Offshore Banking in Singapore

Since the government of Singapore announced significant changes to its laws of taxation back in 2004 the Republic has grown rapidly as an offshore centre of note.

Today offshore banking in Singapore is one of the Republic’s fastest growing industries and according to industry analysis the country will be the fastest growing offshore private banking centre in the world within the next five years.

The success of the offshore banking centre in Singapore stems from many factors, not least of which is the fact that Singapore has some of the lowest taxation rates in Asia.  In 2004 when the government announced far reaching changes to its taxation rules it became an even more attractive offshore centre.  Today residents of the Republic are not taxed on income earned overseas and any gains one generates from investments made in Singapore itself remain tax exempt.

Singapore is also one of the few remaining grade A offshore centres that has not signed up to the EU’s Savings Tax Directive, which is probably why the amount of money moved from tax havens within the remit of the Directive to Singapore in 2005 surged.  Financial assets of non resident investors managed by private banks in Singapore in 2005 rose by 25% which is believed to be the world’s largest gain.

Many of the major international offshore and financial players such as Credit Suisse, Citigroup, UBS and Societe Generale are increasing staffing numbers in Singapore to manage the influx of private funds, and the Republic is definitely making a name for itself as one of the most secure, private and well regulated offshore banking centres unaffected by the EU Savings Tax Directive in the world.

It’s not just European money that’s flowing into Singapore; with India and China rapidly expanding economically and more wealth than ever being generated in these two countries the amount of millionaires in China and India looking for an offshore financial haven in Asia is increasing rapidly.  Within the offshore financial industry Singapore is referred to as the Switzerland of Asia, and while the Republic trails the European offshore centre by five places in terms of its size as an offshore private banking centre, it is rapidly gaining on Switzerland in terms of the assets it has under management. 

In 2004 the amount of assets held offshore in Singapore jumped by a staggering 40% and as previously stated in 2005 the amount rose by 25%; predictions for 2006 indicate that the Republic will enjoy another successful year and the short to medium term future of offshore banking in Singapore therefore seems assured.