Client Overview:
A prominent listed insurance company in South Africa aimed to optimise the performance of its Collective Investment Scheme (CIS) located in Jersey while enhancing operational efficiency, and reducing large costs associated with its existing service providers. With initial Assets Under Management (AUM) of $65 million, the company sought to collaborate with experts to propel its fund’s growth while adhering to legal, regulatory, and compliance standards.
The Challenge:
The insurance company recognised the necessity for restructuring and, more importantly, optimising its fund’s performance. Simultaneously, they wanted to partner with the global asset manager, namely BlackRock Investment Management UK. The company sought a fund infrastructure provider capable of comprehending the situation and delivering comprehensive solutions to facilitate this transformation.
Lima Capital’s Fund Structuring Solution:
Lima Capital’s comprehensive fund structuring services involve various strategic steps. This process began with evaluating the investment strategy, designing an optimal fund structure, and ultimately included a recommendation to transition to Mauritius as a jurisdiction for enhanced operational efficiency. Following this transition, BlackRock could serve as the asset allocation advisor and Lima Capital as the sub-advisors, allowing us to meticulously execute directives pertaining to trading and portfolio management through the custodian.
After the successful transition, which considered all necessary legal and regulatory considerations, Lima Capital embarked on ensuring transparent performance reporting. This involves supplying pertinent data to a designated service provider, which is then utilised to create comprehensive monthly factsheets. These factsheets are designed to promptly provide investors with valuable insights into fund performance and crucial metrics. Additionally, we play a pivotal role in disseminating data on platforms such as Morningstar and Bloomberg.
We take charge of investor relations, overseeing subscriptions and redemptions, thereby enhancing investor contentment and alleviating administrative burdens for the insurance company. Our proficiency extends to effective cash management, involving trades within investment and cash accounts, and the management of the various fund custodians. Regarding fund administration, we engage and collaborate with one of our strategic partners, encompassing tasks such as fund accounting, compliance, transfer agency services and Net Asset Value (NAV) calculations. This strategic arrangement enables the insurance company to concentrate its efforts on long-term strategic development and distribution.
In regards to regulatory compliance and investor transparency, strategic audits are conducted by reputable, independent third-parties.
Results and Impact:
Through the collaborative efforts of the insurance company, Lima Capital, strategic partners and the expertise of BlackRock as the asset allocation advisor, the fund’s operational efficiency was significantly improved. Leveraging Mauritius’ jurisdiction and Lima Capital’s operational expertise, since August 2020 the fund grew from $65 million to $160 million. The company’s strategic decision to utilise Lima Capital’s fund structuring services led to enhanced fund performance, investor confidence, and regulatory compliance. This showcases the promising potential for significant transformation when industry leaders collaborate with specialised partners. If you have a fund and are aiming to enhance its operational efficiency, please don’t hesitate to reach out. We would be more than happy to provide our assistance.
