Updates further enhance Cayman’s appeal

The Cayman Islands has for decades been one of the world’s leading banking and financial centers, currently ranking as the fifth largest banking centre worldwide, with over 200 banks, including 40 of the world’s 50 largest banks, and over US$1.5 trillion in assets. 

 

Private fund performance after the Dodd-Frank Act

The American private fund industry is a significant representative of Wall Street’s interests and regulating hedge funds was a politically sensitive undertaking since the inception of the industry 

 

Cayman funds stand strong in new era of governance

With the global hedge fund industry transitioning into a new era of heightened regulation and stricter fund governance, the Cayman Islands are extremely well placed to respond to the associated challenges.

 

 

The evolving role of hedge funds in institutional investor portfolios

Institutional investors face an almost unprecedented set of challenges. The post-crisis period has been one of slow economic growth, low or even negative real interest rates, volatile markets and increasing geo-political pressures.   

 

Transparency for fund directorships: It’s already here

The Cayman director class has not helped its cause as some (but by no means all) of its members resist exercising self-restraint, do not limit the number of directorships they take on, and become rather defensive and secretive when asked about the number of directorships they hold.

 

Drawing a line in the sand over the right to information

Concerns in the U.S. and Europe over security leaks and the debate about access to public versus private information runs in some ways parallel to the discussion regarding the information investors prefer and require to make informed decisions about their investments in Cayman Islands funds.

 

Where there’s smoke, is there fire? Some red flags in hedge fund fraud

We have identified certain red flags that we have seen in more than one situation and provide some practical guidance that investors may wish to consider to mitigate the risk of being victims of a fraud. 

 

 

Conflicts of interest between investment managers and their investors:

All investment management firms need to pay very careful attention to a recent paper issued by the UK’s Financial Services Authority (FSA) concerning the management of conflicts of interest between asset management firms and their customers.  

 

Into the spotlight: Independent fund directors

Independent directors and non executive directors have come into the spotlight in recent years following the well reported failings of firms such as Weavering Capital.  In earlier examples, Beacon Hill Asset Management and Bear Stearns High Grade Structured Credit’s offshore fund directors were singled out for criticism for failing in their duties. 

To list or not to list…Taking private equity public:

In a market traditionally focused on funds and banks, the Cayman Islands Stock Exchange (CSX) has recently expanded its services to support new issues and start-ups. The principal reason for seeking a listing is to raise new funds for establishing or growing a business.   

 

Does location matter?

The world has become global and this not only on business and private sides, but also family offices are seeking increasingly to get the most out of this international playing field at their hand.   

 

Beware of unwanted side effects from side letters

In the current competitive hedge fund marketplace the use of side letters between investors and funds has become commonplace. Side letters are used by funds and fund managers to draw in investors who jockey for the most favourable terms possible.   

 

Shariah compliant investment funds:

There is growing demand from investors domiciled in the Gulf Co-operative Council (GCC) region for investment portfolios that include Shariah compliant instruments. Although many sovereign wealth funds may invest in other noncompliant products, a growing part of their diverse portfolios is Shariah compliant.

Exposure draft for IFRS investment entities

For the first time the International Accounting Standards Board has proposed industry specific guidance for investment entities.

Alternative investments: Issues with valuing the invaluable

The enforcement division of the SEC’s Asset Management Unit has recently brought a number of complaints against various hedge funds and their investment managers.  

 

Fund governance that runs like a Swiss watch

In the current investment climate, is any institutional investor going to invest in your fund if your service providers deliver an unregulated service?

Regulators to decide over UCITS split

European regulators will decide early this year whether UCITS funds should be reclassified as “complex” and “non-complex” products in order to improve transparency of information about investment strategies.

 

Hedge fund valuations: The importance of a robust process, applied with rigour

Politicians make much of sharing values with their constituents, though they struggle at times to elucidate precisely what those values are and what it is that is of value to both sides of the equation.

 

Understanding investor due diligence

The investor due diligence process has evolved with the growth of the hedge fund industry. What was once a short and rather perfunctory process has grown into one which today is highly quantitative and detailed.

 

Current status of Islamic finance in the United States

Islamic finance is the fastest growing sector in the financial services industry, having grown by over 20 per cent annually in recent years, and estimates of current global Islamic banking assets under management range up to $1 trillion.