With a history spanning more than 45 years and a reputation today as one of the world’s leading offshore law firms, Walkers is one of Cayman’s most venerable institutions. From January 1964 when the late Bill Walker first opened the doors of WS Walker & Company, the history of the firm mirrors the birth, development, rapid growth and success of the financial services sector in the Cayman Islands.
As one of the founding fathers of the industry, Mr. Walker’s personal involvement in the crafting of Cayman’s early financial services legislation, notably the Trusts Law 1967 and the Legal Practitioners Law in 1969, ensured both his hallmark and that of the firm would be intrinsically linked to the nation’s most significant industry.
The transition for Walkers to a global presence began in the late 1990s. Following the well deserved retirement of Bill Walker in September 1999, for a good part of the next decade the management of the firm was conducted by a three member Management Committee consisting of Grant Stein, Angus Foster, now Mr. Justice Foster on the Grand Court bench, and myself, Wayne Panton. During this period Walkers’ international expansion really gathered pace. At the time, operating from just one office with 70 members of staff in 2000, it was a strategic decision for the firm to undertake an aggressive growth strategy both locally and in order to develop into a global offshore firm.
This foresight certainly paid off. Today, Walkers employs over 500 people around the world, with offices in seven countries. The Cayman Islands headquarters was followed by bases in London in 2001 and the British Virgin Islands three years later. Hong Kong, Jersey and Dubai followed and most recently an office was opened, earlier this year in Singapore, to expand the group’s footprint in Asia. We currently practice the laws of Cayman, the BVI, Jersey and the Dubai International Financial Centre but Cayman remains by far Walkers’ largest and most important location even though interestingly, the group now earns close to half its revenue from its international offices.
This period of global growth for Walkers clearly reflects the tremendous expansion within the Cayman Islands financial industry as institutions from around the world directed offshore business to these shores. Looking at the investment funds sector as an example, at the start of 1999 there were some 1,500 funds registered in Cayman, while almost a decade later that number was approaching 10,000. Similarly, the adoption of offshore vehicles for cross-border corporate and commercial transactions became more of a mainstream activity over this period. We have also seen the development of private equity into an asset class of its own and the considerable growth in debt and structured finance markets.
The global vision of the firm’s management became a reality as the Cayman Islands developed from an already successful international banking centre into the world’s most recognisable offshore financial jurisdiction. As Cayman’s leadership position in the offshore world has become more apparent, Walkers’ global network has expanded to meet the demands of clients all over the world, with the firm a key member of the elite group of offshore law firms, the so-called ‘Offshore Magic Circle’.
Advising on the laws of the Cayman Islands, the British Virgin Islands and Jersey, the principal focus is on corporate and international finance law. Walkers leads the market in its key practice areas: hedge funds, private equity, capital markets, structured finance and asset finance, with consistent ‘Top Tier’ rankings from the leading legal commentators. Furthermore, Walkers has been recognised as an industry leader with a string of awards in recent years, including ‘Offshore Law Firm of the Year’ from The Lawyer, STEP, PLC Which Lawyer? and Asia Legal Business – Hong Kong.
The firm also operates an internationally renowned insolvency and corporate recovery group, as well as being particularly active in trusts, commercial litigation and dispute resolution. Modern market developments such as Islamic Finance have been embraced to great success, while the suite of products continues to evolve with a new Employment Group recently established to take advantage of the wealth of expertise within the firm in that area. Walkers has also expanded its service delivery outside of the legal arena, with Walkers’ Management Group providing corporate, SPV and fund services from Cayman, the British Virgin Islands, Dubai and Hong Kong.
The recent global financial crisis combined with the sharp focus and general negative press surrounding offshore financial centres from international bodies such as the OECD has created a unique set of circumstances for all industry participants. These circumstances present a distinctive set of challenges for Walkers, which the firm has responded to in keeping with its reputation as a forward thinking and innovative leader.
While the economic crisis, sparked by the meltdown in the banking and credit sectors, has without doubt had a dramatic effect on business, particularly in terms of new fund formation and structured finance transactions, it has also created a number of opportunities. Walkers has managed to weather this storm as well as any of its peers, as the decline in one area of the business has been compensated by growth elsewhere, such as insolvency and corporate recovery. Additionally, thanks to its market leading technology and experienced professionals, our management group has also continued to grow.
The attorneys in our investment funds group have been busier than ever over the past year with complex restructuring work designed to allow funds suffering from illiquidity to continue trading and avoid liquidation. Innovative techniques such as redemption gates, side pockets, synthetic side pockets and paying redemption proceeds in kind, have all been employed to some extent by managers looking to preserve value and manage volatility.
As the financial crisis started to impact global markets, in the summer of 2008, Walkers anticipated the likely fallout in the funds sector and formed a specialist Distressed Funds Group. This innovative, integrated approach combined expertise from the firm’s funds, insolvency and litigation groups to provide support to clients establishing new funds, as well as those considering liquidation. One of the most significant effects from the financial crisis has been the continuous evolution of offering documents which now typically include measures that anticipate future liquidity problems.
Similarly within Walkers’ Finance Group, despite the sharp global decline in debt finance transactions, our securitisation and repackaging expertise has proven to be extremely valuable to clients seeking balance sheet relief from so-called toxic assets. Our restructuring team has also been involved in numerous high profile restructuring/refinancing transactions amid the current market volatility.
With Cayman’s recent ascension to the OECD’s White List, this endorsement further bolsters the jurisdiction’s reputation, along with that of the BVI, as hubs for international cross-border transactions and investment funds. This provides further opportunities for the firm to continue to demonstrate adherence to the highest standards, as we await the next stage of the OECD’s campaign and the introduction of a peer review mechanism.
A team player
Of paramount importance to Walkers are its community-based activities and the firm supports a wide range of projects in Cayman with active participation from staff at all levels. A particular favourite for employees is our support for the National Trust’s Blue Iguana Recovery Programme, which is such an important part of our Island’s heritage. As one of the National Trust’s Gold Sponsors, in 2006 Walkers pledged a total of CI$60,000 over three years to fund the operating costs of the Blue Iguana Recovery Programme. In 2003 we created a Blue Iguana soft toy for children, which is used to promote Walkers, the Blue Iguana Recovery Programme and the Cayman Islands at international conferences. The Blue Iguanas became such a hit that they have now become a key part of the firm’s marketing strategy.
Another important project is the Children and the Arts Programme, which Walkers launched in 2003 in order to encourage children’s participation in the arts and raise awareness of the academic and social benefits that can be gained from such activities. The most recent part of this initiative was the Walkers’ Children’s Art Review Club, which was initiated in conjunction with the National Gallery of the Cayman Islands. Walkers funds the programme which provides professional art instruction for 7-9 year olds, many of whom are very talented but do not necessarily have the means to attend after school activities.
The firm’s Dress-Down Programme has been an extremely popular method for Walkers’ employees to make a direct contribution to a range of important local charities. Staff members make a monthly donation in return for being able to wear casual clothes to the office on the last Friday of every month. Local charities are selected quarterly with input from staff and the scheme has been running since 2004. Among the many organisations that have benefited are: The Kiwanis Club of Grand Cayman, the Cayman Islands Cancer Society, Batabano Carnival, the Rotary Club of Grand Cayman and the Cayman Islands Humane Society.
The Walkers Charitable Foundation was also formed in 2004 to receive and consolidate charitable donations arising out of client transactions in order to benefit worthy causes. In recent years, substantial donations have been made to the National Gallery of the Cayman Islands, Cayman HospiceCare and the National Recovery Fund to assist those on Cayman Brac that were affected by Hurricane Paloma last year. Wherever possible, Walkers aims to be active participants in the Islands’ community service organisations in addition to providing financial support and Walkers’ staff have a great record of involvement in a wide range of community and environmental activities.
Earlier this year a group of partners, senior managers and associates took part in a 100-mile fundraising bike ride around Lake Tahoe in Nevada in order to raise funds for the Leukaemia & Lymphoma Society. The team rode in memory of former Walkers partner Frank Banks who sadly died recently after a long battle with brain cancer. Our five riders collectively raised over $40,000 for the charity, as part of a joint team with one of our major clients and we fully intend to be back there next year with an even bigger team.
One of those riders deserves special mention and that is Grant Stein, Walkers’ current Global Managing Partner, who recently celebrated twenty five years as a partner of the firm. We thank him for the significant contributions he has made to the firm over that time and in support of its charitable efforts.
As the firm prepares to move into its brand new, state of the art headquarters here in Cayman and usher in a new era, we are proud to have shared in the success of this jurisdiction. We look forward to many more years of helping our clients around the world invest and effect transactions in and through the Cayman Islands.