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Press Release - 10 March 2005

The Jersey Financial Services Commission has today, 10 March 2005, issued its quarterly report for the period 1 October 2004 to 31 December 2004.

Headlines:

Bank deposits increased by £8.9 billion during 2004 to £158.1 billion.

The value of collective investment funds managed in the Island ended 2004 at £104.1 billion, an increase of £1.6 billion over the 2003 year-end figure.

The number of collective investment funds and COBO funds rose during 2004 from 602 to 833.

The total value of funds under management (Class B of the Financial Services (Jersey) Law 1998) stood at £34.4 billion as at 31 December 2004. The increase in funds under management during 2004 was £3.3 billion (10.6%).

Company incorporations for the whole of 2004 totalled 2439, an increase of 13.1% over 2003.

Bank Deposits

There was a decrease in Jersey bank deposits during the quarter of 0.64% (£1.0 billion). The main reason for this was a drop in the reported sterling equivalent of the foreign currency on deposit with Jersey banks. Although during the quarter there was actually an increase in the amount of foreign currency placed on deposit, the aggregate reported sterling equivalent fell due to a substantial weakening in the US Dollar during the quarter (the majority of the Island’s currency deposits are in US Dollars).

The 2004 year-end deposits figure was £158.1 billion (see Appendix A); this represents an increase of £8.9 billion (5.96%) during 2004.

32.5% of bank deposits are held in sterling and 67.5% are held in currencies other than sterling (see Appendix B).

During the last quarter of 2004, the number of banking licences dropped from 55 to 51. This drop was the result of licences issued to certain Cayman-based banks, which invoked disaster recovery plans following the impact of Hurricane Ivan (as referred to in the September 2004 quarterly report), being relinquished.

The number of banking licences at 31 December 2003 was 55. The drop to 51 by the end of 2004 is a reflection of consolidation in the banking sector.


Figure 1

BANK DEPOSITS
(£ BILLION) AS AT 31 DECEMBER FOR EACH OF THE PAST FOUR YEARS


Funds

The Collective Investment Funds (Jersey) Law 1998 (the “Law”)
The Control of Borrowing (Jersey) Order 1958 (the “Order”)

The year-end fund figures showed an overall Net Asset Value (“NAV”) increase of 7.5% for the quarter. While all types of funds had increases in the quarter, it was the specialist type funds, such as Venture Capital, Real Property and Hedge Funds, which have shown the largest gains. As a percentage of the NAV of all funds in Jersey, specialist type funds now account for 45% compared to 26% at the end of 2003. Thus, while Jersey’s biggest sector, by value, continues to be Equity Funds, Venture Capital, Real Property and Hedge Funds grew significantly in 2004. This demonstrates Jersey’s growing importance in these niche markets.

Appendices C, D and E provide more analysis of fund statistics.

 

Company incorporations

The total number of incorporations during the December quarter was 620, an almost identical figure to that in the corresponding quarter of 2003.

Incorporations for the whole of 2004 totalled 2439 an increase of 13.1% over 2003. The increase was primarily due to changes in UK legislation relating to stamp duty which came into force during the year, and increased business activity in the Island.

The number of ‘fast track’ incorporations for the quarter was 258 and the number of normal company incorporations was 362. (See Notes to Editors.)

During 2004, against their self-imposed target of 95%, the Registry recorded a 98.8% rate for normal two-day incorporations and a 97.3% rate for fast track incorporations. (See Notes to Editors.)

Figure 2 illustrates the number of new company incorporations during each of the past four years. (See also Appendix F.)

 

Figure 2

TOTAL NEW COMPANY INCORPORATIONS DURING THE YEAR FOR
THE PAST FOUR YEARS


 

Investment Business

Total funds under management (Class B of the Financial Services (Jersey) Law 1998) stood at £34.4 billion at 31 December 2004.

The comparative figure for 31 December 2003 was £31.1 billion. The increase in funds under management during 2004 was therefore £3.3 billion (10.6%).

As at 31 December 2004, the total number of clients of investment managers was 19,989.

Insurance Business

The total number of insurance licences at 31 December 2004 stood at 164, of which 152 were Category A and 12 Category B (see Appendix G).

The equivalent figure at 31 December 2003 was 168. The main reason for the net fall of 4 licences during 2004 was because a number of licences were no longer needed as a result of consolidation in the Industry.

 


Figure 3

ALL INSURANCE LICENCES AS AT 31 DECEMBER FOR EACH OF THE PAST
FOUR YEARS

Conclusion

David Carse, Director General of the Commission, commenting on the quarterly statistics said today, ”The increase in business volumes in all sectors during 2004 reflects the improving global economy and the continuing confidence that investors and financial services businesses have in Jersey.“

For further information:

David Carse
Director General
Jersey Financial Services Commission

Telephone: +44(0) 1534 822011
Facsimile: +44(0) 1534 822001
Email: to Mr Carse's PA: l.johns@jerseyfsc.org

 

Notes to Editors:

1. Normal company incorporations are completed within two working days whilst fast track incorporations are completed within two hours.

2. Published timescales were introduced the week commencing 1 January 2000, and the Registry has worked to those targets throughout the last year.

Appendix A

Annual growth in Banks and Bank Deposits to date. £ Billions

DATE NO OF BANKS STERLING CURRENCY TOTAL
31 Dec 1999 77 37.883 70.522 108.405
31 Mar 2000 73 39.250 69.992 109.242
30 Jun 2000 73 40.862 74.217 115.079
30 Sep 2000 73 38.933 77.001 117.934
31 Dec 2000 74 39.827 77.423 117.250
31 Mar 2001 70 41.227 80.949 122.176
30 Jun 2001 70 42.377 83.250 125.897
30 Sep 2001 70 42.115 86.955 129.069
31 Dec 2001 64 44.057 88.116 132.173
31 Mar 2002 61 43.324 91.716 135.041
30 Jun 2002 62 43.136 89.307 132.443
30 Sep 2002 62 43.213 93.269 136.482
31 Dec 2002 59 47.489 91.840 139.329
31 Mar 2003 55 47.688 107.931 155.619
30 Jun 2003 55 47.414 109.008 156.421
30 Sep 2003 55 47.538 108.256 155.794
31 Dec 2003 55 47.307 101.945 149.252
31 Mar 2004 51 49.877 105.821 155.698
30 Jun 2004 51 49.923 107.717 157.640
30 Sept 2004 55 50.707 108.464 159.171
31 Dec 2004 51 51.366 106.783 158.149

 

Appendix B

ANALYSIS OF DEPOSITS - 31 DECEMBER 2004
ALL AMOUNTS IN £ THOUSANDS

RESIDENCE OF DEPOSITORS
Sterling
Currency
Total
Jersey Resident Depositors
6,234,708
2,419,981
8,654,689
Jersey Financial Intermediaries etc
4,496,880
4,365,935
8,862,815
U.K., Guernsey & I.O.M. + unallocated Jersey,UK etc
24,149,013
19,133,142
43,282,155
SUBTOTAL
34,880,601
25,919,058
60,799,659
Other EU Members
3,289,545
12,389,661
15,679,206
European Non EU Members
4,641,969
34,409,362
39,051,331
Middle East
931,731
6,554,449
7,486,180
Far East
2,171,734
5,523,370
7,695,104
North America
2,038,411
18,450,413
20,488,824
Others, Unallocated non Jersey,UK etc
3,412,099
3,536,978
6,949,077
SUBTOTAL
16,485,489
80,864,233
97,349,722
OVERALL TOTAL OF DEPOSITS
51,366,090
106,783,291
158,149,381

 

PERCENTAGE OF TOTAL
Sterling
Currency
Total
Jersey Resident Depositors 3.9% 1.5% 5.4%
Jersey Financial Intermediaries etc
2.8% 2.8% 5.6%
U.K., Guernsey & I.O.M. + unallocated Jersey,UK etc
15.3% 12.1% 27.4%
SUBTOTAL
22.0% 16.4% 38.4%
Other EU Members
2.1% 7.8% 9.9%
European Non EU Members
2.9% 21.8% 24.7%
Middle East 0.6% 4.1% 4.7%
Far East 1.4% 3.5% 4.9%
North America 1.3% 11.7% 13.0%
Others, Unallocated non Jersey,UK etc 2.2% 2.2% 4.4%
SUBTOTAL
10.5% 51.1% 61.6%
TOTAL
32.5% 67.5%  

 

Appendix C

COLLECTIVE INVESTMENT FUNDS (JERSEY) LAW 1988 ("THE LAW")
CONTROL OF BORROWING (JERSEY) ORDER 1958 (THE "ORDER")

SUMMARY OF STATISTICAL SURVEY OF FUNDS SERVICED IN JERSEY AS AT 31 DECEMBER 2004

From 1 October 2003 we have excluded 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. However, we now collect statistics on the private schemes administered in the Island, which, although not requiring a permit under the Law, require consent under the Order (such funds are termed “COBO funds”). Funds regulated under the Law are referred to herein as “CIFs”.

Date
Total NAV
£ Millions
Number
of Funds
Total No.
of Separate Pools
31 Dec 2003
102,521
602
2,142
31 Mar 2004
99,561
686
2,072
30 June 2004
98,227
678
2,124
30 Sept 2004
96,883
769
2,208
31 Dec 2004
104,110
833
2,214

 

COLLECTIVE INVESTMENT FUNDS (JERSEY) LAW 1998
CONTROL OF BORROWING (JERSEY) ORDER 1958

SUMMARY OF STATISTICAL SURVEY OF FUNDS SERVICED IN JERSEY AS AT 31 DECEMBER 2004

ANALYSIS OF CIFS AND COBO FUNDS

Date
Fund Type
Open / Closed
Number of Funds
Total No. of Separate
Pools
Total NAV £ Millions
31 Dec 2004
CIFs
Closed
204
273
25,045
31 Dec 2004
CIFs
Open
379
1,668
60,722
CIF Sub Total:
583
1,941
85,767
31 Dec 2004
COBO Funds
Closed
208
225
16,276
31 Dec 2004
COBO Funds
Open
42
48
2,067
COBO Sub Total:
250
273
18,343
Quarter Total:
833
2,214
104,110

 

Appendix D

CIFs & COBOs

Analysis by Investment Policy Code

Investment Policy
Number of Single Class Funds
Number of Umbrella Sub-funds 
Sales £ Millions
Repurchases £ Millions
NAV £ Millions
B01 - Bond-Global
5
61
367
372
3,789
B02 - Bond-UK Debt
3
24
57
105
2,106
B03 - Bond-US Debt
0
31
331
476
5,080
B04 - Bond-Europe
3
24
157
152
3,597
B05 - Bond-Other
8
25
236
169
4,632
Sub Total Bond    
19
165
1,148
1,274
19,204
E01 - Equity-UK
19
26
227
215
4,364
E02 - Equity-Europe (Including UK)
3
32
149
337
2,912
E03 - Equity-Europe (Excluding (UK)
11
17 
216
239
2,417
E04 - Equity-US (North America)
4
36
364
286
3,606
E05 - Equity-Japan
4
14
129
125
1,232
E06 - Equity-Far East (Including Japan)
1
11
15
44
507
E07 - Equity-Far East (Excluding Japan)
5
13
48
59
787
E08 - Equity-Global Emerging Markets
8
5
42
26
642
E09 - Equity-Global Equity
25
94
787
715
8,058
E10 - Equity-Other
35
80
935
868
4,356
Sub Total Equity    
115
328
2,912
2,914
28,881
X01 - Mixed-Mixed Equity and Bond
67
174
318
427
6,710
Sub Total Mixed    
67
174
318
427
6,710
M01 - Money Market-Sterling
3
17
267
423
1,054
M02 - Money Market-US Dollar
1
15
169
263
563
M03 - Money Market-Euro
0
13
96
80
564
M04 - Money Market-Swiss
0
5
8
6
240
M05 - Money Market-Other
0
8
4
3
59
Sub Total Money Market    
4
58
544
775
2,480
S01 - Specialist-Venture Capital/Private Equity-Emerging Markets
9
0
26
2
147
S02 - Specialist-Venture Capital/Private Equity-Other
141
10
44
12
8,484
S03 - Specialist-Real Property
70
11
304
19
12,367
S04 - Specialist-Derivatives
1
0
2
1
8
S05 - Specialist-Traded Endowment Policies
40
31
325
36
1,174
S06 - Specialist-Hedge/Alternative Investment Funds
204
701
3,162
1,588
20,980
S07 - Specialist-Other
24
41
172
472
3,675
Sub Total Specialist    
489
794
4,035
2,130
46,835
Not available
1
0
0
0
0
Sub Total z Not Available
1
0
0
0
0
Grand Total      
695
1,519
8,957
7,520
104,110

 

Appendix E

COLLECTIVE INVESTMENT FUNDS (JERSEY) LAW 1998 ('THE LAW')
CONTROL OF BORROWING (JERSEY) ORDER 1958 (THE “ORDER”)

SUMMARY OF STATISTICAL SURVEY OF FUNDS SERVICED IN JERSEY AS AT 31 DECEMBER 2004

Analysis by Class

Fund Type
Number of Funds
Number of Separate
Pools
NAV £ Millions
Unclassified CIFs
531
1,853
79,092
Recognized CIFs
8
39
2,386
Expert CIFs
44
49
4,289
CIFs Sub Total:
583
1,941
85,767
COBO Funds
250
273
18,343
CIFs & COBO Funds Total
833
2,214
104,110

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