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The recent credit downgrade of South Africa to junk status has opened up a huge opportunity for Mauritius to become a meaningful
regional financial centre for the African continent. The cost of funding in FCY of South African financial institutions as well as corporates
has shot up significantly over the last couple of weeks and this is an opportunity for AfrAsia Bank to get better yields as well as encourage
these large institutions to tap into the large pool of FCY liquidity in Mauritius.
This can be arranged either through bilateral loans or syndicated loans in the Mauritian market depending on the quantum of funds
being raised by the centralised treasuries of these large South African institutions. This is an opportunity that we intend to capitalise on
and the work is underway.
Mauritius makes an effective investment conduit for international cross border investments, especially into Africa. The Island provides
the optimal balance for effective structuring to achieve decent returns whilst mitigating risks – investment, legal and taxation.
Increasingly, the Mauritius IFC is being used as a Private Banking and Wealth Management platform by Private Clients. This is reflected
through the growing demand for Private Banking and Wealth Management services, the continually increasing number of Private Banking
Clients seeking specialist advice to grow their business and wealth and the success of the recent international STEP conference that was
held inMauritius from6th to 7th April 2017. Furthermore, Mauritius adopted the new Financial Services Regulations in November 2016 by
providing tax holidays to companies holding licenses related to Global Headquarters Administration, Global Treasury Activities, Overseas
Family Office (Single/ Multiple), Investment Banking and Global Legal Advisory Services, assuming certain substance requirements are
met.
The above benefits will surely drive more Global Business activities in Mauritius by incentivising more global players, and eventually more
clients, to re-domicile to the Island. The Economy, as a whole, is bound to benefit and that includes the banking sector, especially those
banks which service Global Business Clients.
In the Private Banking industry, companies continue to invest heavily in technology, not only to reduce operating costs but also to enhance
customer’s experience, especially on the asset management side. The latter is increasingly becoming a key focus for private banks as they
target to increase their non-interest income. Moreover, in line with the rapidly growing ‘connected world’ in which we live, HNWIs are
demanding faster and easy access to their accounts through an efficient, user-friendly and rapid platform.
In Europe, we’ve seen an increasing number of banks that are implementing stricter compliance guidelines such as a restricted list of
approved countries for residency. This has resulted into a large number of individual accounts being closed especially for residents of
Africa and it may be an opportunity for Mauritius as these individuals look for a new home for their assets.
INDUSTRY INSIGHTS FROM OUR EXPERTS
Yogesh Gokool
Senior Executive,
Global Business
Banking
Thierry Vallet
General Manager,
Consumer Banking
Parikshat Tulsidas
Senior Executive,
Treasury and Markets