£160 billion of pensions funds assets are invested in Jersey

Wednesday 15 November 2017

£160 billion worth of pension fund assets are invested through Jersey, including £39 billion in fund structures and £120 billion in corporate vehicles, according to new research published by Jersey Finance.

The research was conducted by independent economic consultancy firm, Europe Economics, to look at how Jersey supports and facilitates the management of pension funds and other institutional assets, such as endowment funds and sovereign wealth funds.

The report also found that:

• a total of £52bn of funds under administration in Jersey is attributable to tax-exempt institutional investors, and the focus of that institutional fund business is overwhelmingly on pension funds, accounting for almost four-fifths (79%) of the total;
• 46% (£18 billion) of pension fund assets in Jersey originate from the EU (excluding the UK), including the Netherlands, France, Denmark and Germany. Another 13% (£5 billion) comes from the UK, less than 10% (£4 billion) is from North America, and 32% (£12 billion) originates from the rest of the world.
• Most of the institutional investment administered in Jersey (60%) is invested in private equity and venture capital, with around 19% invested in real estate. Bonds, equities, mixed and money market instruments account for 7%

The research also consulted Jersey-based lawyers and administrators who service funds and corporate structures. It found that having a proportionate regulatory regime such as Jersey’s - which helps to create a more competitive market- was deemed by 62% respondents to deliver a "high level of benefit."

Jersey’s access to a skilled labour force, meanwhile, was also considered highly beneficial by 40% of respondents.

Pictured: Geoff Cook, CEO of Jersey Finance.

Geoff Cook, CEO of Jersey Finance, commented on the findings: “It is wonderful to see research like this, which really quantifies the clear, positive impact Jersey can have on the futures of people all over the world, supporting them in their retirement. It shows the scale of what is possible from working with institutional investors, and makes clear how vital the work done here on the Island is.

“It also highlights that this work is truly global. The pension funds housed through Jersey, for instance, represent around 60 million people around the world – possibly many more. It reflects the beneficial contribution Jersey makes to economies and societies worldwide.”

Ross Dawkins, Principal at Europe Economics, the economic consultancy, said: “This research helps explain how tax neutrality plays a vital role in supporting institutional investment. For institutional investors who make cross-border investments into non-tax neutral countries, creating tax transparent vehicles can be complex and costly. Investing through a tax neutral International Finance Centre like Jersey avoids these complications. It makes it easier to make cross-border investments, creates more diversified portfolios, and delivers better returns. Ultimately, this benefits everyone – especially the people on the street who rely on their pension.”

The full ‘Jersey for Institutional Investment’ report can be found here.