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Guernsey Structure Employed In UK Mortgage Scheme

Thursday, January 12, 2012

Guernsey’s Protected Cell Company legislation will be used to create an insurance company which will underpin a new scheme being introduced in the United Kingdom to allow lenders to offer larger mortgages to home buyers.

The Guernsey office of the Jardine Lloyd Thompson Group is to play a key role in the new mortgage indemnity insurance scheme being introduced by the UK Home Builders' Federation (HBF) and the Council of Mortgage Lenders (CML), supported by the UK government.

The scheme will allow for greater credit to be offered to UK homebuyers, with mortgages under the scheme to be underwritten by house builders and the UK government. By insuring the risk of default losses, the scheme allows lenders to offer 95% loan to value (LTV) mortgages on new homes.

The JLT Group will manage and develop the scheme through a joint initiative of its operating companies, Lloyd and Partners Limited, JLT Specialty Limited and JLT Insurance Management (Guernsey) Limited, which will run a captive insurance company for HBF.

Nick Wild, Managing Director of JLT Insurance Management (Guernsey) Limited, said: “I am delighted that after more than two years of development work by JLT, this very substantial project is now to be implemented. Guernsey’s Protected Cell Company legislation will be used to create an insurance company which it is anticipated will operate with between 50 and 100 cells.”

Steven Rance, Partner of JLT, commented: “This risk management solution, created in response to the reduced availability of mortgage funding for homebuyers with small deposits, will reduce lender risk at higher LTV ratios and so allow lenders to offer 95% LTV mortgages for new home buyers at more competitive rates."

“The UK's major lenders and house builders are all supporting the scheme which is being backed by the government and is expected to launch in March. This is an extremely timely and exciting development for lenders, builders and the UK housing sector,” Rance added.

Before the launch, JLT will be developing the legal framework, scheme structure, insurance company and management information systems. Initially, the scheme is expected to run for three years.

Stewart Baseley, the Executive Chairman of the Home Builders Federation, said: “The lack of high loan-to-value mortgages has been a major constraint on new home sales for the last four years. The indemnity scheme should provide a significant boost to new home sales over the next three years. Everyone involved in the scheme is now working very hard to ensure customers and home builders gain maximum benefit. HBF is therefore pleased to have appointed JLT whose experience and expertise will be crucial to the scheme’s success.”

Dominic Burke, Group CEO of Jardine Lloyd Thompson Group, said: “This is an excellent example of JLT working with its clients and stakeholders to provide innovative solutions, in this instance not only addressing the needs of the client but also their end customers.”

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The Report

Offshore Trusts Guide: Introduction

The History of Offshore Trusts
Development of Professional Competence in the Jurisdictions
What Future for the Trust?
The New Age of Transparency
The Swiss Association of Trust Companies
The Society of Trusts and Estates Practitioners

Offshore Trusts Guide: Jurisdictions

Bahamas

Bahamas: Legal Framework and Formation Rules and Fees
Bahamas: 2006 Private Trust Companies Legislation

Barbados

Barbados: Legal Framework and Formation Rules and Fees
Barbados: Supervisory and Licensing Regime and Fees

Bermuda

Bermuda: Legal Framework and Formation Rules and Fees
Bermuda: Supervisory and Licensing Regime and Fees

British Virgin Islands

British Virgin Islands: Legal Framework and Formation Rules and Fees
British Virgin Islands: Special Trusts Act 2003
British Virgin Islands: The Trustee Act 2003
British Virgin Islands: :Supervisory and Licensing Regime and Fees
British Virgin Islands: New Laws on Private Trust Companies
British Virgin Islands: New Private Trust Company Regulations

Cayman Islands

Cayman Islands: Legal Framework and Formation Rules and Fees
Cayman Islands: Supervisory and Licensing Regime and Fees

Cook Islands

Cook Islands: Legal Framework and Formation Rules and Fees
Cook Islands: Supervisory and Licensing Regime and Fees

Cyprus

Cyprus: Legal Framework and Formation Rules and Fees
Cyprus: Supervision, Licensing and Tax

Gibraltar

Gibraltar: Legal Framework and Formation Rules and Fees
Gibraltar: Legislation, Regulation and Supervision

Guernsey

Guernsey: Legal Framework and Formation Rules and Fees
Guernsey: Trusts Law 2007

Isle of Man

Isle of Man: Legal Framework and Formation Rules and Fees
Isle of Man: Supervisory and Licensing Regime
Isle of Man: Uses Clients and Tax Treatment

Jersey

Jersey: Legal Framework and Formation Rules and Fees
Jersey: Supervisory and Licensing Regime
Jersey: Trusts Amendment Act 2006
Jersey: Foundations

Liechtenstein

Liechtenstein: Legal Framework and Formation Rules and Fees
Liechtenstein: Regulation Supervision and Transparency
Liechtenstein: Characteristics of Liechtenstein Trusts
Liechtenstein: Foundations

Madeira

Madeira: Legal Framework and Formation Rules and Fees

Malta

Malta: Legal Framework and Formation Rules and Fees
Malta: The Trust and Trustees Act 2004

Mauritius

Mauritius: Legal Framework and Formation Rules and Fees
Mauritius: Characteristics of the 2001 Trusts Act
Mauritius: Additional Provisions of the 2001 Trusts Act
Mauritius: Tax Treatment

Monaco

Monaco: Legal Framework and Formation Rules and Fees

Nevis

Nevis: Legal Framework and Formation Rules and Fees

Panama

Panama: Legal Framework and Formation Rules and Fees
Panama: Requirements for Acting as Trust Company in Panama

Seychelles

Seychelles: Legal Framework and Formation Rules and Fees

Turks & Caicos

Turks & Caicos: Legal Framework and Formation Rules and Fees
Turks & Caicos: The Voidable Dispositions Ordinance

Vanuatu

Vanuatu Legal Framework and Formation Rules and Fees




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