The move by BlueCrest Capital Management, one of Europe’s largest hedge fund managers, to shift its headquarters from London to Guernsey has encouraged industry members who see signs that asset management activity in the island is set to grow.
They say active wealth management operations have been carried out in Guernsey for many years and the trend toward actually basing asset management there is being encouraged by increased regulatory scrutiny of the investment management business as well the island’s attractiveness as a jurisdiction.
“Serious businesses are being attracted to Guernsey, and as an island we should be enormously heartened by this,” says Paul Meader (pictured), head of portfolio management at Collins Stewart.
He also notes that Shore Capital, a boutique investment bank with an alternative asset management arm, also moved its corporate head office to Guernsey in recent months, while private equity firm Terra Firma has expanded its existing presence in the island.
“For a number of years there has been quite a vibrant investment management community, though Guernsey hasn’t tended to shout about it,” adds Meader, formerly chief executive of boutique asset and wealth manager Corazon Capital, the former Dawnay Day Milroy business, which was acquired by Collins Stewart in March.
“It’s about good performance and adapting services suited to the client’s needs. There’s a growing demand for this kind of service, and one of the reasons that we at Corazon were attracted to Collins Stewart was that it has true investment decision-makers here and in Jersey.
“Geographical proximity makes for better relationships. Managers based in the jurisdiction understand nuances that those outside may not. The key to successful delivery of asset management is international expertise and perspective, and local –but not parochial – presence.”
A number of administrators have also recently established or expanded their presence in the island. In June custody and fund services provider J P Morgan Worldwide Securities Services announced it would acquire the private equity administration business of Schroders, including its Guernsey operation.
Bank of New York Mellon has established BNY Mellon Fund Services in Guernsey to develop its private equity servicing capability. The office will be run in partnership with International Administration Guernsey, a local firm specialising in administering private equity, real estate and other alternative funds.
“We have seen several new entrants to the Guernsey market in recent months, including some major global players,” says Peter Niven, chief executive of promotional agency Guernsey Finance.
“This really is a significant endorsement and shows confidence in the island’s continued position as a leading fund domicile, and in particular our experience and expertise in the alternative and more niche asset classes like private equity. I am extremely hopeful that we will see more heavyweight names establishing in Guernsey during the coming months.”
The new arrivals join a diverse array of administrators ranging from global giants to boutique providers that have built a presence in Guernsey in recent years, including Alter Domus, BNP Paribas, Capita, Citco, Custom House, PPF Partners and State Street.