reporting streams from the various regulations, rather than creating separate pieces of technology for each separate issue. It is important for all of us to consider the various objectives that we are seeking to achieve and how we can streamline them as technology moves forward.


Whiley: I look at FATCA no differently from when AML came into play. If you look at where we are today with AML legislation, Bermuda has been very advanced and ahead of other jurisdictions. The BMA did a great job of working with various industry groups within the financial services sector in getting ahead of the AML compliance requirements in an efficient and timely manner, and I see the same process now in 2014 with FATCA, so it’s just a progression.


Bridgewater: With regards to cooperation between the public and private sector, especially when it came to developing the FATCA regime, there was a lot of consultation with the Ministry of Finance to find a resolution to this new regulatory requirement, and when we came out with model 2 as a jurisdiction we felt it was the right answer for Bermuda.


Horton: FATCA, like much of the changing regulatory environment, is now a pivotal component of our industry and we must treat it as central to how we operate our businesses. With this in mind, it is more about how we cope with it, because that’s ultimately what is going to define how successful we are. I believe there is an opportunity from the raft of changes facing our industry and it is therefore important that we embrace it, adapt to it, and make the best of it.


Truran: What’s actually transpired—and it’s an unintended


consequence—is that for US persons wishing to do business outside of the US, it has become massively inconvenient. In fact, many institutions are looking at the cost of then having to monitor and report and are saying ‘we’ll choose not to do business with US persons’.


What has then transpired is that the UK has followed a slightly different model, which is more around residency versus citizenship, but the exact same thing has happened.


While this was spurred by FATCA many of those clients are worried about the next wave of bilateral agreements. Some of those clients are starting to move money to offshore banking centres of excellence and looking for banks in reputable jurisdictions, with good technology, and access to the global markets, but are not in the US. So that naturally creates more opportunities for countries like Bermuda.


“Thirty-day delinquencies are not getting worse, while the 90-day non-performing loans are going to be a tougher nut to crack.” Michael Collins


So what’s happening is there’s actually a massive void building where non-US financial institutions don’t wish to deal with US persons, and vice versa. For Bermuda, it creates a headwind that’s not going to stop. If we’re on top of our game, from an offshore jurisdiction perspective, we should capitalise on that.


There will be a flight to quality and we need to be that quality such that we are not reticent to do business with people who don’t reside here, we actually welcome them and embrace them because we have a means of adhering to regulation in an effective manner.


Maiato: For a number of reasons FATCA is an opportunity and we may see growth as a result. What we’ve seen in some of the offshore banks, not necessarily as much in Bermuda, is that a lot of the onshore money sitting in US banks, particularly from Latin America and other emerging markets, starts flowing into the offshore jurisdictions.


59 Bermuda Finance | 2014


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