|The Bahamas Investor Magazine
July 29, 2016
July 29, 2016
The global financial services industry is a competitive space, and smaller jurisdictions must be savvy and strategic if they want to gain a foothold. Marketing The Bahamas is essential for the sector and at the forefront of leading the promotional charge is the Bahamas Financial Services Board (BFSB), led by recently appointed chief executive officer, Tanya McCartney.
Having only assumed the position at the end of 2015, effective December 1, McCartney had to get up to speed immediately. “When I took up the position of CEO, I hit the ground running,” she says. “I jumped into the deep end. Now I’m focused on balancing policy with continuing to promote the jurisdiction.”
Major global regulatory initiatives in response to calls for better tax efficiency have radically altered the financial services landscape in recent years. Efforts by the US to recoup lost tax dollars resulted in the creation of the Foreign Account Tax Compliance Act (FATCA), alongside pressure from the Organisation for Economic Co-operation and Development (OECD) and the G20 member countries for more information sharing through Tax Information Exchange Agreements (TIEAs).
“FATCA is settling down now and everyone is getting more comfortable with information sharing,” says McCartney. “There are lots of things going on in terms of international initiatives that we have to respond to. And I have been very, very busy since taking up the role.”
But if anyone has the requisite experience to handle the demands of the role, McCartney does. An attorney and chartered banker, she first joined the financial services sector in 1999 as legal counsel and compliance officer for The Private Trust Corp. Positions in Butterfield Bank, the UBI Group and RBC Caribbean followed. Prior to succeeding former CEO Aliya Allen at the BFSB, McCartney worked as assistant general counsel for regulatory compliance at Baha Mar.
She is also a keen advocate of the sector outside of her professional life, having served as president of the Bahamas Institute of Financial Services for the past six years.
“I believe that there are opportunities out there for financial services and we are setting the basic building blocks.”
On the global stage
In collaboration with the Ministry of Financial Services, the BFSB has stepped up its overseas promotional activities in recent years, with very encouraging results according to McCartney.
In 2016, the BFSB and the ministry are representing The Bahamas at events in Saint Lucia, São Paulo, Athens, Amsterdam, Mexico, Panama, Shanghai and destinations around the US. It’s an ambitious schedule that McCartney says takes a lot of time, planning and stakeholder discussion to pull together.
Even deciding which events to attend is a collaborative effort. The BFSB’s board of directors drafts a marketing plan which is then discussed with the Ministry of Financial Services. “We look at the toolkit in terms of what products and services we have and the ones we want to highlight or showcase,” says McCartney. “We go to the jurisdictions where we have business interests; we look at the markets; we look at our products and then we work with key stakeholders in the industry. We present a unified marketing front when we attend these events. Our vision is aligned when it comes to promoting the jurisdiction.”
Then the BFSB has to decide how it wants to participate at these events, whether through sponsorship, exhibiting, holding workshops or speaking. McCartney explains that this is often a question of resources. “We take into account a number of factors in terms of the level of sponsorship. We are a nice little engine, but we run on a small budget. We want the biggest bang for the smallest buck.”
When exhibiting, the BFSB tries to maximize its time by encouraging delegates to network and make local contacts. In markets where The Bahamas enjoys a well-established presence, McCartney says the BFSB will often try to communicate any changes or future developments in the sector. “We want to have a voice and we want people to know what is happening in The Bahamas.”
But the BFSB is not always content with the role of attendee or sponsor. In 2010, the organization began hosting its own briefings, the Landfall events. Today Bahamas Landfall enjoys an established footprint in Latin America, Europe and China and will continue to promote The Bahamas’ brand in those markets in the coming year with stops scheduled for Mexico, Brazil and Asia.
Maximizing the time on tour is often not just about attending and hosting events. For Minister of Financial Services Hope Strachan, the work doesn’t end when the event does. The ministry often meets privately with industry firms to extend their reach beyond the conference halls. “Not only do we go to the conferences and seminars, we set up private meetings with firms on their own turf and meet with people in the industry. We find out what we can do to assist them,” she says.
Once the tour itinerary is mapped out, the BFSB marketing department begins to pull it together–booking hotels, organizing travel, drafting invitation lists and liaising with contacts at the venue. McCartney is full of praise for her staff’s efficiency saying: “We have a small but very experienced and dedicated team. They do an excellent job of booking hotels and sorting out speakers on the ground. It is a team effort.”
Despite the logistic challenges involved in mobilizing these marketing missions, McCartney says they are worth it. “There is nothing like face- to-face contact to build relationships. You are dealing with high-net-worth individuals; people who want to see you and get to know with whom they are doing business. Financial services are about relationship management and that comes from getting to know people and spending time with them. Meeting one-on-one builds trust and confidence.”
Strachan agrees: “It is good to put a face to a name and identify people with the jurisdiction. I believe that is the way we are going to raise the profile of The Bahamas and make inroads into new markets.” The minister believes it is particularly important for government to be visible on these trips, giving potential clients and investors confidence that the government is engaged at a grassroots level and supporting its own professionals.
In May 2015, on her first official trip abroad to the STEP Caribbean conference in St Maarten, Strachan was surprised to find that no other governments were represented. During the event a delegate approached her and told her how refreshing it was to see a minister attending, and how she wished other Caribbean countries would follow suit. It was a moment that stayed with Strachan. “It left an impression on me because it showed why we should continue to go out and be involved. It was extremely encouraging. Even though you have a strategy in your ministry, sometimes you question how valuable it is. That cemented in my mind that we were on the right track and it is an ongoing theme on our trips.”
Strachan leads a small team from the Ministry of Finance at these events, selecting the most qualified to accompany her. “We need experienced people because you want to make sure they are able to interact in a meaningful way. They need experience and knowledge under their belt.” This year, however, the ministry has added a new component–adding one or two junior staff members to the delegation. The minister calls it an “invaluable learning experience” and says this type of exposure gives young professionals a better feel for the market and its issues.
Appointed to the CEO position in December 2015, McCartney wants her tenure to be characterized by effective outreach and sees promotional activities as central to the BFSB’s mandate.
“It is a 50/50 split between policy initiatives and promotional activities. We cannot let other jurisdictions get out there without us. We have always been a forerunner in financial services and it is important for people to know we are still fully engaged. We need to be visible and we need to be present to make sure The Bahamas is on everyone’s mind. It is about business development and awareness,” she says.
In particular, raising awareness in the emerging markets of Latin America and Asia–both regions that feature heavily in this year’s marketing line-up. With the Private Wealth Mexico Forum in Mexico City, the STEP LatAm in Panama City and the Private Wealth Brazil Forum in São Paulo all on the slate, it is clear the BFSB has Latin America in its cross hairs. McCartney calls the egion “a growth area”. Strachan echoes this and is particularly bullish on Mexico, saying that the work The Bahamas has done to gain ground in Brazil has laid the foundations for a move into that market. She has met with Mexican tax authorities and is positive about future opportunities there. “The possibilities in Latin America are endless. We were very enthusiastically received in Mexico and I am very optimistic.”
The government is also looking to Asia and, in October, will take a delegation to the China Offshore Summit in Shanghai. Strachan says building The Bahamas’ brand in Asia has been a challenge due to competition from other jurisdictions. “In Asia there were a number of people not as familiar with our jurisdiction as they were with others. They know about the British Virgin Islands; BVI is almost a household name. That is how well they are branded. It was good to get that experience so we can see what we have to do to bring us up to that same level.”
It is not enough to merely be present in these markets however, the jurisdiction needs to have something to offer them. The BFSB is keen to match the right products with the right markets–appealing to new clients by providing solutions that meet their specific needs. McCartney says The Bahamas’ portfolio of trust products, in particular the Investment Condominium (ICON) Fund and the SMART funds, is integral to attracting business from Latin America and says she is particularly excited about the forthcoming Society of Estate Trust and Practitioners (STEP) conference in Panama in September. “We collaborate a lot with STEP,” she says. “We have a good relationship with them and the trust product is key to our product suite in The Bahamas. We make our presence felt [at that event].”
Another product push this year focuses on captive insurance. The Bahamas has welcomed captive insurance companies since the 1960s and McCartney says the industry is set for a resurgence. “Captives is a growth area. There is a renewed interest in the product.” In January 2016, a delegation from The Bahamas attended the World Captive Forum for the first time in the conference’s 25-year history.
While McCartney says the three main areas singled out for marketing are wealth management, investment funds and captive insurance, she also emphasizes that the overreaching goal of the campaign is shoring up good will, good contacts and good opportunities. “We want to just keep focusing on what we do well and refining our business.”
And according to McCartney, The Bahamas is not a hard sell. She says the jurisdiction elicits a favourable response worldwide. “People have the view that it is a well-regulated jurisdiction with a range of product offerings and a highly-skilled labour force as it relates to financial services. The Bahamas continues to be seen as an attractive jurisdiction.”
The tangible benefits from the BFSB’s aggressive marketing campaign support this. While McCartney admits that it is difficult to measure and quantify feedback when hosting or attending events, she believes that the industry is reaping the rewards saying: “We survey our members and whether they are seeing growth. Ultimately that is what matters. That is the real feedback.”
Strachan agrees: “There’s a lot of anecdotal evidence. We get a sense from the industry that the trips are extremely worthwhile and extremely valuable.
“It is a lot of work, and it is ongoing work. The industry is extremely dynamic, every day there is some new challenge. There is never a moment to rest on your laurels. The team we have has really made a mark out there and we are going to continue to seek out opportunities and see how best we can sell The Bahamas.”