JFA Chair confident about Jersey strengths

Monday 15 June 2020

Jersey has a unique combination of assets that should position it strongly in the funds market over the short and long term, despite the challenges of covid-19, the Chair of the Jersey Funds Association has said.

In a recent virtual update, Tim Morgan pointed out that Jersey’s funds industry recorded a new record high of fund assets being administered last year (£346bn) - a figure that included a 19% year-on-year jump in private equity business in particular.

"In the first part of 2020, we continued to see a steady demand for Jersey funds, including from existing managers continuing to launch, often with larger, successor funds," the JFA Chair said.

"Just as importantly, we’ve seen a sustained strong take up of the Jersey Private Fund, with managers converting to the structure and a growing number of smaller, start-up and spin-out managers opting for it too where the JPF's scalability and cost effectiveness, combined with Jersey's opt in approach for EU marketing, makes it a particularly strong choice for new structures.

"There are now more than 350 JPFs, which is a hugely positive story and a great endorsement of Jersey’s reputation as a specialist centre for alternatives.”

In addition, Mr Morgan highlighted some key findings from a recent survey of JFA members, which revealed a widespread positivity around key issues such as Brexit.

Looking to the future, he highlighted that Jersey’s strengths in alternatives would position it ideally against global market trends, with PwC Market Research Centre forecasting growth of almost 9% across the asset classes over the coming five years.

“Our core strengths as an alternative funds centre, particularly across private equity, real estate, infrastructure and credit funds remain the same – our stability, experience, expertise, service levels, cost-effectiveness, legal framework, tax transparency and regulatory standards.

"However, competition from other centres remains strong and the regulatory environment remains highly complex, so we need to keep innovating and adapting to meet the needs of alternative fund managers.

“To that end, we are focused on enhancing our range of structuring options, and we are focused on promoting our capabilities in the ESG space. We’re also anticipating a rise in co-investment and fund finance activity, a resurgence in the use of Jersey property unit trusts to facilitate investment into the real estate market, and opportunities in outsourced work as managers look for specific support expertise such as governance and compliance, areas where Jersey excels.”