CSP major SMP Partners could be accused of ‘going native’ to the benefit of both the company and Isle of Man finance sector. In little more than a decade the operation has grown from the small arm of a City financial services group to a fully independent global player serving both the blue chip corporate and institutional market and the wealthy private client sector.
Following a management buy-out in June 2007, the business was re-branded into SMP Partners, acquiring all the senior management, staff and trust and corporate services operations of the business. As such, the company retains its position as one of the Island’s largest trust and corporate service providers, offering a full range of trust and corporate management services, including company formation, fund administration, tax advisory, legal and accounting, to in excess of 3,000 clients internationally. The company currently employs over 120 staff at its offices in Lord Street, Douglas.
Completion of the MBO means all investment in the business is now locally based with the seven owner/directors both working and living on the Island. This includes Chairman Steve McGowan and his long-term business partner, Managing Director Mark Denton. Further expansion is already underway with the recent development of a new fund administration operation and the granting of an Investment Business Licence by the Island’s Financial Supervision Commission. Steve McGowan explains:
‘The company’s independence provides our loyal client base with long term stability and gives us the platform from which to push forward into new international markets with new service initiatives. The Island is widely considered a centre of excellence for trust and corporate services and we are proud to have built a strong international reputation as one of the Island’s leading professional service providers.’
Dynamic environment
The Island’s zero tax strategy for business and recent changes to simplify company law has underscored the company’s faith in the Manx Government’s ability to continue delivering the dynamic corporate environment for business to grow and flourish. The company intends to further expand its suite of services and enter new and emerging markets by taking full advantage of the Isle of Man’s innovation and progressive development of the economy.
‘We have always maintained an entrepreneurial, forward thinking culture and independence gives us the opportunity to apply that entrepreneurial flair to bring our clients even better levels of service delivered with greater agility and flexibility. The unique combination of scale, stability and entrepreneurial ambition places us in a prime position to exploit the growth and changes we are seeing in the global wealth management arena and we are hugely excited about the future.’
Isle of Man…by choice
In 1997, Steve McGowan and a nucleus team from the then Edsaco Group were always up front about looking over all the options before relocating to a new operational base. But when it came down to it, other jurisdictions were not in contention, he said:
‘We needed to move 55 staff out of London all in one go to continue to be a viable operation and therefore had to contend with significant employment and housing considerations. As well as the progressive business environment, the Government’s helpful attitude was a major factor in making our decision.’
Since then the operation has grown exponentially – along the way becoming first part of MeesPierson Intertrust and then a strategic arm of Fortis, the Belgian/Dutch banking and insurance giant and global provider of corporate and trust services. Under Steve McGowan’s direction, a fresh cash injection of £5 million was pumped into expanding the Manx operation, already the hub of the company’s tax and IT activities. Then, in June 2007, following a strategic review of trust operations by the Fortis Intertrust Group, the Isle of Man directors were given the opportunity to take the business independent.
Fiduciary expertise
Its core operation is supplying international tax and structuring solutions to corporate and individual clients working in complex fiscal, legal and financial environments. The company’s formidable pedigree means it has the resources to provide a bespoke, all embracing wealth structuring and wealth protection service to its 3,000 clients across the world.
‘We combine the service and personal relationships of the private bank with the structuring expertise and ingenuity of the trust company,’ pointed out Steve McGowan. ‘We also take a global approach to business that is facilitated by our established network of contacts throughout the world, ensuring our clients receive the best service and advice for their long-term financial planning. This has evolved into a service covering all aspects of wealth management, from tax planning to yacht and aircraft registration and management, real estate and intellectual property solutions and securitisation. Tax structuring through companies and trusts was historically the key business, but as the industry and clients’ needs have developed and become more sophisticated, so, too, have our services.’
Professional endorsement
Regulation of trust and corporate service providers in the Isle of Man is regarded as an important ‘marketing tool’:
‘When we provide wealth structuring solutions for an international client, that client knows the advice we are giving is coming from a company that is monitored, regulated and licensed. We consider our licence an endorsement of our professionalism and our business.’
The right place to live
SMP Partners comprises several other members of the original team that first accompanied Steve McGowan to the Island – a testament, he adds, to the benefits of working and living in the Isle of Man:
‘We find the Island environmentally, professionally and socially attractive. Those with young children like the family orientated lifestyle. The cost of living is also favourable when compared to London – the Island is now my home and I know I’ve become very protective about it.’
How the Island benefits
It is estimated the company’s value to the local economy is worth £10 million plus annually in local expenditure, including income tax, national insurance contributions and payment to general suppliers – a figure amounting to £100 million since the original operation was first established in 1997.
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