The total value of funds business in Guernsey has risen again with the latest figures from the Guernsey Financial Services Commission confirming a growth of GBP1 billion in the three months to the end of 2017.
The latest figure of GBP270 billion also represents an increase of approximately GBP14 billion (5.6 per cent) over the previous 12 months and a third consecutive year of growth for Guernsey’s fund sector.
Guernsey’s financial services regulator approved 18 new investment funds during Q4, of which 17 were closed-ended and the remaining one open-ended, a big increase of 44.4 per cent on Q3’s 10 new funds.
Guernsey Finance Chief Executive Dominic Wheatley (pictured), is encouraged to see both quarterly and annual growth in the latest figures, particularly seen in a rise in administration being carried out locally for non-Guernsey schemes.
“Whether the quarterly figures are going up or down, the best indication of a jurisdiction’s stability is to look at the longer-term trend, and so to look at the statistics and see the total net asset value of funds in Guernsey on the rise in both the short and longer term is indicative of a stable environment,” says Wheatley. “With so much uncertainty in the world, it’s good to see Guernsey continue to be a location of choice for many fund managers, particularly those who are familiar with the environment.
“The local administration of non-Guernsey schemes demonstrates substance the island has developed over many years, and it is paying dividends.
“An increase in new funds suggests, as predicted, that managers from all around the world are hedging against potential Brexit issues and Guernsey is providing answers to the uncertainty.”
Open-ended funds decreased by 1 per cent over the quarter to GBP166.4 billion, but still achieved annual growth of GBP1.2 billion (2.8 per cent). Closed-ended funds increased over both the quarter (0.26 per cent to GBP166.4 billion) and the year (4.46 per cent to GBP7.1 billion).
Non-Guernsey schemes – funds not domiciled in the island but with some aspect of their management, administration or custody carried out locally – grew by GBP1.4 billion (2.3 per cent). An increase of GBP6.1 billion (11.31 per cent) since 31 December 2016 values them at GBP60.4 billion.
Real estate funds were the biggest mover, with the net asset value showing a year-on-year increase of 42 per cent to nearly GBP21 billion, boosted by a strong Q4. There was also an increase of 8.89 per cent in the number of real estate funds over the year, from 90 at the end of December 2016 to 98 at the end of December 2017.
Guernsey Investment Fund Association Chairman Paul Smith welcomes the figures.
“I am optimistic about 2018. The mood in the industry has been positive in the early part of the year and I look forward to seeing that coming through in the statistics throughout the year,” he says. “The figures show that Guernsey is still the jurisdiction of choice for a wide range of asset classes and the increasing administration of non-Guernsey schemes is evidence that Guernsey is able to provide real substance for fund managers that may be lacking elsewhere. We are continuing to work on further diversification in the type of funds that are established in Guernsey and the already numerous markets in which Guernsey funds can be promoted.”
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