The Tribune

By NEIL HARTNELL

Tribune Business Editor

A BAHAMAS-based financial services provider that supervises $1.5 billion in client assets yesterday said "the timing is 100 per cent right" to open its new Switzerland office, and urged other local institutions to "seriously consider" expanding into their target markets.

Andrew Law, International Protector Group's (IPG) chief executive, told Tribune Business that he "100 per cent agreed" that Bahamas-based financial services providers needed to do "more" when it came to expanding overseas and spreading the message about what this nation's financial services industry had to offer.

Explaining that International Protector Group GmbH was being established on the back of this nation's Executive Entities legislation, and IPG's recent efforts to promote it to Swiss-based trustees, intermediaries and their high net worth clients, Mr Law said the new office demonstrated his company's "commitment" to the market and provided a contact point in the same timezone.

And, urging Bahamas-based providers to "say what we do well" more frequently when targeting markets and clients oversees, the IPG chief told Tribune Business that the Executive Entities legislation, together with last year's amendments to the Trust laws, had made this nation "the preferred private wealth management centre" in the Western Hemisphere.

"The timing is 100 per cent right," Mr Law said of the Switzerland move. "We think we have something different [Executive Entities] to tell people in Switzerland, to sell for them to use in their structures they do for their clients. Now, it's just a case of getting the message out.

"I've just spoken to one of my contacts in Bermuda, and they think people in Bermuda have now heard about the Bahamas Executive Entity. If they have any sense, they'll be looking at it to see what merits it has.

"I have to get the message out as quickly as we can. We have to push it, the Bahamas Executive Entity, because it's the first one."

International financial centres typically respond to a rival's product innovations with a similar competing tool of their own. Mr Law said it took Jersey three years to develop its own Executive Foundation after the Bahamas' launched its version, while the Executive Entity took two-three years to develop - something he described as a normal legislative/product development cycle.

IPG's Swiss operation will initially be headed up by Kevin Clerey, a longstanding colleague of Mr Law's from days when they worked together for Credit Suisse (Trust). "To try and do this without this special connection with the person who's going to head it up would be impossible," he added.

Mr Law said IPG was looking to establish a physical presence in Switzerland within 18 months of the operation's launch, as companies needed to make "the quantum leap" in terms of offices that clients could visit.

Executive Entities are designed to act as the power holder in fiduciary and wealth planning structures, resolving governance issues and giving clients greater control and security over management of their wealth.

IPG said a survey of leading trust specialists in Geneva and Zurich found 83 per cent felt the Executive Entity would be an important tool in estate planning structures. And, as it was a "power holder" and not a product designed to mitigate or reduce taxes, the Executive Entity is unlikely to offend the likes of the G-20/OECD.

"A number of people I deal with are obtaining independent legal opinions on how it can be used," Mr Law said of the Executive Entity's progress. "That's as positive as things can get...... One is obtaining legal advice on one of the benefits we put forward.

"I really hope that we will start converting inquiries into instructions to set up Bahamas Executive Entities soon, but these things always take longer than they should."

The IPG chief executive added that the Swiss office's main advantage was that it placed the company in the same timezone as clients for added convenience.

It also reinforced the company's presence in the market, and avoided the perception that it was merely a 'salesman' that came on irregular marketing trips and rarely delivered on promises to come back.

"Because we've gone to the trouble of setting up a business there, they'll say: 'You must be committed to the jurisdiction'," Mr Law said. "That's the important message we're sending out. We've made a real investment in expanding to a market we think will be really important to our business."

Asked whether more Bahamas-based financial services providers should look to expand and establish operations overseas, Mr Law replied: "Absolutely. I 100 per cent agree with that. I think there should be more of it.

"The Bahamas has a lot to offer, and institutions here should be seriously considering having a physical presence in markets that interest them. I know the Swiss market very, very well, Kevin knows the market very well, so that made it very easy to go to."

Mr Law also pointed to the example of The Winterbotham Trust Company, for whom he is chairman, and its efforts - led by head executive Geoff Hooper - to expand into Asia via its new Hong Kong office.

"He's much braver than what I'm doing," Mr Law added. "He's taken his brand, gone into the market and started afresh. Partly that is what inspired me to get on and actually do it. It can be done."

The IPG chief executive added that the Bahamas, with the Executive Entity legislation combined with the Trust law amendments passed last year, "could easily become in this timezone the preferred private wealth management centre.

"People here have to start saying: 'That's what we do well', and we'll become it. Bermuda and Cayman say what they do well, but we sit there and don't talk about what we do well. If more people talked about what we do well, it'll become self-fulfilling."

IPG currently employs nine staff in the Bahamas, and Mr Law added: "If I was ever going to be looking at another jurisdiction to expand to, it would be Asia, but that's a long way off - not for five years. We have to get Switzerland running really smoothly and profitably."