DUBLIN - Industry executives here painted the Isle's future as an offshore domicile as big and bold, but representatives from Continental European countries spoke of several difficult tasks ahead for their markets stemming from three years of the bear market.
Gathered for the sixth annual Global Funds Conference, co-sponsored by the Dublin Funds Industry Association and the National Investment Company Service Association, those anchored in Dublin were touting their country's reputation as a leading offshore domicile known for its progressive, yet prudent regulatory approach. The Irish were the first in the European Union to regulate hedge funds and retail funds-of-hedge funds, they said. They were also the first to allow the use of prime brokers and to approve exchange-traded funds.
"Ireland has emerged as the leader in the alternative arena in recent years," said Jeffrey Holland, chairman of the Dublin Funds Industry Association.
While those at the conference contend that Dublin is the fastest-growing funds administration center, it needs to stay progressive in its approach to product development in order to maintain top-dog status. It must also move up the value chain by adding additional activities such as asset management, which it is currently in the process of providing Additionally, another key is to stay competitive in fund administration costs.
"Its hard to envision any circumstances in which the financial services industry will not do well in Ireland," said Lindsay Tomlinson keynote speaker and chief executive of Barclays Global Investors Europe.
Meanwhile, European fund representatives spoke of pension reform, regaining investor confidence, the difficult regulatory environment and the suitability of the retail investor in hedge fund products (see MME 6/16/03).
Not one person attending the CEO roundtable said European regulators are doing a good job of creating a better-regulated market and a freer economy.
"I find regulation to be more of an impediment to doing business in Europe," said Steven Spiegel, senior managing director and chief of global distribution for Putnam Investments.
Still others warned of changing times ahead. "We're seeing consolidation in the fund industry like we've never seen before," Holland said. "Clearly, doubt will be the hallmark of our time."
Despite all the talk about the difficult times ahead, there was a sense of optimism as well. "We forget the inevitability of cycles," Spiegel said. "Cycles drive business. What goes around comes around. The business hasn't changed all that much."
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