15th December 2009
Stabilisation in banking and movements in funds market affect third quarter results
The level of specialist funds business in Jersey has shown an increase during the third quarter of 2009, although overall funds business has decreased. Banking deposits however, have remained relatively stable compared with recent quarterly reports.
Bank deposits have decreased by only 2% during the third quarter from £174.6 bn to £170.6 bn. The net asset value of funds under administration is down from £198 bn last quarter to £163 billion in the third quarter, although most of this decrease is pinpointed to one fund promoter firm which has re-structured some of its business.
Specialist funds, including private equity and venture capital, hedge and real estate have shown increases over the quarter ranging from 9% to 12.9% over the figures for the previous quarter, even though the overall value of funds under administration has declined.
The statistics collated and prepared by the Jersey Financial Services Commission for the period ending September 30th 2009, also show that while the number of funds created was down by 2.6%, company formations were up 17% and the value of funds under investment management increased by 7.4% during the same period.
The headline figures from the statistics are as follows:
· Banking deposits decreased by £3.6 bn (-2%) during the third quarter of 2009 from £174.2 bn to £170.6 bn.
· The Net Asset Value (NAV) of funds under administration decreased by £35 bn (-17.7%) during the last quarter from £198 bn to £163 bn. The total number of funds decreased by 35 (-2.6%) from 1,322 to 1,287.
· The value of funds under investment management increased by £1.3 bn (7.4%) from £17.6 bn to £18.9 bn during the third quarter of 2009.
· Company formations were up 17% compared to Q2 2009. The total number of live companies on the register decreased by 624 during the last quarter from 33,811 to 33,187.
Geoff Cook, chief executive, Jersey Finance Limited, commented:
“As anticipated, banking deposits have remained relatively stable during the third quarter of 2009, once again demonstrating the attractiveness of Jersey as a banking centre in uncertain times. Whilst the reduction in the headline figure for funds is disappointing from a marketing perspective, there is minimal impact from this change in economic terms. The reduction in the figures is directly attributable to a large promoter taking the decision to restructure certain functions carried out in relation to its funds. As a result, certain functions that were previously being performed for the promoter’s non-Jersey funds have been transferred out of Jersey. This is not reflective of Jersey’s strong fund offering and has no effect on levels of employment nor on the profitability of our funds business. Without this one off adjustment the overall fund performance would have been marginally positive, with increasing numbers of new fund enquiries being received and specialist funds business showing an increase.
“Overall, despite a difficult and challenging climate this year, Jersey has enhanced its reputational standing as a leading international finance centre with ringing endorsements for the quality of its financial services from bodies such as the IMF, STEP, the Global Financial Centres Index and OECD. These results do however highlight the need for Jersey to continue to market itself vigorously in a very challenging and competitive market place.”
For further information, please contact