Nominal & Segregated Accounts

Dedicated Account Structures for Client Money, Fiduciary Assets, Projects and Institutional Transactions

International Finance Bank provides Nominal & Segregated Accounts for qualifying corporate, institutional, fiduciary and professional clients requiring funds to be separately identified, administered or held for a specific client, beneficiary, transaction, project, asset or purpose.

These structures are designed for circumstances in which the clear separation of funds is essential to financial control, transparency, governance and the integrity of the underlying legal or commercial arrangement.

Clear Separation. Defined Purpose. Transparent Administration.
A segregated account establishes a distinct banking environment for funds attributable to a particular entity, mandate, transaction, project or purpose.
Rather than commingling monies within a general operating account,

dedicated account structures can provide greater transparency over the origin, ownership, purpose, movement and application of funds.
Depending upon the underlying structure, accounts may be established in the name of the relevant legal entity or in an appropriately designated fiduciary, nominee or representative capacity.

Who Uses Nominal & Segregated Accounts?
Nominal and segregated account structures are not limited to investment funds.

They may be appropriate for:

• Investment funds and investment vehicles
• Asset and investment managers
• Trustees and fiduciaries
• Family offices
• Foundations
• Special Purpose Vehicles (SPVs)
• Project companies
• Joint ventures and consortiums
• Private equity and private credit structures
• Brokers and financial intermediaries
• Paymasters
• Escrow and transaction agents
• Professional service providers
• Corporate service providers
• Real-estate and property structures
• Securitisation vehicles
• Bond and note issuers
• Security trustees and agents
• Commodity and energy transactions
• Mining and natural-resource projects
• Infrastructure projects
• Charitable and non-profit organisations
• Governmental and development structures
• Other qualifying institutions administering funds for a defined purpose or on behalf of third parties

Segregated Accounts
Segregated Accounts are designed to keep designated funds operationally separate from other monies held by the account holder.
They may be used to separate funds according to:

Client
Individual clients or groups of clients.

Beneficiary
Trust, fiduciary or beneficiary-specific monies.

Project
Funds attributable to an individual project or development.

Asset
Cash flows or proceeds associated with a particular asset.

Transaction
Funds dedicated to an acquisition, investment, financing or commercial transaction.

Investor
Subscriptions, capital contributions or distributions attributable to investors.

Purpose
Reserves, collateral, operating expenditure, capital expenditure or other specifically designated uses.

Jurisdiction or Currency
Where operationally appropriate, separate accounts may support different geographic or currency requirements.

Nominal and Nominee Structures
Certain institutional and fiduciary arrangements require an account to be operated by one legal person while funds are administered for the benefit of another person, entity or defined class of beneficiaries.

Subject to the applicable legal structure and documentation, International Finance Bank may consider designated nominal or nominee account arrangements for qualifying clients.

Typical applications may include trustees, fiduciaries, professional intermediaries, asset managers, paymasters and other authorised structures administering funds on behalf of underlying parties.

The account title, mandate, beneficial ownership information and operating authority must accurately reflect the underlying legal relationship.

Client Money and Third-Party Funds
Where a client receives, administers or distributes money belonging economically to third parties, dedicated segregation can provide an important distinction between:
the client’s own operating funds
and
funds administered for clients, investors, beneficiaries or counterparties.

Such structures may be appropriate for qualifying:

• Asset managers
• Investment managers
• Fiduciaries
• Brokers and intermediaries
• Paymasters
• Professional service providers
• Investment platforms
• Corporate administrators

Acceptance is subject to the client’s legal authority to receive or administer third-party funds and any applicable licensing, safeguarding or regulatory requirements.

Funds and Investment Structures
Investment funds remain an important application.
Dedicated accounts may be established for qualifying:

• Private equity funds
• Private credit funds
• Hedge funds
• Venture capital funds
• Real-estate investment structures
• Infrastructure funds
• Family investment vehicles
• Alternative investment structures
• Master-feeder structures
• Individual compartments or sub-funds

Depending upon the structure, separate accounts may be used for subscriptions, investments, portfolio cash, expenses, reserves, redemptions and investor distributions.

SPVs, Projects and Joint Ventures
A project or Special Purpose Vehicle frequently requires its funds to remain clearly distinguishable from those of its sponsors, shareholders, managers and related projects.

Segregated structures can support:

• Project capital
• Capital expenditure
• Operating expenditure
• Project revenues
• Joint-venture contributions
• Financing proceeds
• Reserves
• Debt-service funds
• Investor distributions
• Asset-sale proceeds

For more complex transactions, these accounts can form part of a wider Project & Structured Finance Account architecture.

Subscription and Capital Accounts
Segregated accounts may be used for the controlled receipt and administration of investor subscriptions or capital contributions.

A typical structure may follow:
Investor Funding → Receipt → Verification → Acceptance → Allocation → Investment or Project Deployment
Where the underlying investment constitutes a security, fund interest or other regulated financial product, appropriate regulatory documentation and authorisations may be required.

Paymaster and Distribution Structures
For approved transactions, segregated accounts can support the receipt and subsequent distribution of transaction proceeds to multiple entitled parties.
This may include:

• Commercial transaction proceeds
• Investment proceeds
• Project distributions
• Commission distributions
• Settlement proceeds
• Contractually determined payments

The identity and entitlement of recipients, contractual basis for payment and source of funds must be documented and capable of verification.

Security, Collateral and Reserve Structures
Dedicated accounts may also be incorporated into documented financing or security arrangements for:

• Cash collateral
• Contractual reserves
• Debt-service reserves
• Sinking funds
• Redemption reserves
• Performance-related deposits
• Other controlled cash balances

Where an account forms part of a security arrangement, the existence and perfection of any security interest depends upon the governing documentation and applicable law.

Multi-Currency Capability
International transactions frequently involve several currencies.
Subject to availability and the requirements of the underlying structure, segregated accounts may be established in supported currencies to facilitate international investments, projects, transactions and distributions.

Transparency and Reporting
Dedicated account structures provide a clearer audit trail by separating relevant transactions from unrelated banking activity.
Depending upon the account configuration, this can facilitate:

• Transaction monitoring
• Reconciliation
• Financial reporting
• Internal controls
• External audits
• Investor reporting
• Fiduciary oversight
• Compliance reviews
• Project monitoring

Compliance and Due Diligence
Nominal, nominee and segregated accounts require a high degree of transparency concerning the underlying economic relationships.
International Finance Bank may therefore require information and documentation concerning:

• Account holder
• Ultimate beneficial owners
• Underlying clients or beneficiaries
• Investors or counterparties
• Purpose of the account
• Legal and contractual relationships
• Source of funds
• Source of wealth where applicable
• Anticipated transaction flows
• Underlying assets or projects
• Regulatory status and licences
• Governing agreements
• Distribution arrangements

Accounts involving third-party funds may be subject to enhanced due diligence and ongoing transaction monitoring.

An Important Distinction
Account segregation provides operational separation and identification of funds.

It does not, by itself, necessarily create a trust, security interest, insolvency-remote structure, statutory safeguarding arrangement or proprietary right in favour of an underlying party.

The legal consequences of segregation depend upon the account documentation, contractual arrangements, capacity in which the account is held and applicable governing law.

Where specific legal protection is required, the appropriate trust, escrow, security, fiduciary or other legal structure must be separately established and documented.

A Banking Structure Built Around the Underlying Relationship
International Finance Bank does not apply a single account model to every transaction.

The appropriate structure is determined by the legal ownership of the funds, the capacity in which they are held, the underlying beneficiaries or counterparties, the commercial purpose and the required degree of operational control.

One institutional relationship may therefore incorporate several designated accounts while maintaining a coherent overall banking architecture.

International Finance Bank - dedicated banking structures for funds that must remain identifiable, controlled and clearly separated.