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International finance | 25
New deal for non-residents with
a flourishing French bank
Banque Patrimoine et Immobilier has signed a partnership
agreement regarding its foreign currency securities accounts.
The bank has thus strengthened its position among the
substantial non-residential market
by Mary Fort,
Head of International Business
Development, Banque Patrimoine
et Immobilier
A
s most people are aware, the estate purchase in France. This will be achieved 100% real estate loan. The client has access to
pound/euro exchange rate by accepting to pledge a foreign currency bank financing which can amount to the entire
volatility has strongly impacted securities account managed by Cholet Dupont real estate value.
on investment in the real estate for an equivalent value of 25% of the total Tax. For those resident in France, wealth tax
market throughout Europe. The investment. After an initial agreement covering is levied on one’s worldwide net assets which
French market is no exception US$ accounts, Banque Patrimoine & include property holdings, shares as well as cars,
with a sharp decline in investment at the end of Immobilier and Cholet Dupont are now yachts and jewelry, with the starting point being
2008. English, US and Dutch residents, who extending their partnership agreement to ?790,000. Furthermore, it applies not to each
used to be the first to acquire properties in include Sterling and Swiss Franc accounts. individual but to the ‘household’. When the
France, now seem to be more reluctant to There are several types of advantage for client is non-resident, his wealth tax liability is
convert their currency because of the strong clients: calculated uniquely on his property holdings.
volatility of the currency market. Currency risk control. Given that the client Thus his securities account is not subject to
To manage the currency change risk, Banque has no obligation to convert his liquid assets for wealth tax. Furthermore, the real estate
Patrimoine et Immobilier, a French specialist in the purchase, he is not subjected to currency investment is also exonerated from tax due to
real estate investment solutions, and Cholet- risk. He can even actively manage his currency the real estate liabilities generated from the
Dupont, a Private Asset Management firm, have exposure by switching, at any time, all or part of loan. The final result is that the entire process is
decided to offer new solutions to overseas his securities account from one currency to excluded from the wealth tax calculation.
residents to avoid the usual pattern of another without affecting the pledge. As a result of this partnership, Banque
conversion into euro currency. Increased security and value of total Patrimoine & Immobilier is now able to offer
“The strong volatility of dollar and pound financial assets. The client can hold onto and an innovative financing solution for private
currencies against the euro has certainly therefore increase the value of his financial individuals. Both resident and non-resident
become an issue for people who want to assets during the whole financing period. The people who have foreign currency liquid assets
purchase a property in France and feel the foreign currency entrusted assets are otherwise available, and who wish to finance a real estate
obligation to convert their liquid assets in secure, as the pledged securities account has project in France, can now do so without
euros,” declared Olivier Dacquin, the Head of systematically a low-risk management mandate. incurring any currency risk.
Sales at Banque Patrimoine et Immobilier.
“They might want to have the option to be fully
advised to prevent any sudden change on the For information
currency market,” he added. For that reason, Taxable Amount Rate Cumulative tax
Banque Patrimoine et Immobilier has recently To upper limit
decided to collaborate with Cholet-Dupont on 0 – 790,000 - -
the management of their non-resident client 790,000 – 1,280,000 0.55 2,695
assets. 1,280,000 – 2,520,000 0.75 2,695 - 11,660
2,520,000 – 3,960,000 1.00 11,995 - 26,395
Foreign financing 3,960,000 – 7,570,000 1.30 26,395 - 73,325
Banque Patrimoine & Immobilier aims, by this 7,570,000 – 16,480,000 1.65 73,325 – 220,340
agreement, to finance up to 100% of a real Over 16,480,000 1.80
www.investmentinternational.com June 2009 Investment International
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