Isola prepares the ground for Brexit
The Minister for Financial Services, Albert Isola, has outlined the measures his department will adopt in the coming weeks and months in financial services and Gaming to best prepare to meet the challenges that lie ahead.
In his recent budget address, Mr Isola underscored that while it is very much ‘business as usual’, the Ministry of Financial Services will work harder than ever before to preserve the business that Gibraltar enjoys today and to seek out the opportunities that the ever changing landscape makes available.
“What is clear is that whatever changes may come, they will not arrive until 2019 at the earliest and therefore we need not panic, but focus and be best prepared for whatever change comes our way,” he added.
In gaming, the review of the Gambling Act, announced earlier this year following the proposals of the ‘four Peter’s’ will be extended to analyse and assess the risk of Brexit to Gibraltar’s operators, and to identify the areas and issues that Gibraltar as a jurisdiction is able to deal with that will maintain its position as the premier Online Gaming Jurisdiction.
This will cover and touch many areas, including arrangements with the UK and other markets with whom Gibraltar may build direct relationships, Mr Isola said.
“We will work with the four Peter’s in these areas as well as of course, with each of the operators,” he added.
“The gaming community is fully aware of the absolute commitment of this Government to tackle the issues they have and to meet the challenges faced together in the months and years ahead. I am convinced we have the knowledge, expertise and will to make this happen.”
In the field of financial services We have been in contact with the Finance Centre Council and with a number of the major players in the Insurance community as well as most of the investment managers.
It is clear that the UK market is critical, he said, and that access to the single market is an important part of these businesses.
“We will shortly be setting up small working groups with professionals in each of the areas of the Sector to assist us in determining the risks arising from the uncertainty and to prepare a route map for the opportunities that any change to our existing arrangements may present.”
The department will also review its existing product line and examine new possibilities, as will review the business plan moving forward.
“Uncertainty is bad for business and we must therefore work to deal with these on a step by step basis.”
“As I have already mentioned in this House, we have new two new insurance licence applications (since the 23rd June) before the FSC and I am reliably informed there are more to come across a number of different areas, which is welcome news. These include new lines of business, which are exciting and innovative,” he said.
“At this time our Regulator will pull out all the stops to ensure we are efficient and business friendly in assisting new applicants through the authorisation process. We will work to get better at what we do across all areas of these sectors.”
Since it opened last year, over 7,000 accounts have been opened with the Gibraltar International Bank, £244 million in deposits and an increasing loan book with some 450 mortgages is a testament to the work of the team at the bank, Mr Isola said.
“Many spoke of the doom and gloom at the departure of Barclays in late 2013 and yet today it is a distant memory, with a seamless transition to this modern, innovative and digital bank.”
Mr Isola told the House that he believes the target date for break even and profitability after three years trading will be met.
The bank is also working on new areas in terms of products and functions, including mobile banking, he said.
In the area of financial services, Mr Isola said his department has introduced significant legislation this last year to further support the sector as they continue their efforts to attract new business to Gibraltar.
“We believe more than ever, that it is right to continue working on improving the legal and regulatory framework to enhance and develop the business environment across the whole of this sector,” he said.
Turning to insurance, Mr Isola said the introduction of Solvency II in January 2016 increases the capital requirements for insurance companies and in turn this makes it harder for smaller start-up insurers.
“As a result, we believe there is an opportunity to attract more Managing General Agents or MGAs to Gibraltar,” he said.
“A number of new MGAs have or are being established in Gibraltar and we have seen quite some interest in this area.”
“The compelling reasons to establish an insurance company in Gibraltar apply equally well to MGAs and we are keen to increase the number of insurance intermediaries operating from Gibraltar.”