Citco Fund Services, the world’s leading hedge fund administrator with more than USD500bn in assets under administration, has been granted a licence by the Guernsey Financial Services Comm
Citco Fund Services, the world’s leading hedge fund administrator with more than USD500bn in assets under administration, has been granted a licence by the Guernsey Financial Services Commission to provide fund administration services in the jurisdiction.
Citco has been licensed to provide fund administration in Jersey since 2004, and says the addition of Guernsey to its service offering reflects the increasing importance of the Channel Islands as a domicile for alternative investment funds.
Says director of fund services William Keunen: ‘Guernsey is an established fund domicile with an internationally recognised but pragmatic regulatory environment which we believe will continue to make it a jurisdiction of choice for many hedge fund and fund of funds operators.’
According to the Guernsey regulator, assets under management and administration in the jurisdiction reached GBP140.4bn at the end of March, representing an increase of GBP10.2bn (7.8 per cent) since the end of 2006 and a 26 per cent year-on-year rise of GBP29bn.
Says Peter Niven, chief executive of GuernseyFinance, the promotional agency for the island’s financial industry: ‘The decision by such a world-renowned hedge fund services provider as Citco to establish a presence in Guernsey is a real boost for the island’s funds offering.
‘On the one hand, it is an endorsement of the existing environment which is attracting record flows of business, and on the other, it adds yet another facet to our administrative capabilities that should prove particularly attractive to promoters and sponsors.’
Citco, which has more than 30 years experience in hedge fund administration, currently services more than 2,000 funds and passed the milestone of USD500bn in assets under administration in April. The fund services business has more than 2,000 staff in 16 centres worldwide.
Its services include advice on the set-up and structuring of a fund, legal and corporate services, investor relations, acting as registrar and transfer agent, accounting, net asset value calculation, the production of financial statements and online reporting. The firm also offers a front-to-back system combining front-end portfolio capture and real-time position monitoring using Æxeo technology, with middle and back office operations support.
Citco has also developed a fund of hedge funds solution that includes fund administration, banking, financing, trading and custody, a comprehensive research-enabling trading platform, centralised fund of funds pricing services and a reporting service specifically developed for fund of funds.
Citco Fund Services is part of the Citco Group, an independent financial services group with 48 offices in 24 countries worldwide, comprising fund administration, banking and custody, and corporate and fiduciary advisory businesses.
Peter Niven, Chief Executive of GuernseyFinance – the promotional agency for the Island’s finance industry, said: ‘The decision by such a world-renowned hedge fund services provider as Citco to establish a presence in Guernsey is a real boost for the Island’s funds offering: on the one hand, it is an endorsement of the existing environment which is attracting record flows of business and on the other, it adds yet another facet to our administrative capabilities that should prove particularly attractive to promoters and sponsors.’
Citco has over 30 years experience in hedge fund administration and currently administers more than 2,000 funds with net assets in excess of $500bn, including five of the world’s ten largest hedge funds.
The addition of Guernsey to the Citco service offering reflects the increasing importance of the Island as a domicile for investment funds.
‘Guernsey is an established fund domicile with an internationally recognised but pragmatic regulatory environment which we believe will continue to make it a jurisdiction of choice for many funds and funds of funds operators,’ said William Keunen, Director of Citco Fund Services.
Guernsey’s funds industry continues to experience record levels of business and – propelled by the introduction of a new registered regime for closed-ended investment schemes – the value of funds under management and administration reached another new high of £140bn at the end of March. This was an increase of £10bn (8%) from the £130bn recorded at the end of 2006 – the previous high – and a rise of £29bn (26%) year on year.
The registered closed-ended investment funds regime has been in operation since 1 February this year and 8 such funds received consent in the two months to the 31 March, with a further 24 following suit in the period since to reach a total of 32.
The regime has its origins in the root and branch review of investment sector legislation that was conducted by a working party under the stewardship of leading Guernsey advocate Peter Harwood.
Central to the subsequent Harwood Report, as it was christened, was the categorisation of funds into ‘regulated’ and ‘registered’ funds. It proposed that for ‘registered funds’ the focus of regulation should be on the licensed Guernsey administrator, reducing the number and scope of funds that would be regulated directly.
To that end, the registered closed-ended funds regime introduced on 1 February shifts the burden of responsibility for reviewing the promoter and the investment manager and the prospectus or admission document from the GFSC to the proposed Guernsey licensed fund administrator.
This is a development of the Qualifying Investor Funds (QIFs) regime, which was introduced early in 2005 to significantly reduce authorisation times for funds targeting experienced investors and through which the GFSC had given consent to 95 such funds by the end of March this year.
The remainder of the proposals emanating from the Harwood Report are set to come on-stream later in 2007 and into 2008.