Solid and stable remain watchwords for Jersey’s finance industry in third quarter of 2013

Jersey’s finance industry reported another comparatively solid and stable performance in the third quarter of 2013, with marginal decreases in the values of its banking and funds sectors, caused in part by a weakening in the value of foreign currencies against Sterling, and an uptick in fund and company formation activity.

Jersey’s finance industry reported another comparatively solid and stable performance in the third quarter of 2013, with marginal decreases in the values of its banking and funds sectors, caused in part by a weakening in the value of foreign currencies against Sterling, and an uptick in fund and company formation activity.

In the third quarter of 2013, bank deposits held in Jersey decreased by around 3.7% to stand at £145.2bn, with foreign currency deposits representing around 64% of that total. Deposits emanating from the Middle and Far East continue to represent around 18% of the total value of deposits in Jersey.

Currency movements also affected the funds sector, with the net asset value of funds administered in Jersey decreasing by 3.2% from £201.3bn to £194.8bn. The alternative investment funds sector continues to make up around 70% of the total value of funds under administration, while the number of newly formed regulated and unregulated funds increased slightly. 

Meanwhile, there were 667 company incorporations in the third quarter of 2013, a quarterly increase of 235, with 33,272 live companies on Jersey’s company register, the highest number since September 2010.

The latest statistics, collated and prepared by the Jersey Financial Services Commission, are for the three month period ending 30^th September 2013. Headline figures across all sectors of the industry include:

• The total value of banking deposits held in Jersey decreased by 5.6bn from £150.8bn to £145.2bn during the third quarter of 2013.
• The net asset value of funds under administration decreased by £6.5bn from £201.3bn to £194.8bn during Q3 2013.  The total number of regulated funds increased by 11 from 1,337 to 1,348 over the same period. The total number of unregulated funds increased by 4 from 189 to 193 during the quarter.
• The value of total funds under investment management decreased by £0.7bn from £22.5bn to £21.8bn during the third quarter of 2013.
• The total number of live companies increased by 235 to 33,272 at the end of Q3 2013. 

Geoff Cook, Chief Executive of Jersey Finance, commented: 

“The total value of banking deposits saw a slight decrease during the third quarter of 2013.  Due to currency movements, the sterling equivalent value of foreign currency denominated deposits decreased by around £3.6 billion. 

“For the funds sector, the total number of funds increased, while the decrease in the net asset value (NAV) of funds under administration can be linked to currency movements. The £6.5bn drop in the NAV over the quarter can be explained by the weakening of the US Dollar and the Euro against Sterling - approximately half of the total NAV is US Dollar denominated and one fifth is Euro. Foreign currency movements had a negative effect on the NAV of £8bn, however some of this was offset by market growth over the period, resulting in an actual reduction of £6.5bn. The investment management sector also reported stable performance showing a modest £0.7bn decrease.  

“Overall, the figures highlight a stable picture for Jersey and our focus remains on developing new business opportunities.  In the short term we are particularly keen to work with fund managers that are looking for a flexible solution outside the AIFMD. This is particularly relevant for funds with more challenging asset classes. Jersey is also the first third country to offer a fully compliant AIFMD regime, which further enhances the flexibility of our range of funds products.”