Bahrain, a tax haven for the wealthy, has granted a private banking licence to French bank Credit Agricole to enable it to cater to millionaires.
The French group will run the private bank in Bahrain through its main private banking unit, the Geneva-based Credit Agricole (Suisse) SA, expanding on the Calyon wholesale business it has operated in the Gulf state since 1976.
"The regulatory environment for the financial services industry, as well as Bahrain's strategic geographic location and other infrastructural facilities, make the kingdom an ideal location from where to conduct business," said Ahmed Al Bassam, the licensing and policy director at Bahrain's central bank.
Bahrain levies no wealth, capital gains or inheritance taxes, helping attract the ultra-rich to the island nation. By comparison, capital gains tax in Britain, for example, is charged at a flat rate of 18 per cent.
Credit Agricole joins the likes of JPMorgan, Merrill Lynch and HSBC that run private banks in Bahrain.
Around 40 countries in the world are still widely viewed as tax havens, according to international organisations such as the Organisation for Economic Co-Operation and Development. (Reuters)
Credit Agricole sets up bank in Bahrain