Guernsey Finance’s remit has grown far beyond the promotion of banking and insurance services in recent times. Recently, Guernsey’s best-known marketing organisation hosted a film seminar in London to raise awareness of a new fund that invests in film production, marketing and distribution
There is no reason to believe the film financing business will not flourish on the island given Guernsey Finance’s success in helping to create a thriving private equity environment on the island from a standing start just a decade or so ago.
Peter Niven (pictured), chief executive of Guernsey Finance, says the resources that the government, agencies and companies have devoted to creating a private equity hub have paid off. “We have concentrated on private equity as an investment type and we have succeeded in growing a niche business,” he says.
The proliferation of accountants, lawyers and administrators over a number of years has helped create a finance centre that is recognised not only in Europe, but in Asia and the Middle East too.
Unlike most international finance centres, the island has managed to attract investment managers rather than purely service providers; Guy Hands of Terra Firma and Jon Moulton of Better Capital are two high-profile residents, but others have arrived on Guernsey’s shores in recent years too.
Terra Firma and Better Capital have both now assigned a number of investment professionals to their Guernsey offices. Niven says: “Funds are actually running investments out of Guernsey, which is a new departure and a great opportunity for us. We are creating a small, high added value group of people.”
This tight-knit and experienced group of people is helping to enhance Guernsey’s reputation for corporate governance ñ an increasingly important issue for funds and their clients.
“We are increasingly getting to the situation where investors are looking for jurisdictions which can offer strong corporate governance and look after investor interests,” says Niven. “We have a good group of non-executives to provide mind and management. In essence, we have real substance here, which gives us leverage over many of our competitors around the world.”
The robustness of the Guernsey regime is starting to create momentum in emerging markets too. Emerging market fund managers are exploring the possibility of doing business via Guernsey while many Guernsey-based funds are expanding their product offering to encompass China, India and other fast-growing markets. Niven says the agency opened an office in Shanghai three years ago to explore opportunities in the Chinese market. “We have employed a local Chinese executive to open doors, provide translations and give advice to Guernsey firms that want to dip a toe in the water,” he says. Guernsey Finance also led a delegation to India in October and another to Shanghai is planned for November.
Of course, these efforts are directed at complicated and culturally different markets, so progress is likely to be steady rather than spectacular. “It is not jam tomorrow,” says Niven. “We are putting down roots to show our commitment and forge relationships. We have been there for three years and we are starting to get traction, but our time horizon for these efforts to pay off is three to five years.”
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