BILLIONS of pounds are pouring into Guernsey-registered investment funds. Second-quarter figures released by the Guernsey Financial Services Commission reveal that the sector has again reached record levels, with the overall value of funds domiciled or administered in the Bailiwick increasing by 36.7% over the year to 30 June.

The quarter’s £2.9bn increase puts the total at £63.6bn, a rise of 4.8% over the second quarter.

Guernsey Promotional Agency chief executive Talmai Morgan said that while some of the increase was because of rising markets, most was due to a large increase in new money.

This was due mainly to hedge funds and alternative investment products.

‘These new highs continue to reflect Guernsey’s status as a major international centre for the administration of investment funds in what is undoubtedly an extremely competitive global market,’ he said.

‘The figures are good news.’

The value of the 203 open-ended funds reached a new high of £28.4bn, up £2.7bn or 10.3% over the quarter and £10bn – a massive 54.3% – over the year.

Closed-ended funds, of which there were 293, increased in value by £0.6bn (3.2%) to £19.9bn, also a new high. Over the year they grew in value by £2.2bn. or 12.4%.

It was not all good news, however, as the value of non-Guernsey schemes for which some aspect of management, administration or custody was conducted in Guernsey fell by 2.3%, or £0.4bn. to £15.3bn. Over the year to 30 June their value increased by £4.9bn, still a 47% rise.

The GFSC’s deputy director of investment business, Carl Rosumek, said that some of the increase in open-ended funds over the past year could be attributed to the performance of investment markets.

‘However, over the same period, net new investment into these funds exceeded £8.7bn.

‘This has mainly been due to the performance of alternative strategy funds, including hedge funds, which have attracted a significant amount of institutional and sophisticated investor interest.’

The increase in the value of non-Guernsey schemes over the same period is explained in the same way.

The increase in the value of closed-ended funds over the past year was due to a combination of new investment into such vehicles and increases in the value of underlying investments.