Jersey FSC Releases Fourth Quarter Statistics

by Robert Lee, Tax-News.com, London

12 March 2004

The Jersey Financial Services Commission on Tuesday published its 2003 fourth quarter statistics for the island’s finance industry, which showed a healthy increase in both banking deposits and managed funds over the course of last year.

The figures show that Jersey bank deposits fell by 4.3% during the last quarter of 2003 to £149.3 billion, although there was an increase of £9.9 billion (7.1%) during 2003 as whole. Of the total deposit base at the end of 2003, £101 billion related to customer deposits, and £48 billion to inter bank deposits.

Approximately 68% of bank deposits are held in currencies other than sterling. During 2003, there was a sharp increase (39% in US dollar terms) in the underlying value of US dollar balances, although this was partly offset by a decline in balances denominated in the Euro.

The number of banking licenses in issue as at 31 December 2003 was 55, the same as in the previous quarter.

The total number of incorporations during the last quarter was 631 which shows an increase of 30% over the corresponding period for 2002, continuing the trend from the previous quarter.

The number of 'fast track' incorporations for the quarter was 350 and the number of normal company incorporations was 281. Normal company incorporations are completed within two working days whilst fast track incorporations are completed within two hours.

The total funds under investment management (class B of the Financial Services (Jersey) Law 1998) stood at £31.1 billion as at 31 December 2003, an increase during the year of 6.9%.

Under a new system of measuring the funds sector, the JFSC now excludes from the figures the collective investment funds for which a permit was issued under the Law for the function of distributor or similar minor function. Such funds are regarded as non-Jersey funds.

The exclusion of these funds has reduced the total net asset value of funds by £47.8 billion. However, for the first time, the Island has collected statistics on the private schemes administered in Jersey, which, although not requiring a permit under the Law, require consent under the Order. The inclusion of these COBO Funds has increased the total by £23.7 billion, thus arriving at a total figure of £98.7 billion as at 31 December 2003.

At the end of 2003, the total number of clients of investment managers was 20,710, about the same as at the end of the previous quarter.

On the insurance front, during the year, 15 new Category A permits were issued, and 16 category A permits were not renewed. With regard to Category B permits, 6 were not renewed. These were all SPVs that had a pre-defined business life of three or four years. No new Category B permits were issued during the year.

Therefore as at 31 December 2003 there were 155 Category A permits in issue, and 13 Category B permits.

Commenting on the fourth quarter results, David Carse, Director General of the Commission commented: “The revised methodology for the collation of the fund statistics is considered to be a more accurate reflection of the fund business activity in the Island.”

He added: “On the old basis the value of funds increased during 2003, as did the value of assets under management. In both cases, this reflected the improvement in world financial markets during 2003. Whilst bank deposits have shown a fall over the last quarter there was a significant increase during 2003."

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