Offshore Banking and the Limits of Regulation

In her talk, “Exit through the giftshop: the size and structure of offshore banking,” Andrea Binder examined the scale and structure of offshore banking as a central component of the global financial system. Offshore banking, she argued, enables money creation beyond national regulation, allowing private actors to circumvent public rules and underpinning a wider range of offshore financial practices, including tax planning and sanctions evasion.

Drawing on economic history, interviews with market participants, and data from the Bank for International Settlements (BIS), the presentation showed that offshore banking constitutes a system of considerable size—rivaling key segments of regulated cross-border finance.

The findings also challenge common assumptions about its geography: rather than being driven primarily by non-Western markets, offshore banking remains deeply rooted in Europe. Overall, the research highlights both the resilience of offshore finance and the extent to which pressures on the rules-based international financial order emerge from within.