Banking sector - Major changes

Updated: Sep 20

The year of 2017 will be the year of substantial changes within the Banking Sector internationally and Cyprus will definitely not be an exception. 

The year of 2017 will be the year of substantial changes within the Banking Sector internationally and Cyprus will definitely not be an exception. 

The Fourth European Union Anti Money Laundering Directive (4th EU AML Directive) on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing has been adopted by the European Parliament on Wednesday 20 May 2015 giving member states 2 years from publication to incorporate it into national law. Cyprus will integrate the provisions of this new directive until March 2017. 

The 4th EU AML Directive along with the introduction of the OECD Common Reporting Standard (CRS) and the Foreign Account Tax Compliance ACT (FATCA) are set to radically change the global financial industry as a whole and particularly impact banks and other financial institutions.


From this point onwards banks and other financial institutions will need to create higher and stricter standards in regards to KYC records, verification of documents, and verification of the identity of the controlling persons/Ultimate Beneficial Owners (UBOs) of corporate entities and trusts and customer due diligence processes.

Under this new regime banks will request more detailed information from individuals and corporate account holders in regards to their transactions.


Also, opening a bank account will become a more tedious and complex process, with individuals and corporate entities having to provide banks with detailed information on various matters including tax residency, Tax Identification Number (TIN), line of business and identity of controlling persons.

Despite these changes and the upcoming unfamiliar territories that the banking world is embarking on, Cyprus will remain one of the best jurisdictions to open, maintain and operate a bank account for business and personal purposes.

In comparison with other jurisdictions around the world the banking sector of Cyprus has always been flexible and has consistently adapted to new challenges.


Together with the assistance of Flexi Consultants we will continue our healthy relationship with the banks in Cyprus and carry on the smooth road that we have already embarked on to further your business development and success as always with a personal touch.  

For convenience purposes we have attempted to summarize the most important changes that will be implemented in 2017 in relation to existing and new account holders.


EXISTING CLIENTS:      

  • Audited and Management accounts (where applicable) will be requested by banks on annual basis.   

  • Ultimate Beneficial Owners (UBOs) and/or controlling persons of legal entities will be contacted by a bank representative through Skype Calls for verification of their identity as well as provide an explanation of the nature of their business.  The verification process can also establish through face-to-face meeting.

NEW CLIENTS (OPENING A BANK ACCOUNT FROM 2017 AND ONWARDS):

  • Audited/Management accounts after the 1st year or when applicable.

  • Skype call with UBO/controlling persons, in line with existing client requirement for Skype calls

  • A tax identification number (TIN) and tax residency certificate will be required for CRS and FATCA purposes.          

  • Needless to say the bank will require comprehensive CVs (controlling persons/UBOs), a business card, a website domain of the company along with an email address


The points stated above are just a representation of the most important requirements of opening and maintaining bank accounts in 2017 and do not constitute all questions and or requests a bank may ask in the upcoming future.

As we have mentioned above the team of Flexi Consultants will always assist, in the best way possible, both existing and new clients to operate/open bank accounts in Cyprus. While the changes made in the global banking sector are substantial we nevertheless guarantee to continue catering to your needs and providing you with current and accurate advice.

We are a team of experienced professionals, all sharing a unique drive for learning and development through teamwork. The Group utilizes its various core activities to implement customized solutions for its clients. Our collective experience spans the areas of Global Corporate & Fiduciary Services, Assurance & Advisory Services, Fund Administration, Tax Advisory, Corporate Governance, Financial Services, Private Wealth Services and Compliance.

Start a conversation with us today to find out how you can benefit from a relationship with Flexi Group.

Please get in contact with our Head of Business Development:

Mrs Daniella May / Head of Business Development

Tel.: + 357 7000 2 5555 / + 357 22 87 57 55

E: inquiries@flexi-group.net

We also organize calls using Skype. Our flexi Skype ID is web@flexi-group.net

  • LinkedIn
  • White Facebook Icon
  • White Twitter Icon