low in the first place.

As a borrower, you want a bank that gives out loans with low interest rates, with easy credit
requirements and flexible terms. As a depositor, on the other hand, you are looking at exactly the
opposite of that, since it is YOUR money they are lending out and gambling with. You want a
conservative, risk averse bank that will act as a prudent custodian of your savings.

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Just as not all assets are the same, not all loans are the same either. Some banks are very
cautious to whom they give loans, taking care to see that they are likely and able to repay
them.

You can examine the bank’s financial statements to see that it doesn’t invest too much in
assets that are deemed to have a heavy “risk-weighting.”

A community bank that specializes in making short-term, secured mortgage loans to doctors
and dentists, for example, will likely be preferable to one that uses its depositors’ money to
invest in penny stocks.

To assess this, I suggest that you take a good look at the bank’s business model. A good
indicator of any bank’s loan practices is also its current and historical “non performing loan
(NPL) ratio”.

Responsible banks do not make loans to subprime borrowers, who by definition are highly
unlikely to make good on their loans.

Thus you should be very wary of banking in any country with “affordable housing”
legislation, which encourages mortgages to be given to people who cannot afford them.

This interferes with sound banking practices, and makes the whole system far riskier.

5 BANKING JURISDICTIONS
COMPARED
POOR
UNITED STATES GOVERNMENT NET POSITION: POOR
US FEDERAL RESERVE CAPITAL RATIO: POOR
BANK LIQUIDITY: POOR
BANK SOLVENCY: ADEQUATE
Government net position: POOR

The federal government’s net position is minus $17 trillion, which is far in excess of US
GDP. This means that the US government lacks the financial wherewithal to credibly bail
out its banking system or support depositors.

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US Federal Reserve capital ratio: POOR

The Fed already had razor-thin capitalization to begin with, but as of 2016, that was cut in
half. Now at just 0.88% capitalization they have next to nothing in reserves as a buffer in
case financial crisis strikes.

Bank liquidity: POOR

As an example, let’s take a look at JP Morgan, which as of the end of 2015 has $20.49
billion in cash equivalents to support $1.279 trillion in customer deposits. That’s a liquidity
ratio of just 1.60%. Not only is that pitifully small, but it’s also down from 2.05% just a
year ago.

And JP Morgan is supposed to be a ‘healthy’ bank.

Bank solvency: ADEQUATE

Again, JP Morgan is currently posting total capital of $248 billion, or roughly 10.53% of its
total assets of $2.35 trillion.

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Ordinarily this would be an acceptable margin of safety, but when a bank has very little
liquidity, I want to see a MUCH higher margin of safety.

Think about it like this—if just 1.6% of JP Morgan’s customers want to withdraw their
funds, then JP Morgan is out of money.

Ordinarily this wouldn’t happen. But in serious financial shocks, bank runs do occur… so it
would seem likely that they would far surpass this 1.6% threshold.

If that happens, JP Morgan would have to sell some of its assets in order to raise cash. The
problem with this is that in a financial shock, the sale of assets does not happen in an orderly way.

Asset sales in a financial shock are more like fire sales. Asset values are plummeting. You
don’t get reasonable market value. You get distress prices.

So with a margin of safety of just 10.53%, it’s possible that JP Morgan’s assets could
deteriorate far beyond that level in a financial shock.

Bottom line, they don’t have enough cash to meet basic liquidity needs. And if they needed
to liquidate assets to raise cash, they don’t have a sufficient margin of safety to ensure
solvency in a fire sale.

All of these factors—low bank solvency, low bank liquidity, low central bank solvency,
government insolvency— suggest that the US is not an appropriate place in which to hold
the majority of yours savings.

POOR
UNITED KINGDOM GOVERNMENT NET POSITION: POOR
BANK OF ENGLAND SOLVENCY: POOR
BANK LIQUIDITY: ADEQUATE

Government net position: POOR BANK SOLVENCY: POOR

Though nowhere near the US’ levels of indebtedness, the UK government is seriously deep
in the hole with £1851.8 billion in net liabilities. When a government’s finances are strained
not only does this prevent it from being a backstop for the financial sector, but it also can
lead to confiscation measures if pushed too far.

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Bank of England solvency: POOR

The Bank of England, the UK’s central banking institution, has capital and reserves of just
£3.4 billion to back £408.5 billion in assets. At just 0.83%, this is even worse than the
Federal Reserve’s own perilously low level of capitalization.

Bank liquidity: ADEQUATE

Taking a look at the financial statements of Barclay’s, one of the UK’s biggest banks, you’ll
find a liquidity level of roughly 9.28%. This is not necessarily cause for concern, but I
typically prefer at least double digit levels of liquidity before I put my money anywhere.

Bank solvency: POOR

What is cause for concern, however, is Barclay’s level of solvency. At just 4.86%, this is very
low and puts the institution in a very precarious position. If the stock market were to tank
and asset prices were to fall, it wouldn’t take much to render the bank insolvent.

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HONG KONG
Hong Kong receives top marks from me as one of the best GOOD
places in the world to bank. The central bank is one of the GOVERNMENT NET POSITION: EXCELLENT

best capitalized in the world, and the banking system is CENTRAL BANK SOLVENCY:
BANKING SYSTEM LIQUIDITY:
EXCELLENT
GOOD
extremely liquid. BANK SYSTEM SOLVENCY: ADEQUATE

Over the past few years it has become increasingly difficult to open a bank account in Hong
Kong as a foreigner, but it is still possible.

Government net position: Excellent.

Hong Kong’s cumulative debt load is negligible, about 2% of GDP. And despite having
some of the lowest tax rates in the world, the Hong Kong government almost always runs a
budget surplus.

Central bank solvency: Excellent.

The Hong Kong Monetary Authority is one of the highest capitalized central banks in the
world, as of Q4 2015 its capital ratio is 18.9% of its assets. That’s literally 21-times more
than that of the Federal Reserve.

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Banking system liquidity: Good.

HSBC Hong Kong’s most recent annual report shows cash equivalents equal to 10.22% of
customer deposits. This is a good ratio.

Banking system solvency: Adequate.

HSBC Hong Kong’s net equity is equal to 8.77% of total assets. HSBC also has a conservative
loan-to-deposit ratio which stands at 62%. Given the overall health of the Hong Kong
banking system, this is a more than a reasonable figure.

NORWAY V.GOOD
Norway always receives top marks from me given how GOVERNMENT NET POSITION: EXCELLENT

liquid the banking system is, and how healthy the CENTRAL BANK SOLVENCY:
BANKING SYSTEM LIQUIDITY:
EXCELLENT
EXCELLENT
government’s financial position is. BANK SYSTEM SOLVENCY: ADEQUATE

The Norwegian central bank is THE most well capitalized in the world, meaning that the
Norwegian krone is the cockroach of fiat currencies. It will be able to withstand even a nuclear
shock to the financial system.

Government net position: Excellent.

Norway is so wealthy that its net financial position is well over 100% of GDP. Not only does
this mean that they have no net debt, but they’ve built up a significant fund from oil revenue
and tucked it away to cover future liabilities. All of this is tucked away in a rainy day fund.

Central bank solvency: Excellent.

Again, the Norwegian central bank is prodigiously capitalized. Its March 2014 balance sheet
showed net equity equal to 31.6%. Compare that to the US Federal Reserve’s, which is at just
0.88%. It’s an astounding difference.

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Banking system liquidity: Excellent

We were a bit troubled by DNB Norway’s latest financial statement for Q3/2015 showed
that their ratio of cash and cash equivalents to customer deposits were at an impressive
19.9%.

Banking system solvency: Adequate.

DNB Norway’s net equity has risen significantly since last year to 8.88% of total assets.

Ultimately DNB is partly owned by the cash-rich Norwegian government, so the likelihood
of a failure is minimal. Not to mention, DNB runs a very conservative portfolio with zero
exposure to any toxic US or European assets.

SINGAPORE
Like Hong Kong, Singapore has an incredibly well
developed financial system that has become one of the
GOOD
most important in the world. And I am frequently GOVERNMENT NET POSITION:
CENTRAL BANK SOLVENCY:
EXCELLENT
ADEQUATE

discussing the benefits of banking in the city-state. BANKING SYSTEM LIQUIDITY:

BANK SYSTEM SOLVENCY:
EXCELLENT
GOOD

Government net position: Excellent.

Like Norway, Singapore has no net debt.

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Central bank solvency: Adequate.

The Monetary Authority of Singapore has lost billions over the years trying to keep its
currency artificially depressed against the US dollar. It’s not working.

Net central bank capital was at 10.50% of total assets as of the end of 2014.

Banking system liquidity: Excellent.

In their 2014 financial statements DBS in Singapore recently posted cash equivalents equal
to roughly 13.08% of total customer deposits.

Banking system solvency: Good.

DBS’s net equity constitutes 10.31% of its total assets. Together with the bank’s high level of
liquidity level, this is a solid figure.

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OFFSHORE BANKING FOR US

CITIZENS & RESIDENTS
It is completely legal and reasonable, even as a US citizen and resident, to have an offshore
bank account.

There is nothing to be scared or worried about as long as you report it properly to the IRS.

In order to do this, you must make sure that all of your financial activity is conducted
openly and legally.

Financial privacy no longer exists in today’s world, so there is no point in trying to hide your
assets in order to avoid tax. Instead, it’s all about making sound, transparent financial decisions to
minimize your risk and tax burden.

Thus, it is essential that every year you fill out the following forms and include them with your
taxes by April 15:

● • FBAR (FinCEN 114*), if the total amount held in accounts abroad exceeds
$10,000.
●
● • Form 1040 schedule B
●
● • Form 8938

*This has replaced the TDF-90-22.1, which is no longer the appropriate form).

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FURTHER RESOURCES
Faced with literally a world full of options, it may be quite a task to figure out which offshore
bank is best for you.

At Sovereign Man, it’s our business to research and conduct extensive due diligence on
worldwide banking options to ensure they’re appropriate tools in a great Plan B.

SOVEREIGN MAN: EXPLORER

Explorer is your essential introduction to international diversification, a guide to ensure you
have access to the most important tools to build your own Plan B.

With Sovereign Man: Explorer, you’ll learn...

●
• how to strategically, legally, and intelligently structure and implement your personal Plan B
• how to establish residency abroad and qualify for a second passport
• how to buy and hold your precious metals at one of the safest storage facilities in the world
• ways to reduce, defer, and even ELIMINATE a substantial portion of your taxes

SOVEREIGN MAN: CONFIDENTIAL

Sovereign Man: Confidential is our flagship intelligence report service informing you about the
best places on Earth to safely protect your life, your liberty and your assets.

Our intelligence reports cover everything from new residency or foreign banking options to
how to reduce, defer, or even eliminate your taxes, to incredible investment picks.

We have covered and done in-depth analysis of the best offshore banks from all over the
world suiting many different needs.

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