fixed rate deposit Quantum
products in particular. This
is because the products can
be used in an insurance
wrapper or offshore bond,
and because the funds will
be accessible in a year,
by when many investors
believe other investment
options will be starting to
look more interesting.
l Structured products
Some investors are willing
to consider a little
more risk in exchange for
the possibility of greater
returns than fixed interest
accounts generally produce.
For them, the offshore
banks are putting
together a growing array of
structured products, with
considerable input from
their customers.
Barclays Capital director
David Macdonald
notes that structured products
have benefited from
a change in the offshore
bond world, “where until
recently, general fixed term
bank accounts have been
very popular.”
“As a consequence of
falling rates, some bank
accounts that were paying
6% or 7% are no longer
available and people are
being offered 1% to 3%
instead. This is creating
opportunities for banks to
introduce such investors to
structured products.”
Barclays has been at the
forefront of this trend, with
its Three-Year and Five-
Year Guaranteed Deposit
accounts. These accounts,
which give investors protected
access to the FTSE
100 index, remain available
through the end of June.
l ‘Bespoke’ products
Standard Bank’s willingness
to accommodate its
IFA clients’ needs extends
to an openness to create
made-to-order structured
products for IFAs, according
to Wilkinson.
For example, a particularly
wealthy client or
a group of clients might
be looking for protected
exposure in a specific currency
to a particular index,
possibly over an unusual
time period that is not
available off the shelf from
any provider.
While structured products
and fixed deposit
accounts are important at
Standard Bank (increasing
the range and visibility is one
of the Wilkinson’s remits),
the meat and potatoes of
its IFA offering remains
its Optimum account, and
a variation aimed at IFAs
and their staff, known as
the Professional Demand
Account.
He says both are current
accounts with a low minimum
balance requirement,
free internet access, a Visa
Special report profeSSional ServiceS
total bank deposits by jurisdiction
250
150
£bn 200
100
50
0
’06
’07
Source: JFSC, GFSC, IoM FSC
debit card and other perks
aimed at making offshore
banking flexible and easy
to use.
l Currency choice
In the battle to cater for
investor tastes, currencies
increasingly come into
play, particularly as offshore
banks seek to attract
business from Asia and the
Middle East, which tend to
prefer dollars to euros and
even sterling.
Among those keeping an
ear out for currency preferences
is Anglo Irish Bank’s
Quaggan. The company’s
newest products include
a six-month fixed interest
bond – initially offered
in sterling only, then in
euros and finally in dollars
as well, in response to
requests – and a 12-month
fixed income account, in
sterling and euros.
Meanwhile, fixed
income, as opposed to
fixed interest, is “a big
issue right now”, Quaggan
notes. On a £5,000 deposit
– the minimum permitted–
this 12-month Anglo Irish
account pays a guaranteed
£16.60 a month.
“Take-up has been
strong, as we expected it
would be, because guaranteed
income is something
that clients were looking
for,” he says.
MAy 2009 [www.international-adviser.com] INTERNATIONAL ADVISER
’08
Jersey
Guernsey
IoM
As a consequence
of falling rates, some
bank accounts that
were paying 6% or
7% are no longer
available and people
are being offered 1%
to 3% instead. This is
creating opportunities
for banks to introduce
such investors to
structured products
“
”
David Macdonald, director,
Barclays Capital
35
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