In times gone by, Bermuda was the go-to place for high-net-worth families to preserve their wealth for the benefit of future generations, allowing the island to develop a trusted legislative and regulatory framework, and become a hub for world-class service providers.

While this technical expertise remains, other jurisdictions such as the Cayman Islands, Channel Islands, Switzerland, Singapore and the United Arab Emirates (UAE) have successfully increased the competition for this business, reducing Bermuda’s ability to stand out from the crowd in this respect.

Hamilton Trust Company Limited, part of the Moore Family Office Group, is one of the longest established trust businesses in Bermuda. Linda Longworth, managing director, Claudio Satasi, finance director, and Alex Whittaker, client director, shared their perspectives on this increased competition, along with the challenges and opportunities for Bermuda’s trust businesses, and why a family trust is still an effective structure to ensure a longstanding legacy for future generations.

The three main reasons why a family trust is established are tax planning, asset protection and succession of wealth. While appropriate tax planning remains important, the other two reasons are becoming more so, particularly against the backdrop of turbulent political and economic events, like those now taking place in the US.

To put the significance of this into context, Ms Longworth said historically, offshore trusts are less appealing for US citizens from a tax perspective. Recently however, they have received a lot more interest from Americans wanting to structure a trust in Bermuda and “willingly” pay whatever tax they have to pay.

Another benefit of family trusts is flexibility. As families grow, trusts can be incorporated within a private trust company (PTC) structure and they can also be restructured to meet the needs of younger generations: “Trust law develops over time and it continues to stay relevant to what families require, and I think Bermuda does well keeping up with that,” said Mr Whittaker.

Often, the younger generation will also have new ideas about how they want their legacy to be invested. In particular, they want to have an impact: “More green and socially responsible investing,” said Ms Longworth. “They also want to steer away from certain investing,” added Mr Satasi. “We have some that want to steer away from high tech that use low cost labour. They’ll stay away from oil and gas.”

Additionally, many want to pivot from what previous generations have done and Mr Whittaker pointed out that it’s their role to find the most effective way to help them achieve this: “Do they want to open their own business? Do they want to be entrepreneurial? Do they want to be charitable? It’s about finding a way through the family structure to assist them in their goals.”

In terms of newer wealth and new business opportunities, jurisdictions such as Singapore and the UAE are benefiting from the rise in high-net-worth individuals in Asia because traditionally, the heads of those families want to keep their wealth administration hubs close to home. This may change however as the next generation, many of whom have been educated in North America and Europe, come to the fore.

Where they see more immediate opportunity however, is from Latin America, as many of those families want their wealth kept further away from home: “We saw a lot of that with some of the more politically turbulent countries in the region, such as Venezuela, where many of its high-net-worth families, who would traditionally look to Curacao for civil law reasons, then thought: ‘Actually, that’s a bit too close to home’. A lot of these Latin American families also have physical protection concerns,” he explained.

Over recent years, families and their advisers from civil law countries have become more knowledgeable of common law trust legislation. For Latin America, the Cayman Islands and British Virgin Islands (BVI) have seized this opportunity, but Bermuda’s link with Miami along with more positive jurisdictional marketing, could attract more of these families here instead.

While more should be done to market Bermuda to high-net-worth families around the world, initiatives such as the Economic Investment Residential Certificate (EIRC) and the proposals to introduce a more structured family office framework, along with foundation company legislation, could appeal to families who otherwise wouldn’t consider this jurisdiction.

“Bermuda, back in the heyday, was the hub where you set up high-value trusts. There’s no reason why we can’t get back to that,” said Mr Whittaker.

The post The business of trust appeared first on RG Magazines.

Bermudian reinsurers — as happens whenever a major catastrophe strikes — stand to foot a hefty portion of insurance losses emanating from the wildfires that ravaged the Los Angeles area in January.

Early estimates from carriers including RenaissanceRe, Arch Capital, Everest Group, Conduit Re and Hamilton Insurance Group, suggest the reinsurance support from Bermuda will be worth billions of dollars to the stricken area.

The sheer scale of the losses from the Eaton and Palisades blazes, which razed miles of city blocks and left at least 29 people dead, was unprecedented. Total property and capital losses could total as much as $131 billion, according to a report by UCLA’s Anderson School of Management, while insured losses are expected to come in between $40 billion and $50 billion, of which Moody’s expects reinsurers to bear at least 30 per cent.

One of the questions raised by this tragic event are why the proportion of losses insured were not higher given that this event happened in a relatively wealthy area of a very wealthy country.

That lack of insurance penetration was noted by AM Best’s Dan Hofmeister, who said in an interview with Bermuda Re & ILS: “It’s odd because a lot of it involves extremely wealthy individuals with less coverage than they probably should have.”

One issue is that it has become harder to get coverage — insurers and reinsurers have reduced their exposure to wildfires in the face of increasing risk. Some major carriers stopped writing new business.

Drier and warmer conditions, as well as increasing development in at-risk zones have made damaging blazes more frequent. Nine of the ten costliest wildfires in US history, ranked by inflation-adjusted insured losses, have occurred in the past eight years, according to the Insurance Information Institute.

In California, state regulations for many years required insurers to price coverage only based on past experience, effectively limiting insurers’ ability to charge premiums that reflected their true exposure. As private insurers pulled back, the FAIR plan — the state-operated insurance backstop — had to take more of the strain, leaving taxpayers on the hook when losses occurred.

Evan Greenberg, chief executive officer of Chubb, explained during the company’s fourth-quarter earnings call in January: “In the area where the wildfires occurred, our exposure has been reduced by over 50 per cent,” Mr Greenberg said. “We’re not going to write insurance where we cannot achieve a reasonable risk-adjusted return for taking the risk.”

The FAIR Plan stepping in to provide underpriced coverage to fill the gap left by retreating insurers was not a sustainable solution, Mr Greenberg said. “One way or another, the citizens of the state pay the price for coverage,” he added.

Chubb, a Swiss-based re/insurance giant with an office in Bermuda from where it writes property reinsurance among other lines, in January estimated its losses from the LA wildfires at $1.5 billion.

California has implemented recent rule changes that allow insurers to use catastrophe modelling for the first time and to pass on reinsurance costs to customers.

Though this will mean higher premiums for homeowners, it will also increase the supply of coverage. As Ricardo Lara, the California Insurance Commissioner, told delegates at the Bermuda Risk Summit in March: “We have to get to availability to get to affordability.”

Mr Lara’s presence at the conference spoke volumes about how the Bermuda market is regarded as having an important role in covering large, global risks. He said now was the time for insurers and regulators to show “bold and creative” leadership to address the growing risk, particularly incentivising more mitigation in the form of more fire-resilient buildings.

The impact of the wildfires on reinsurance capital will be about the same as a major hurricane, analysts have noted. However, it will eat through a substantial chunk of some reinsurers’ annual catastrophe budget within the first quarter, so they will be keeping fingers crossed for a relatively quiet hurricane season later in the year.

While the wildfires will cost the Bermuda market billions of dollars, the flipside is that every claim paid is a reminder of its value proposition — to be there when disaster strikes to help businesses and communities recover.

The post Getting burned appeared first on RG Magazines.

The Uptown Development Authority is quietly working to rejuvenate the parts of Hamilton just outside the commercial hot zone. In doing so, it is tackling some of Bermuda’s major structural issues head-on, including the housing crisis, economic growth and sustainability.

As part of the Bermuda Economic Development Corporation, the UDA brings together investors, planners, architects, developers and other interested parties to highlight the opportunities and create as clear a path as possible to realising them.

The UDA has identified a number of sites ripe for development in the island’s Economic Empowerment Zones, and has worked with architects and designers to create conceptual visions to open potential developers’ eyes to the possibilities.

As its name would suggest, the UDA started out with a focus on Northeast Hamilton, but its remit has expanded to include the other EEZs of Southeast Hamilton, St George’s and Somerset. A branding change to reflect the broader focus will bring a new name, the Urban Development Authority, said Erica Smith, executive director of the BEDC.

In the EEZs, incentives for new businesses and investments exist to stimulate regeneration.  The Approved Residential Scheme — which eases some restrictions that apply to the rest of Bermuda and also gives developers opportunity to negotiate breaks on fees and taxes including duties on building materials, payroll tax and land tax — is one such programme.

“I feel the best use of our funding from the Government is to do some of the preparatory work that any developer or investor would need to do to make a decision, such as market research, feasibility studies and working with architects to come up with concepts,” Ms Smith said.

“People can’t necessarily see the potential of a site, so in order to move the bar, we visualise it for them.”

For some potential development sites, the BEDC has created conceptual, high-level designs illustrating what could be done — for example, a six-storey, 50-unit design for a site on the corner of Brunswick and Elliott Streets; another six-storey, 50-unit concept for a site near the eastern end of Church Street; and a proposal for a mixed-use development — 60 residential units, a boutique hotel and a new health clinic — on the publicly owned site of the health clinic on Victoria Street.

Given that building costs and interest rates have surged from pre-pandemic levels, the economics of development have become more challenging. Ms Smith said the Government had allocated $50 million to back financing guarantees to bring down borrowing costs for developers of approved projects in the EEZs.

“Investors will always be concerned about the ability to make a return and the likely profit margin,” Ms Smith said. “To help provide data around those questions, we have carried out a survey on housing demand, to determine what kind of housing people are looking for, and at what price points.”

While most of the residential projects envisaged would not be considered “affordable” housing, their construction could help to alleviate the housing crisis, Ms Smith said.

“The more supply we create, the more prices will come down, because when people have more choices, they’re not competing over one property — and it’s this competition that drives rents higher.”

Interest is growing and the BEDC has met with around 15 developers or investors, several of them overseas entities with experience of building residential housing in cities around the world. Units built under the ARS can be owned by foreigners, without restrictions.

City living may be especially attractive to young expatriate workers who relocate from other cities to work in international business. The BEDC is surveying the IB community to see to what extent housing is an issue for their guest workers and what interest they may have in investing in residential developments.

Ms Smith is hopeful that the public will see the first of the proposed projects get under way this year, highlighting the possibilities to other prospective developers.

“If there’s the right mix of support, concessions and streamlining that is bespoke to each development, I think we can make this work,” she added.

• For more information, visit the UDA’s website at www.uda.bm

The post Smoothing path to housing development appeared first on RG Magazines.

The building of Google’s new subsea cable-landing station in St David’s promises to bring a wide range of economic benefits over time, according to the telecommunications industry expert who helped to bring it here.

Fiona Beck, an adviser to Google and the former CEO of Southern Cross Cable Ltd, a Bermudian-based submarine cable company, said the benefits ranged from jobs in construction, trenching, mooring and marine work, regulatory fees and taxes, and potential boosts for other industries, such as renewable energy and satellites.

Additionally, staff with the necessary technical expertise will be needed to operate and maintain the station — potentially bringing training opportunities and jobs for locals.

“I’m encouraging Google to think about the training opportunities now, so that at the time the cable-landing station is built, there may be opportunities for locals who are job-ready,” Ms Beck said. “Not only is it supportive to the community, it’s also cost-effective to hire locals.”

Ms Beck, a former director of the Bermuda Business Development Agency, was instrumental in crafting the island’s digital hub strategy, developing its legislative framework under the Submarine Communications Act 2020, and establishing the relationship between Bermuda and Google.

She describes her Google advisory role as like an ambassador, bringing Google and Bermuda together to make agreements that will benefit both during a long-term partnership.

A subsidiary of Google has entered into a 262-year lease with the Bermuda Land Development Corporation for a 5.9-acre site in Southside that will be home to the proposed 50,000-square-foot landing station, built to accommodate multiple cables.

Its first cable will be Google’s “Nuvem”, which will connect Portugal, Bermuda and the US East Coast. It will be the first cable to directly connect Bermuda with Europe. Ms Beck said approximately one third of Nuvem has already been laid between Bermuda and the Azores.

The station will serve Google’s strategy and also be open to new cables from other providers — most likely other global content platforms such as Meta, Microsoft or Amazon. Multiple cables will give Bermuda the capability to be an Atlantic subsea cable network “switch” with vast amounts of internet data flowing through the station on its way around the world.

Google places a high value on sustainability. This could bode well for renewable energy opportunities, given the power needs of the station, Ms Beck said.

“Power is expensive in Bermuda,” she said. “Using alternative energy sources will serve a dual purpose of reducing costs and supporting Google’s net-zero emissions initiative. Google may consider a solar installation at its site, or seek to purchase power from another solar, wind, or wave source. As a substantial power purchaser, it could help to invigorate the alternative energy market.”

There are also good reasons for space and satellite businesses to find a subsea cable hub attractive, with cables able to back up and supplement satellite data transmission. There is a longstanding connection with the space industry in the East End, where the Cooper’s Island tracking station monitors spacecraft launches for both Nasa and the European Space Agency.

“There’s the potential for crossover between the space, satellite and submarine cable industries at St David’s that is quite unique,” Ms Beck said.

Perhaps the greatest economic benefits from the subsea cables will come from the “multiplier effect”, with increased potential for hi-tech businesses using AI, big data, or future technologies.

“When Google comes here, others want to be here too,” Ms Beck said. They have brand recognition and other companies are drawn to it.”

The post Wired for growth appeared first on RG Magazines.

Mark, a financial controller at a mid-sized reinsurance company in Bermuda, didn’t see the problem coming. “It started with a basic financial model,” he recalls. “Five years later, we had a 60MB monster that took three minutes to open, crashed multiple times daily, and kept me chained to my desk for three weeks prior to each quarter end.”

His company had fallen into the Excel trap – a pattern business consultants at Treefrog Consulting see repeatedly. Like many powerful tools that offer quick relief, Excel provides an immediate business high. It’s accessible, familiar, and delivers results fast. But without proper governance, that helpful tool morphs into a corporate addiction with serious side effects.

The signs of Excel dependency are everywhere:

When the only person who understands the marketing dashboard spreadsheet takes a vacation, reporting grinds to a halt. When quarterly reports must be generated, teams spend dozens of hours manually gathering data from past spreadsheets to track current progress. When the CEO needs urgent numbers during a board meeting, the critical file crashes repeatedly.

“The spreadsheet had its issues,” admitted Mark. “We knew our processes were unstable and increasingly slow, but the thought of rebuilding everything seemed impossible. We always thought one more fix would do it. We were trapped.”

Treefrog Consulting specializes in Excel rehabilitation – not by forcing businesses to abandon their familiar tool, but by implementing a structured recovery program.

“The breakthrough came when they helped us separate our data from our presentation layer,” Mark explains. “We kept using Excel for what it does best – analysis and visualization – but moved our critical data to a proper database where it belongs.”

The transformation was remarkable. Their bloated 60MB file shrank by 92%. Processing that once took hours happens in seconds. Most importantly, the business no longer ground to a halt when key employees are unavailable.

Treefrog’s team recognizes Excel’s critical role in business while establishing healthy boundaries. Treefrog’s president, Dmitry Mnushkin explains, “This simple principle of pushing Excel data into a database allows clients to keep their familiar tool while gaining proper data controls, audit trails, and reporting capabilities.”

The intervention is remarkably effective, allowing companies to track changes properly; pass audits with confidence; generate reports directly from secure databases; reduce dependency on individuals and scale processes.

Excel addiction doesn’t have to be a terminal condition for your business processes. With the right approach, you can keep the tool you love while breaking free from its most dangerous side effects.

About Treefrog Consulting: Established in 2013, Treefrog specializes in helping companies in the (Re)Insurance space scale through thoughtful application of technology. Visit them at www.treefrogconsulting.com or send them a note at [email protected].

The post Advertorial: Excel – The Business Addiction appeared first on RG Magazines.

Covid-19 was supposed to sound the death knell for the commercial real estate sector, as remote working became entrenched in the pandemic’s aftermath. A few years later, it’s apparent from the cranes punctuating the Hamilton skyline that things have changed dramatically.

Huge investments in two new office buildings, and millions more ploughed into an overhaul of the Hamilton Princess and Beach Club, signal tangible confidence in the need for bricks and mortar, the preference of businesspeople to meet in person and the island’s future.

The impetus for much of this rejuvenation of the city comes from Bermuda’s thriving re/insurance sector, says Penny MacIntyre, a partner with Rego Sotheby’s International Realty.

Brookfield House, at 91 Front Street, being developed by global infrastructure giant Brookfield, is scheduled to be the first of the two major new office buildings to welcome tenants, with construction completion due in June 2026.

This nine-storey block, which also borders on Chancery Lane and Reid Street, is set to become the global headquarters for Brookfield Reinsurance and its Bermuda-domiciled affiliates. It will comprise 55,000 square feet of state-of-the-art commercial space and approximately 3,000 square feet of retail space.

Luscar Place, at 69 Pitts Bay, Road, will rise on the site of the demolished Belvedere Building in west Hamilton. A terraced, seven-storey structure, it will feature 130,000 square feet of office, retail and restaurant space. Completion is anticipated in April 2027.

The Green family, owners of the Hamilton Princess and Beach Club, who also developed Point House and Waterloo House in the same area of town, are also the investors behind Luscar.

Ms MacIntyre is the listing agent for both the Brookfield and Luscar properties. She has already seen strong pre-leasing interest from tenants eager for prime waterfront space.

Inquires were predominantly coming from re/insurance tenants for the office floors and retail or restaurant operators for the ground floor units, seeking spaces ranging from 4,000 square feet to more than 40,000 square feet, she said.

Demand for prime (Class A/A+) office space has climbed markedly over the past 18 months, with available inventory in the city’s central and business district area at its lowest level in more than two decades.

“As such, quality, ready-to-move-in spaces in prime locations do not sit on the market very long,” Ms MacIntyre said.

“As with all new construction, existing tenants in Bermuda looking for a potential upgrade tend to be the first wave of demand. But what’s different now, a few years after the pandemic, is the increased interest from US and European-based companies looking to set up more sizeable offices here.

“Those companies are getting their heads around the strength of our current commercial leasing rates, construction costs and residential housing needs of their staff.”

Some of the wave of new re/insurers to launch on the island over the past five years are seeking prime space, while more established, larger re/insurance firms need extra room to accommodate growing staffs.

“Because of the lack of prime turnkey-ready office spaces, longstanding office buildings continue to attract tenants who need space either immediately or in the next few months,” Ms MacIntyre said.

“Quality spaces in Class B properties vary widely in terms of location, sizes and views, but appeal to tenants who are price-sensitive, have timing constraints or no appetite for paying for a new build-out.”

Landlords with dated interiors are adapting by either upgrading lobbies and common areas or being more flexible on terms, she said.

Ms MacIntyre believes corporate confidence in Bermuda as a business jurisdiction has increased as a result of turbulent geopolitics and the US tariffs that have disrupted global trade and sparked financial market volatility.

Plans to build a new, five-storey office building on the site of the Bluck’s Building at 4 Front Street have also been submitted to the Planning Department, creating the potential for more prime space.

While international business is driving commercial construction, it is also a major constituent of Hamilton’s hospitality industry, as business visitors come in to shop for re/insurance, attend board meetings or go to conferences.

As the largest hotel in the city and the venue for many of those conferences and meetings, as well as corporate group business, the Hamilton Princess and Beach Club is a favourite with business clientele.

The Princess is close to completing a $15 million renovation of its Bermudiana Wing. All 113 rooms were stripped and upgraded. Following construction there are now 101 rooms, plus six one-bedroom suites that can be converted into two-bedroom suites. The work, overseen by general contractor Greymane Construction, started on November 18 last year. The first guests moved into refurbished rooms in April.

The work was Phase 4 of a multiphase overhaul, a massive, ongoing investment from the Green family to realise the hotel’s full potential. More than 100 tradesmen were on site each day and other local businesses involved included: Botelho Wood Architects, First Class Electrics, Efficiency Ltd, H&H Plumbing and Mechanical Ltd, Eminence Tile and Stone, Switchworx Ltd, Crisson Construction; and BUE (BAC Universal Electric).

The refurbished rooms are modern and elegant, with expanded balcony space offering views of Hamilton harbour or Pitt’s Bay. On a tour of the just-completed work, Tim Morrison, general manager of the hotel said the renovations would “elevate the space to the standard of luxury, comfort, and service that our guests have come to expect”.

Features include LED lighting, white oak wood furnishings in the living areas, granite features in the bathrooms with spa-like, deep soaking tubs in the suites. The 690 sq ft one-bedroom suite and 1,035 sq ft two-bedroom suites are at the far western end of the Bermudiana wing with spectacular water views to the west from oversized balconies.

Mr Morrison said the hotel had a mix of guests on business, on family holidays and “bleisure” guests who came to work and enjoy the island — and the renovated wing would appeal to all.

As business travel has rebounded strongly from the lows of the pandemic, the Hamilton Princess has made changes to strengthen its offerings to corporate visitors.

“We listened to our local corporate clients seeking intimate and boutique-type meetings spaces to fill their smaller meeting needs,” Mr Morrison said. “The result of that feedback was taking 14 guest rooms out of inventory on our Gold Floor in 2023 to add our Executive Meeting Suites in the summer of that same year.

“These four meeting suites were envisioned through the support and wish for continued enhancement by our hotel owners.”

Hamilton has traditionally been seen as a commercial centre, rather than a residential hub, but there is also a drive for more residential development in the city to help ease the housing crisis.

Ms MacIntyre said there was a need for more housing in Hamilton, particularly units available for rent.

“The challenge for developers is the ‘entry costs’, such as the cost to purchase a property to redevelop and construction costs,” she added. “With construction costs as much as 40 per cent more than before the pandemic, incentives are critical for developers especially if doing a speculative build project.”

These could include exemptions on import duty, reduced or waived payroll taxes for a period, and reduced land taxes, she suggested.

The hope must be that the IB-driven wave of development in Hamilton will add vibrancy to the city, build confidence in Bermuda’s future and generate knock-on benefits for the domestic economy.

The post Hamilton bounces back appeared first on RG Magazines.

Bermuda’s international business sector is a world leader in providing expert solutions for complex problems. In order to sustain this position however, they need to recruit and retain the brightest minds available. Unfortunately, the island’s main jurisdictional competitors want this talent too. How can Bermuda attract them here?

We sat down with recruitment expert, Sylvia Jones, director of Bermuda operations for Elevate Executive Selection, who explained what the most in-demand jobs are, what challenges and opportunities Bermuda offers international experts, and what more needs to be done to fill these roles.

In recent years, actuarial, risk, compliance and corporate administration have been high-demand roles, with actuarial being the most difficult to fill: “There are not enough actuaries in Bermuda and there are not enough actuaries globally to meet the demand,” she explained.

A major hurdle is the specialised nature of this particular job, but companies, industry bodies and the Bermuda College have made a concerted effort to find ways to help potential candidates achieve the qualifications and experience they need.

“The actuarial accreditation is quite a lengthy process but companies are happy to hire actuaries who are not fully qualified, and they work with them through their qualifications while they’re in their employment here,” she said, adding that there is a lot more being done now compared to 20 years ago.

“The associations like Abic (Association of Bermuda International Companies), Abir (Association of Bermuda Insurers and Reinsurers), Biltir (Bermuda International Long Term Insurers and Reinsurers), the companies themselves by way of scholarships and internships, the Bermuda College and the various training bodies are doing everything they can,” she said.

To an extent, this is working. The number of Bermudians employed by the international business sector is increasing year on year. However, the problem remains numbers. “We don’t have enough people here to meet the need. It’s a population issue, not a talent issue,” Ms Jones said.

One possible area for improvement would be the education system: “In my ideal world, I would have every child love mathematics and then maybe we’ll be able to solve that problem,” she laughed.

In the meantime, Bermuda needs international talent, but the lack of appropriate housing, the cost of living and the cost of doing business here all pose a significant challenge. “Actuaries who have ten plus years of experience in the actuarial space, they’re very hard to attract to Bermuda because, by then, they’ve reached a stage in their life where they’re quite comfortable where they are and the compensation has to be there to get them to agree to come to Bermuda.

“But, there’s a very real awareness of the cost of living here, the cost of housing. They’re really big issues that prevent really good candidates from taking jobs here.”

Added to that is the increasing cost of hiring and Ms Jones has noticed that when jobs are lost in Bermuda, they are not always replaced in Bermuda. This, she said, is “shrinking our international business sector in a very quiet, subtle way”, thus creating a negative economic impact.

On the flip side however, Bermuda does continue to offer a high standard of living and a significant career boost: “For anyone coming in from overseas, the number one reason they take the job is because it represents a step up on the career ladder,” she said.

This is particularly the case for younger people who may have lower expenses and fewer commitments. She did warn, however, that these employees may only wish to stay for a shorter period of time.

In spite of the recruitment challenges, Ms Jones is confident that Bermuda still “marginally” maintains a leading position globally and the C-suite candidates and start-ups she speaks with choose Bermuda because “they feel that this really is the re/insurance capital and this is where all the action takes place and they want to be a part of it.”

Unless the housing crisis is solved and the cost of doing business is reduced however, she does believe that “we may have reached a peak in terms of growth and capacity for growth here. Those two big factors would enable the international business sector to grow significantly.”

The post Can Bermuda win the war for talent? appeared first on RG Magazines.

Figuring out the likely impact of US President Donald Trump’s tariffs has been a necessary concern for many Bermuda businesses during the past three months.

For retailers, builders and reinsurance professionals alike, the erratically implemented, up-down, on-off taxes on trade between the US and almost every other country will be a factor they need to somehow incorporate into their planning for the future.

The prospect of proposed port fees, under the US Ships Act, of up to $1.5 million per call for vessels built or flagged in China, such as Bermuda Container Line’s MV Oleander, could have had particularly horrendous consequences.

However, on Easter weekend, there was much relief with the US Trade Representative’s announcement that short sea routes and smaller vessels were expected to be exempt from the fees.

Construction costs in Bermuda have soared in recent years with the island forced to import aggregate because of exhausted local quarries and the effects of general inflation.

The tariffs could bring another inflationary surge, with many local construction companies served by US suppliers who source some of their materials from tariff-targeted countries including Canada and China.

Any retailers who buy non-US produced goods from a US supplier will also feel the pinch and will need to be creative to avoid costs surges.

For example, Sacha Bearden, owner of Baptiste, a construction supplies business, told The Royal Gazette that although many of the goods she brings in are made in the US, others are made in Vietnam, a new tariff target. Some materials are from Mexico, delivered to bonded warehouses in Florida from where they are shipped to Bermuda without attracting a tariff.

In February, when Mr Trump had revealed only tariffs on China, Canada and Mexico, the Bermuda Chamber of Commerce warned the result was likely to be an increase in the cost of living. Since then, the US has ratcheted up the pain, imposing at least a 10 per cent tariff on nearly every other trading partner.

With many Bermudians already struggling from the generational spike in the cost of living seen since the pandemic, a resurgence of inflation is the last thing the island needs.

Services are not in Mr Trump’s crosshairs. Bermuda is a significant exporter to the US of financial services, predominantly re/insurance.

However, that does not mean Bermuda’s re/insurers will be unaffected. Claims for rebuilding after hurricanes could be higher, given the likely inflationary impact on construction materials. In the event of a recession spurred by tariff-driven inflation, insurance demand would fall as economic activity slowed.

Instability in the bond market that has already been evident since the tariff shock started to reverberate will impact the value and yield of the fixed-income securities that dominate re/insurers’ investment portfolios, potentially eroding returns and capital bases.

In these tumultuous economic times, there are many uncertainties ahead.

The post Braced for impact appeared first on RG Magazines.

Chidozie Ofoego was named the new Financial Secretary at the Ministry of Finance. He will be responsible for the finance ministry’s headquarters, Accountant-General’s department, the Department of Social Insurance, the Office of the Tax Commissioner, Customs tariff and duty collection, and the Registrar of Companies. His previous experience includes working for the London Borough of Hounslow and as director of financial reporting and planning at Imperial College London. 

Gemma Rochelle has been promoted to to executive vice-president, group general counsel and chief compliance officer at BF&M. She has also been promoted to the group executive committee.

Hamilton Insurance Group named two new directors to its board: Therese Vaughan, a former CEO of the National Association of Insurance Commissioners, the standard-setting body for insurance regulation in the US, and Neil Patterson, the retired chairman of the KPMG group of entities in Bermuda, who will also serve as chairman of the Hamilton board’s audit committee.

Everest Group has promoted Jim Williamson to lead its reinsurance and insurance businesses, adding to his existing responsibilities as Everest’s executive vice-president and group chief operating officer.

Robin Saul has been appointed deputy managing director and legal counsel at Arch Insurance (Bermuda). She joined Arch in 2019 as head of claims and legal counsel, and will retain her current responsibilities in addition to her expanded new role.

Greg Hendrick, the CEO of Bermudian-based Vantage Group, has been appointed as an independent director on the board of Verisk, the global data analytics and technology provider.

Clarien Bank has appointed Roger Brown as senior vice-president and head of commercial banking. He will be responsible for managing Clarien’s growing portfolio of high-value client relationships within the commercial, corporate and institutional sectors. Mr Brown was previously a regional vice-president in Commercial Banking at Laurentian Bank in Toronto. 

Jamie Schmerer has been promoted to the role of SVP, Enterprise Risk at Fortitude Re. His responsibilities will include leading Fortitude Re’s regulatory relations efforts in Bermuda.

Charles Craigs has joined Ascot Group as managing principal overseeing the company’s third-party capital operations in Bermuda. Mr Craigs joins Ascot from Canopius Re, where he spent 15 years in executive leadership roles, most recently as CEO of the Canopius Bermuda platform.  Ascot also announced the appointment of Dane Lopes as head of US Partnership Engagement & Strategy.

The Everen Specialty board of directors appointed John Talarico as chairman and Tim Bucci as deputy chairman.

Chris Sinkey has been appointed to the new role of chief operating officer at Relm Insurance, the specialty carrier supporting emerging and innovative industries. He will oversee sales and marketing, operational excellence, and corporate development, including capital raising and M&A.

International General Insurance has promoted Stav Tsielepis to the post of group chief actuary, with responsibility for capital, pricing, reserving and exposure management.

Rosemarie Minors has been appointed manager, Compliance and Regulatory Affairs and Privacy Officer at Axa XL in Bermuda. The company also announced the appointments of Tiffany Heslop, vice-president, senior underwriter, Excess Casualty, Insurance and James Gregory, vice-president, senior underwriter, Professional Lines, Insurance.

Juniper Re, the reinsurance broker, has appointed Chris Hayward as head of office to lead its new Bermuda operation.

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After years of increasing costs, the outlook for Bermuda’s local business community brightened in the first quarter with the increasingly realistic prospect that at least some costs could start to fall over the next two years.

The reason is the imminent corporate income tax (CIT): the first estimate of what it will add to government coffers came in David Burt’s Budget statement in February — “at least $750 million a year”, the Premier and finance minister said. That is the equivalent of 60 per cent of the Government’s revenue estimate for 2024-25. Such a boost would create considerable opportunities for cutting taxes.

With CIT funds expected to flow in from July 2025, Mr Burt floated ideas including seeding a new health insurance fund with capital to support implementation of universal healthcare and cutting duty on fuel, food and construction items in the next fiscal year. And by 2026-27, he suggested employer payroll tax could be reduced.

The good news is there is little sign of a vanishing tax advantage sparking an exodus of international companies of economic substance, although much attention this year will be focused on the nature and size of qualified refundable tax credits, which will be critical to domicile decisions being considered in boardrooms.

The Government has signalled that companies within scope of the CIT will no likely no longer pay the employer’s share of payroll tax.

How the impact pans out will depend heavily on the ongoing work of the Tax Reform Commission. Led by Darren Johnston, the TRC has been tasked with making recommendations on tax credits, revisions to the tax system, how CIT funds should be spent for the community’s benefit, and legislative or constitutional guardrails (perhaps to ensure that a certain proportion of the money pays down debt or tops up the underfunded Contributory Pension Fund).

The deadline for the TRC’s final recommendations is the end of October this year.

It all seems too good to be true, and ironic, that Bermuda appears set to benefit enormously from a global minimum tax regime designed by large countries to effectively drive business away from offshore financial centres.

The new rules, the result of an Organisation for Economic Cooperation and Development initiative, require multinationals with revenue over 750 million euros ($815 million) to pay a rate of at least 15 per cent by allowing governments to apply a top-up tax on revenues earned in countries with lower rates.

Could the CIT prove to be a fiscal and economic lifeline? Only time will tell.

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One of the reasons why Bermuda’s international re/insurers are not looking to take flight at the first sign of a tax on profits is that the island is a genuine global hub for the industry with a cluster of world-leading talent and regulation that meets the highest international standards.

A powerful reminder of that was the third Bermuda Risk Summit in March. The Bermuda Business Development Agency event attracted more than 450 delegates, 40 per cent of them from overseas, including re/insurance executives, regulators, risk managers from companies including Amazon, and industry media.

The BDA estimated that the event generated around $3.4 million in economic activity, supporting 432 jobs. But as the BDA observed: “Far more significant were the long-term economic benefits brought about by the additional visitors who flew to Bermuda for business meetings during the week of the summit.”

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