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Investors put faith in the big offshore players

Norwich Union Internat-ional head of marketing Nick Burton says a dash for quality has benefited the leading players in the offshore bond market.

Burton says market concerns have pushed people towards firms with a strong brand name and ratings when they look to hold an offshore bank account within an offshore bond for tax purposes.

He says in the past six or so years, cash has typically accounted for one-quarter of all offshore investments but following the onset of the credit crunch, two-thirds is now invested in cash as direct fund investment has subsided.

He says: “For now, people are looking to play safe and that is more likely with the big global players.”

Burton also says that given fluctuations from firms such as of Northern Rock and Bear Stearns, customers are no longer placing huge investments of £500,000 to £1m with one banking institution, preferring instead to spread the risk across a number of players.

He says: “Cash has traditionally been seen as a riskfree return but not even cash is safe anymore and people are aware of it.

“Advisers and investors are spreading their risk by placing amounts with different institutions to cover those dangers.”


Industry takes hit to profitability

Profitability in the UK financial services industry has declined at a record pace and business volumes have fallen at the fastest rate in 17 years, according to a PricewaterhouseCoopers survey.


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