offshore jurisdictions in the world for investment funds and are still growing. It interests me when people say that we’re not that big in the funds industry—we’re huge in the funds industry.
Ironically, our growth and market leadership in ILS has actually been from looking at what we have done in the funds industry. Some of our fund numbers dipped and we didn’t continue to maintain the absolute leadership position that we had, but the fact that we don’t maintain that position does not mean we’re small in that industry.
Our ILS group used a lot of history, experience and knowledge to ensure that we hit the ILS ground running and maintained a leadership position, and now that we’ve got that, everybody involved in the ILS space is vehement, steadfast and determined to maintain this position.
Wojciechowski: What I gleaned from playing my part in the development of ILS was fundamental stuff—listening to your clients’ needs, acting on them and then articulating how you’ve changed to meet them—it was as simple as that.
What we did with ILS is directly applicable to what we are doing and will continue to do on the asset management side. Some of our regulation for the transformation of risk into the capital markets wasn’t as streamlined and user-friendly as it could have been. It had nothing to do with its regulatory prowess; it regulations.
just wasn’t as simple as other jurisdictions’
The market saw Bermuda as a reinsurance leader and wanted that business here because they felt comfortable with the stability and knowledge that Bermuda provides to this industry globally. Through a collaborative effort between the regulators and stakeholders in Bermuda and the markets in London and New York, the BMA were quick to see that opportunity.
They got involved in trying to make changes to reverse negative trends, and the BSX stood up and took notice right away because we felt fundamentally that if you start to see capital formations shift away from where the business is being held, eventually you’re going to create an eroded situation and you’re going to lose business.
So we jumped on it and said ‘Look, we have got to make sure the world does not continue to put financing vehicles in a different place from where the business is being done.’ Intuitively speaking, it should never have happened—we should have always had the business here. Bermuda listened to what its clients wanted, and started seeing the evolutionary process occurring in the reinsurance industry.
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We saw that evolution in the market and whether it was painful or not, we addressed it. It has been painful, because this evolutionary process in the ILS and convergence area has put pressure on the traditional market.
We were proactive, however, and made the changes and met the clients’ needs, and then we did what you have to do in business, which a lot of people don’t do—and that’s the hard work, it’s being on the ground, it’s meetings, it’s dinners, it’s doing what put this place on the map decades ago.
It was making people comfortable with us that we were their true business partners and making them want to do business with us. It was pretty interesting to watch the results because there was a flow of business going southbound on the ILS side, and then there was a tidal flow where it was back and forth a little bit and now we’ve completely stopped the flow.
Having said that it’s a very good story for Bermuda, but we have to be conscious that we don’t fall into the trap that we’ve fallen into with other industries. We have to continue to listen to our customers. If there’s an issue, we have to evolve with it.
Collier: We’re all in competition with one another somewhere along the line, but prior to 2008 things were not that bad. We’ve learned a hell of a lot over the past five years or so that’s cost a lot of people a lot of effort and time.
But there’s been a real effort by the service providers in Bermuda, including the government, the BMA, the BSX, and Business Bermuda who are working much more closely today than they have for a long time, taking up more of a can-do attitude with a willingness to get things done, because there is a lot more we can do, with the ILS initiatives being just one example.
Bridgewater: In the asset management space, we had our opportunity to engage with our clients; we listened to them despite some hard messages coming through, and we responded in a fast and effective way. We made changes to legislation to bring about positive change. We haven’t yet seen the complete result of the green shoots we spoke about, but they are starting to come through. It’s interesting that difficult times lead to innovation.
Webber: We’re at our best point of collaboration that I’ve ever seen. It’s about more than just talking and listening to each other—Conyers and Appleby are at the table together, KPMG, PWC, EY and Deloitte are at the table together, all talking to the government and the BMA with one voice, all putting this product together for the sake of Bermuda as a
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