Navigating EU Banking Rules

For US expats living in Europe, maintaining financial ties to the US is essential but not always easy. Another update to European banking law is further complicating how US institutions can serve clients living across the Atlantic.

If you live within the EEA and use a European residential address on your US bank accounts, you may be receiving an unwanted letter citing Capital Requirements Directive VI (CRD VI) and stating your accounts will be closed. Here is what you need to know and some options to keep your US finances accessible.

What is CRD VI?

Adopted by the European Parliament, CRD VI (specifically Article 21c) harmonizes rules across all 27 EU member states regarding how non-EU financial institutions (“third-country undertakings”) operate within the Union. Under the regulation, banks outside the EU are prohibited from providing core banking services—specifically deposit-taking, lending, and issuing guarantees—to individuals residing in the EU unless the bank holds an authorized branch or licensed subsidiary inside the EU. The burden of compliance is placed strictly on the financial institution, not the consumer.

It is important to understand that holding accounts abroad remains completely legal for expats. However, because setting up licensed branches across the EU is prohibitively expensive, many standard US retail banks (such as Bank of America, Chase, or regional credit unions) are electing to de-risk by closing accounts or limiting services for clients who list a permanent EU residential address.

Difference Between Banking Accounts and Investment Accounts

It is important to note that CRD VI governs core banking services, not investment services.

• Banking accounts are governed by CRD VI, which applies to checking accounts, savings deposits, mortgages, and personal loans.

• Investment accounts are governed by MiFID II, which covers investment services, brokerages, trading, and asset management across Europe.

Because pure brokerage and investment accounts fall under MiFID II rather than CRD VI, for now, investment accounts with foreign addresses do not face the same strict third-country banking prohibitions being added. While US brokerages still enforce their own country-specific restrictions due to local regulations (such as restrictions on selling EU-domiciled ETFs or US mutual funds to EU residents), your investment portfolio is insulated from the deposit-taking restrictions being imposed by CRD VI.

Banking Alternatives for US Expats in France

If your current US retail bank asks you to close your checking or savings account due to your address, several cross-border solutions exist:

1. Traditional Multinational Banks: (HSBC Premier, CitiBank, BNP)

If you prefer a traditional brick-and-mortar institution, there are a handful of banks with branches on both sides of the Atlantic that offer global cross-border banking.

• These banks operate licensed entities in both the US and Europe, allowing you to link accounts across borders under a single login and move funds seamlessly.

• Accounts will need to be set up on the European side (to pass the new regulation) and options for US transfers via account/routing number should be verified before setting up an account.

• Most also carry steep qualification thresholds—typically requiring $100,000+ in total deposits/investments in the US or high monthly direct-deposit minimums to waive monthly maintenance fees.

2. State Department Federal Credit Union (SDFCU)

A more traditional brick-and-mortar institution in the US operating under a reverse solicitation exemption for Expats.

• To qualify an international individual will need to work for the US State Department, Foreign Service, or be affiliated with a non-profit advocacy organization (American Citizens Abroad (ACA), Association of Americans Resident Overseas (AARO), Democrats Abroad, etc.).

• Note these accounts will be USD only. Providing the ability to transfer money through the US ACH system (account and routing number).

3. Multi-Currency Fintechs: Wise vs. Revolut

As a lower fee option without high balance requirements, digital platforms are becoming more popular alternatives:

• Revolut now operates as a fully licensed European bank. If you register using your European address, you get a local European IBAN, deposit protection, and multi-currency capabilities. While you have the option to hold USD with Revolut, at this time you can’t set transfers using the US ACH (routing and account number).

• Wise operates primarily as a licensed Payment/Electronic Money Institution (EMI) rather than a full credit bank. It does, however, allow you to hold USD balances, provides US routing numbers for direct deposits, and transfers money between USD and EUR at mid-market rates—making it a useful tool to receive/transfer USD.

4. Brokerage Checking: Charles Schwab Investor Checking

For US expats, Charles Schwab is widely regarded as one of the most expat-friendly US brokerages thanks to its dedicated Schwab International Accounts.

• Schwab offers a high yield checking account for brokerage account clients that currently fall under MiFID II regulations. Providing unlinked cash features with no foreign transaction fees, competitive rates, and worldwide ATM fee rebates. This can become a banking alternative if desired.

• Unfortunately, Schwab will not open account for individuals in every European country, France and Italy being the most notable restrictions. Existing accounts converted upon moving abroad are usually maintained.

To find out more, get in touch with one of our advisors.