New figures show that the value of investment fund business in
Guernsey grew by £6.2 billion (2.4%) during the first quarter
of this year.
The increase represents the seventh consecutive quarter of
growth and takes the net asset value of funds under management and
administration in the Island to a new record high of £263.6
billion at the end of March 2011. This is a rise of £66.2
billion (33.6%) compared to the end of March 2010.
Peter Niven, Chief Executive of Guernsey Finance – the
promotional agency for the Island's finance industry
internationally, said: "We are continuing to build very
positively on the exceptional growth during 2010 to start this year
with a further, if slightly slower, increase in the value of funds
business carried out in the Island. It was always going to be
difficult to sustain the rates of increase experienced last year
but the fact that we have maintained the upward trend and now
recorded seven consecutive quarters of growth shows the strong way
in which our funds industry has bounced back from the financial
crisis. These figures are the latest in a number of positives at
play during the last few months and this is very encouraging for
the future of Guernsey's funds sector."
The new figures from the Guernsey Financial Services Commission (GFSC)
show that Guernsey domiciled open-ended funds reached a net asset
value of £57.6 billion at the end of March, which was a
decrease of £0.3 billion (0.6%) during the quarter but an
increase of £1.5 billion (2.7%) year on year.
The Guernsey closed-ended sector was valued at £114.8
billion at the end of March – up £5.3 billion
(4.8%) during the first three months of 2011 and rose £22.5
billion (24.4%) compared to twelve months earlier.
Non-Guernsey schemes, where some aspect of management,
administration or custody is carried out in the Island, increased
by £1.2 billion (1.3%) during the quarter to reach
£91.2 billion at the end of March 2011, which is £42.2
billion (86.1%) higher than the value at the end of March 2010.
Patrick Firth, Chairman of the Guernsey Investment Fund Association (GIFA),
said: "The figures are an endorsement of Guernsey as a
jurisdiction for the administration of a diverse range of funds.
All three categories, open-ended, closed-ended and non-Guernsey
schemes have stood up well which is extremely encouraging coming on
the tail of significant increases in 2010. This really does
illustrate the strength of Guernsey's funds industry at the
moment and we will be looking to sustain this momentum during
Mr Niven highlighted that the figures follow hot on the heels of
Guernsey being given the green light for its companies to list on
the Hong Kong Stock Exchange (HKEx); data from the London Stock
Exchange (LSE) showing that there are more Guernsey companies and
securities listed on its markets than there are entities from any
other competitor jurisdiction; a survey from Private Equity News /
State Street showing that 61% of Chief Financial Officers (CFOs)
prefer Guernsey as their destination of choice for private equity
outsourcing; and a very successful Guernsey Funds Forum in London
which attracted more than 300 delegates.
He added: "Taken together, these developments show the
extremely high regard in which our investment sector is held
internationally. Guernsey Finance will be continuing to work with
industry to ensure that we press home these very positive messages
to key decision makers not just in the City of London –
traditionally our principal source of new business – but
also in the emerging markets such as China, India and Russia. There
are plenty of reasons to be optimistic for the future however we
must not rest on our laurels but continue to drive forwards to
ensure that the Island retains its place as a leading international
Mr Niven also believes that Guernsey has benefited from the
greater certainty provided by the framework agreement for the
EU's Alternative Investment Fund Managers (AIFM) Directive. He
adds that there is much work still to do in relation to the details
of Directive but the continuing efforts of government, industry and
regulator mean that Guernsey is well positioned.
The gross asset value of all Guernsey and non-Guernsey schemes
increased by £1.6 billion (0.5%) during the first quarter and
£66.2 billion (29%) year on year to reach £292.4
billion at the end of March 2011.
Within the asset management and stockbroking sector, 106
respondents confirmed gross assets under management of £78.4
billion at the end of March. This is a rise of £2.9 billion
(3.8%) during the quarter and £27.5 billion (54%) during the
previous twelve months.
Probably the most significant change from previous practice in Guernsey law under the Companies (Guernsey) Law 2008, which came into effect on the 1 July 2008, was the consignment to history of the concept of capital maintenance, which was discarded in favour of a solvency model as the basis of a company’s ability to pay distributions and dividends.
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