The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Key international intermediaries believe the Bahamas is “incredibly well-positioned” to grow its financial services business, but want this nation to maintain a more “visible” presence in key global markets.

Aliya Allen, the Bahamas Financial Services Board’s (BFSB) chief executive, yesterday acknowledged this nation’s financial industry “need to be there more” when it came to maintaining a consistent presence in global markets, but said she had “every confidence” this would happen.

Speaking to Tribune Business about the main ‘takeaways’ from the BFSB’s recent Landfall promotional trips to London and Switzerland, Ms Allen said many of the key financial intermediaries - attorneys and accountants who direct where large blocks of high net worth client business are placed - indicated a desire to forge closer working relationships with Bahamian attorneys and financial practitioners.

Describing the overall feedback from attendees at the Landfall events as “extremely positive”, Ms Allen said the newly-developed Executive Entity product was going to “provide a real advantage to the Bahamas”, as it would both simplify wealth management structures and reduce associated administration costs.

And she added that there was “a lot of interest” in the Bahamas’ ambitions to establish an International Arbitration Centre, with maritime and trust issues potential niche markets in this area.

“The main takeaway is that the Bahamas has positioned itself incredibly well, and has a strong reputation internationally,” Ms Allen told Tribune Business of the feedback received from the London and Swiss promotions.

“We’re not one of those jurisdictions that sprung up overnight; we show a strong history of providing structures, private wealth management. Our heritage is incredibly important.”

Another factor in the Bahamas’ favour, the BFSB chief executive added, was its position as an independent, sovereign nation able to determine its own financial policies. This differentiates itself from key Western Hemisphere international financial centre rivals, especially the Cayman Islands and Bermuda, which remain UK dependencies.

The Executive Entity, as a product, received heavy focus during both the Swiss and London Landfalls, and Ms Allen said once clients and its advisers became “comfortable” with its flexibility, role and usages, it would give the Bahamas a further competitive advantage in its private wealth management niche.

“No product is ever taken up immediately,” Ms Allen told Tribune Business. “When we introduced the Foundations legislation in 2003, it took a few years before we got the ball really rolling in terms of registrations. There’s going to be a time period with people getting comfortable.”

But, once this settling in period was over and intermediaries/clients “realise its flexibility”, Ms Allen said of the Executive Entity: “It’s going to provide a real advantage to the Bahamas in terms of having that structure that decreases administrative costs, peeling away layers of administration and simplifying wealth structures.”

Explaining that clients increasingly did not want complex wealth management structures involving numerous companies, the BFSB chief said: “Apart from being expensive, it opens them up to scrutiny.”

Apart from the Executive Entity, there was also “a lot of interest” in the Bahamas’ International Arbitration Centre ambitions, with Ryan Pinder, minister of financial services, raising the issue frequently during meetings he had with international attorneys during the London Landfall.

However, another message coming from the European trip was that the Bahamian financial services industry needed to maintain a more visible, consistent presence in the marketplace.

Ms Allen said BFSB’s marketing strategy had always been to target key intermediaries that directed where business was placed, hence the focus on London, which is “the hub” for structure and asset management advice.

Switzerland, given its strong ties to the Bahamas through its significant bank and trust company presence, was also a natural target.

“We felt it was important to go back to Europe, and we have not been there for three years, at least not in a focused and dedicated fashion,” Ms Allen said.

“They’d, the intermediaries, like to get to know our service providers more. ‘Just don’t do one, keep coming back’. They actually did say they would like to be able to develop the kind of relationships with the lawyers that they have in other jurisdictions.

“It’s not that we have huge issues; it’s a matter of visibility. I do think we’ve done a lot at BFSB, under Wendy Warren, who did an amazing job in promoting the jurisdiction, and the private sector has really supported the BFSB and the Government.”

Ms Allen said the last several years had “been very difficult” for financial institutions to focus on promoting/marketing the industry, given the impact various regulatory changes were having on business models.

She added, though, that marketing was “a very necessary part of our industry”, and conceded: “I do think we need to be there more, but I have every confidence this will happen.”

Mr Pinder had indicated that the Ministry of Financial Services would return to London to further build intermediary relationships and “gain visibility”.

Still, Ms Allen told Tribune Business that the size of the Bahamian delegations - 14 in Zurich, which increased to 20 in Geneva and 27 in London, showed there was optimism about the financial services industry’s future prospects.

“I think it’s an indication that, despite the challenges that are present domestically and internationally, there is a bit of a positive outlook on where the Bahamas could be headed,” Ms Allen told Tribune Business.

“There will always be people predicting doom and gloom for the industry, and I’m not saying there are not valid concerns, and that there are not things we could be doing better, but I think it’s a positive indication of how the industry views the Bahamas.”