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The location of the world's fifth-largest financial centre might surprise you - it's the Cayman Islands. Situated in the western Caribbean between Jamaica and Cuba, the Cayman Islands' financial industry is outpaced only by the mainland global centres of New York, London and Hong Kong.
There are now about 600 banks established in the Caymans, including 44 of the world's top 50, with assets on deposit exceeding US$ 500 billion. The Islands are also home to over 500 captive insurance companies, as well as some 2000 registered, administered and licensed mutual funds, with assets of over US$ 200 billion. (As at 31 Dec. 1999)
Royal Bank of Canada has long been a prominent member of this dynamic offshore financial community since 1964. Royal Bank of Canada Trust Company (Cayman) Limited, a wholly-owned subsidiary, was established in 1972 with a Cayman Islands class "A" bank and trust license as well as an unrestricted fund administrator's license.
Attractive Attributes
The success of the Cayman Islands as an offshore financial centre is based on a set of very attractive attributes Ð strategic location, innovative legislation, sophisticated infrastructure and a well-developed professional community.
The Islands are in a time zone that allows the Cayman business day to overlap those of major centres both north and south of the Caribbean from London to Los Angeles.
All the world's major accounting firms have Cayman offices, as do dozens of the world's leading legal firms with international expertise. These resources complement the expertise of the Islands' thousands of financial professionals, many of whom are expatriates from major industrial countries in Europe and North America.
Naturally, this thriving international community is fully connected to business and financial centres around the world by state-of-the-art telecommunications facilities. Three major U. S. carriers as well as Cayman Airways also provide an abundance of conveniently scheduled air transport services.
These attributes make the Cayman Islands a particularly efficient location for serving clients throughout North and South America, as well as Western Europe.
A Thriving Financial Community
The preeminent position of the Cayman Islands today can be traced to its unique history, which has greatly favored its development as an offshore financial centre. Officially a British Dependent Territory, the Caymans have their own popularly elected Legislative Assembly, and a Government headed by an Executive Council. The Islands' legal system is based on English Common Law. These long-standing arrangements and a climate of racial harmony have produced a stable political environment.
The highest standard of living in the Caribbean underpins the Cayman Islands' political and social stability. With a per capita gross domestic product (as of 1996) of US$ 28,900, there is little crime, and virtually no unemployment.
The absence of direct taxation has always been a fundamental feature of the Caymans. The Islands have never had a personal, sales, inheritance, company or trust tax of any kind whatsoever in their history. To provide long-term assurance of this "no tax" policy, the Government issues guarantees specifically exempting companies and trusts for up to 50 years from any future tax obligations which may arise.
An exceptionally hospitable environment for offshore companies and trusts has been developed through close consultation with the private sector. Innovative, well-crafted laws regarding financial institutions are supervised and regulated by the Cayman Islands Monetary Authority. These laws accommodate a wide variety of financial arrangements and instruments, while fully protecting client confidentiality.
The Caymans are also a particularly favorable domicile for mutual fund sponsors. The flexible framework of the Cayman Islands Mutual Fund Law accommodates a very wide range of fund structures and investment strategies within a user-friendly regulatory environment.
In 1997, another important institution was added in the form of the Cayman Stock Exchange, which specializes in the listing and trading of mutual funds and structured financial vehicles based in offshore jurisdictions.
The growth of international financial enterprises in the Caymans has led to the establishment of a large community of bankers, financial analysts and advisers, fund managers, lawyers and accountants. Royal Bank of Canada has played an active part in the development of this community, and our Cayman office now boasts a multi-lingual staff with wide-ranging experience in all aspects of offshore financial services.
Private Client Services
All private client services are delivered through a Relationship Manager, who is responsible for ensuring that the mix of services is tailored specifically to the client's individual needs. Specialized expertise is focused on services aimed at creating, increasing and preserving wealth. Through this personal relationship, the client has access not only to all services within the Cayman Islands, but also to all other services available through other Royal Bank facilities around the world.
Regardless of the physical locations and legal domiciles of various assets and financial vehicles, the client receives a seamless package of services through a single office. As plans take shape and evolve, Royal Bank provides specialized services as required in all relevant areas. The ultimate objective is to create and maintain financial plans and arrangements that deliver optimum results. Royal Bank personnel work closely with both clients and their advisors to achieve this objective. Regular review meetings allow plans to be modified and adjusted whenever necessary to accommodate changes in both personal goals and economic conditions.
The scope of service available from Royal Bank of Canada's Cayman office covers a broad spectrum, including:
International Trusts: Placing ownership of assets in a trust in an offshore jurisdiction is often a key element in personal estate and tax planning.
Offshore Companies: Accumulating assets in a company in an offshore jurisdiction can simplify financial management. International companies are often used in combination with trusts to secure continuity after death.
Investment Management Services: These are tailored to meet specific client criteria, from custody and execution of client-directed portfolios to discretionary management services for individuals.
International Banking and Deposits: The full range of international banking in all major currencies is available through the Cayman office. Deposits are also accepted on a variety of different terms, at competitive interest rates.
Corporate and Institutional Seivices
Royal Bank of Canada's Cayman office also provides a comprehensive range of services for corporate and institutional clients. In today's global economy, using appropriate offshore structures can be vital to achieving strategic goals for many types of enterprises.
Because the Cayman Islands offer a particularly favorable environment for mutual funds, special emphasis is placed on third-party fund administration services. Royal Bank's Cayman office has 10 years experience in this field, and is a leading provider of these services to a wide array of global clients. For many offshore mutual fund sponsors, convenient and efficient third-party administration services are a key element in achieving overall financial success.
The range of other services provided by Global Private Banking specialists to corporations and their advisors includes:
- Managing trust companies,
- Providing a full range of banking services for captive insurance managers,
- Acting in a fiduciary capacity for structured finance vehicles and securitizations,
- Acting as escrow agent, and
- Acting as security trustee.
For more details about these and other Royal Bank of Canada services, please refer to the accompanying brochure.
A Warm Caribbean Welcome
Last but by no means least among the advantages of the Cayman Islands environment are its warm climate and equally warm and welcoming people. Now firmly established in its international financial role, the Cayman business community offers a uniquely receptive environment to enterprises from around the world, and responds with world-class services in every respect. Royal Bank of Canada is proud to be part of this international success story.
To learn more about what Royal Bank of Canada's Cayman Islands office can do for you or your business, please contact:
Royal Bank of Canada Trust Company (Cayman) Limited
P. O. Box 1586 GT
Cardinal Avenue, George Town
Grand Cayman, Cayman Islands
British West Indies
Tel: (345) 949-9107
Fax: (345) 949-5777
E-mail: gpb.caymanislands@rbc.com
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