capital international group | corporate brochure

CapitalInternational Group

CORPORATE BROCHUREINSTINCTIVE FINANCIAL AGILITY

The Capital International Group offers an integrated range of financial services


Our VisionThe Capital International Group exists to improve lifestyles through increased prosperity.

Our ValuesWe seek to achieve this through the enduring values of innovation, integrity and excellence.

The Capital International group of companies (the “Group”) operates from the Isle of Man and specialises in the provision of financial services, including Trading & Stockbroking, Custody & Administration, Cash & Investment Management and Investment Structuring.

Our origins date from 1996 when Capital International was founded to provide custody, nominee and stockbroking services. Since then, an integrated range of financial services has been developed and the Group now has approximately $4.0 billion of assets under management or administration.

The Group has been built on the foundations of innovation, integrity and excellence to deliver the highest quality of customer service. We focus on financial institutions such as life assurance, pension schemes, fund and wealth managers, collective investment schemes, financial intermediaries and include the Isle of Man Government as a client. We pride ourselves on our close working relationships with clients and our ability to deliver customised solutions. As those relationships develop, clients use a greater variety of services from the Group as we become a trusted partner in delivering a universal solution.

The Group has achieved Investors in People status and is an active member of the Isle of Man Champions (the Government/Private Sector economic development initiative). We have a strong social responsibility ethic and support the local community via sponsorship of youth organisations and development initiatives focused on young people.

In Spring 2014, the Group opened the doors to its new office in Cape Town, South Africa. Capital International SA (the trading name of CILSA Investments (PTY) Ltd) was officially launched to provide discretionary asset management services within South Africa as its principal business activity. Additionally the team in Cape Town also provide domestic, onshore investment management and administration.

IntroducingThe Capital International Group

Innovation Integrity Excellence


1990

1996CapitalInternationalfounded

1998Won Old Mutual investment administration contract

2000Won first IoM Government discretionary mandate

2003Model portfolio service launched

2005Won second IoM Governmentdiscretionary mandate

2006Monthly unit trust dealspass 600 for first time

2007Monthly unit trust dealspass 700 for first time

Trading and stockbroking remain at the heart of our proposition. We buy and sell shares, bonds, gilts and a wide variety of asset classes and, via our direct lines into markets, we are able to negotiate on price and size, seeking to maximise assets and minimise financial risk.

The Group’s stockbroking business is a member of the London Stock Exchange and offers clients the ability to trade listed securities on any approved regulated investment exchange. Custody and clearing of listed assets is normally out-sourced to Pershing Limited, part of The Bank of New York Mellon Corporation.

Assets available for trading include:

■ UK and International equities ■ UK and International government bonds ■ Multi-currency corporate bonds, including

emerging market debt ■ Collective investments and offshore funds ■ Investment trusts and exchange

traded funds

In addition to the more traditional asset classes, we also execute trades in more specialised areas, including:

■ CFDs, warrants and traded options ■ Bullion and precious metals ■ Cash deposits ■ Foreign exchange

Key Business ServicesTrading & Stockbroking


2015

2009Quarterly equity and unit trust deals pass 6,000 for first time2008

Implementation of universal trading and investment administration platform

2010Quarterly equity and unit trust deals pass 8,000 for first time. All locations move to Capital House, Douglas. Capital International Group wins Isle of Man Company of the Year 2010

2011CIG reports record turnover figures.Total assets under administration or management at around $4.0 billion

Global CustodyA core component of financial services activity across the Group is custody. Custody via a nominee means that client cash, assets and investments are held in a ring-fenced environment, ensuring that monies are secure and separate from any individual company in the Group.

With our state-of-the-art investment platform, all clients and advisers have secure online valuation information and the ability to export data daily. It is around this custody and valuation service that clients then add our trading and stockbroking services.

Portfolio AdministrationFor institutional clients, we customise trading services into a full Third Party Investment Administration proposition shaped more closely to a client’s requirements. These arrangements combine custody, trading, investment management and payment services to offer an integrated solution.

This helps clients:

■ Reduce running costs and overheads ■ Optimise efficiency and straight through

processing ■ Reduce operational risk and cost ■ Offer enhanced services to their clients ■ Review their portfolio online ■ Have access to highly qualified and

experienced personnel

Key Business ServicesCustody & Administration

Case StudyListed International Life Assurance Company

The RequirementAfter our successful delivery of stockbroking services, a listed life assurer sought our assistance in improving the investment administration of their personal portfolio bond business.

The SolutionA full investment administration solution was agreed coupled with pro-active cash management. This involved:

■ The creation of two customised nominee companies

■ The opening of approximately 5,000 client portfolios

■ Re-registration of 10,000 asset lines, valued at approximately £1 billion

■ Over 32,000 signatures for authorisation, and a follow up process over six months

■ Simultaneous execution of portfolio activity, managing customer relationships and resolving queries

■ The implementation of a cash management strategy to consolidate cash balances and maximise returns

The ResultThe Group provides a full back-office investment administration solution including custody, asset pricing, asset dealing, corporate actions, dividend and fee collection plus cash management. This has enabled the client to improve delivery, to consolidate activity and to focus on its core competencies.


Key Business ServicesPayment Services

To help clients with their cash flow around the world, the Group offers secure services for companies to improve their cash management and cash payments. These include pre-paid debit card services and an online payment service called Bridge which handles both incoming and outgoing payments.

BridgeBridge is a simple, convenient and cost effective tool to make payments and receive funds online. It enables companies to access and control cash quickly and efficiently around the world.

It allows clients to:

■ View balances, transactions, issue and receive payments online

■ Cut transaction costs by using a single point of access to local clearing systems in overseas markets

■ Speed up invoice receipts by enabling overseas customers to pay directly into company accounts through their local bank

■ Upload balance and transaction information directly into accounting systems - reducing delays and mistakes caused by re-keying

■ Consolidate bank balances to optimise returns on cash

■ Improve overall cash positions ■ Free up administrative processes

Card ServicesWe have partnered with a multi-award winning money solutions company, which has grown to become the UK’s leading pre-paid service provider. Our card solution can be loaded with Sterling, Euros or US Dollars using a debit, credit card or online. There is no line of credit with the card so cardholders can only spend what is loaded.

Corporate clients gain several benefits, as pre-paid debit cards are:

■ Cashless alternative to salary payments ■ Control mechanism for corporate expenses ■ Efficient employee incentive and

benefit schemes ■ A flexible tool to manage expenses

Case StudyLeading eGaming Company

The RequirementThe company makes use of our discretionary cash services and our Capital Liquidity Account. This maximises the return on the eGaming company’s operational cash holdings and on its player deposits alongside appropriate liquidity. The company wanted a more efficient way of making and receiving payments using this cash.

The SolutionTo avoid having to transfer monies to their clearing bank and then having to instruct and key payment instructions, the treasury team linked the company’s cash to the Group’s online payment service. This allowed the client to upload payment instructions directly into our systems and monitor incoming transactions. Straight Through Processing technology removed keying errors and cut transaction costs by using a single point of access to local clearing systems in the overseas markets. The company’s invoice receipts now occur faster as their overseas customers can pay direct into a client’s account via their local bank.

The ResultThe company now has a holistic cash management and payment solution. This gives them higher returns on cash, coupled with a greater diversification of holdings, alongside a more cost-effective and time-efficient system for handling incoming and processing outgoing payments.


The Group offers secure services to improve cash management and cash payments


For clients and advisers who want to access investment markets but would prefer professional involvement in the investment decisions, we offer full discretionary investment management services.

Bespoke Discretionary PortfolioFor clients who seek a tailored discretionary managed service, our investment managers create bespoke portfolios investing in the full range of asset classes - including stocks, corporate bonds and government debt in all geographies - in accordance with a predetermined investment strategy.

The key benefits of a full discretionary service are:

■ An investment strategy tailored to a client’s precise risk profile

■ High levels of personal service and a dedicated investment manager

■ Full quarterly reporting with valuations available in hard copy and online

■ Experience of a stable, highly experienced investment team with a proven and successful track record

Key Business ServicesCash & Investment Management

Fusion | Managed Portfolio ServiceFor smaller portfolios, or where clients prefer greater diversification, the Fusion service provides a portfolio of collective investment schemes, managed on a discretionary basis. Fusion offers a choice of three risk-profiled investment strategies, in a choice of currencies.

All strategies target absolute returns through asset class diversification, with access to an unlimited range of assets, markets, and specialist sectors within collective investment schemes. Fusion employs an active investment management approach, which allows significant refinements to the target asset allocation, in response to changes in the investment climate.

Innovation Integrity Excellence† Standard & Poor’s Fund Ratings represent an opinion only, not a recommendation to buy or sell.

Cash ManagementIn addition to managing equities and bonds, we also specialise in cash management. In keeping with the Group’s core values the treasury team focuses on delivering innovative products and services. These naturally have a focus on maximising returns but with a balance of asset security and counter-party risk.

This customised, proactive approach to treasury services appeals to:

■ Corporate and trust service providers ■ Financial institutions ■ Local government authorities ■ Businesses and high net

worth individuals ■ Charities

Our flagship cash solution is the Capital Liquidity Account, which is an offshore cash investment account.

Its key benefits are:

■ Highly rated by Standard & Poor’s†

■ A fee-free investment solution ■ 2 day liquidity ■ Yields comparable to a fixed term

cash deposit ■ Diversified credit exposure,

comparable to a money market fund

Case StudySovereign Reserve Fund

The RequirementTo re-tender for the management of a large Sovereign Reserve Fund, whose objective is to deliver an absolute return as measured against a cash plus benchmark.

The SolutionIn developing an investment strategy for a mandate we undertook a detailed analysis to derive the optimum strategic asset allocation that could be expected to achieve the mandated return with the lowest risk. From this we calculated the expected return profile for the portfolio to understand the mean, maximum and minimum return expectations.

The ResultFollowing an extensive tender process, we were awarded a significant increase in our existing investment mandate. An additional five well known investment houses were also appointed.

Our absolute return investment process has proved itself through the dot com collapse, the recent near collapse of the banking system and the severest global recession for 60 years. It has achieved the expected portfolio returns and controlled the volatility risk. Indeed, the performance characteristics have been almost precisely as we projected in our original tender.


We provide access to investments, cash services and other financial instruments



Spread Bet SolutionsIn addition to traditional investment management we also offer bespoke spread bet services.

The Kinesis spread bet trading account can significantly enhance net returns from exposure to a range of securities, indices and managed strategies, delivering equivalent returns from the same underlying assets, but more tax-efficiently.

Kinesis can be written against an almost unlimited spectrum of financial instruments either individually or as part of a strategy, including equities, collectives, gilts and bonds, investment trusts and exchange traded funds, foreign exchange and derivatives.

Kinesis clients are typically introduced by an adviser seeking to offer their clients an efficient and tax-effective alternative to a directly held investment strategy.

Fund managers and promoters also utilise Kinesis to create specialist indices to track the performance of their funds, allowing their own clients the chance to bet on the investment strategy as opposed to investing directly.

Key Business ServicesInvestment Structuring

Case StudyBridging Finance Fund

The Requirement & SolutionThe Group was approached to be custodian for an Isle of Man Qualifying Investor fund and delivered an efficient, competitive and timely solution including online custody statements and swift transaction processing.

The client then appointed our fund administration team as Manager and to provide administration and corporate services to the Fund. The transfer from the previous Manager was completed efficiently with clear process and procedures being established for the Fund’s specialist asset class.

In a further development between the Group and the Fund, we have created an Index which allows clients to spread bet the performance of the Fund. This enables clients to go “long” or “short” of the Fund’s performance and to make tax-efficient returns.

The ResultAcross the Group we act as Manager of the Fund and as Custodian to the assets of the Fund. In addition, exposure to this specialist asset class has been broadened due to the Fund’s link to the Kinesis spread bet trading account.


Key Business ServicesFund Services

We provide fund administration services to a range of investment managers with exposure to traditional and alternative assets. Our specialist team offers fund clients a seamless, integrated solution with an emphasis on service excellence and long term relationships.

We are able to structure customised cross jurisdictional solutions for clients and institutions with specific requirements. Our coordination of legal and accountancy advice streamlines the fund formation, incorporation and documentation process.

Our experience enables us to provide a comprehensive and cost effective solution. Successful funds are typically those that get the structuring correct at outset. We offer formation and on-going administration for various fund structures, including Exempt International Schemes, Closed-ended Investment Funds, Limited Liability Partnerships, Unit Trusts, Overseas Funds, Qualifying Investor Funds and Specialist Investor Funds.

In addition, we are able to advise asset managers on the regulatory needs and the investment requirements for establishing funds in the primary global financial centres. As regulatory hurdles become increasingly high, the ability to provide start up support to experienced managers is important.

Case StudyHedge Fund

The Requirement & SolutionThe Group was approached to provide the establishment of a collective investment scheme and a manager for a hedge fund, since the client was not regulated as an asset manager themselves.

The fund was established as a British Virgin Islands Professional Fund, which limits the number of investors to less than 50 and prohibits a public offer of shares. These characteristics allow the establishment of an Isle of Man company that acts as manager to the fund, with the responsibility for all investment decisions, but which is exempt from the licensing requirements under local regulations.

The ResultThe Group’s fund administration team has established the fund enabling it to accept subscriptions from several seed investors and establish a successful track record; as the fund grows and builds on this success, the manager will become regulated. The structuring of the fund and the establishment of the manager provided a bespoke, cost effective solution for the client.



The Group provides offshore fund services to a wide range of clients, institutions and investors

Support functions reduce costs, provide greater flexibility and enable focus on core activities



The Group has a specialist business support team which provides services in:

■ Website design, development and hosting

■ ‘IT as a Service’ based on our virtual IT infrastructure

■ Ancillary services including accounting, payroll, marketing support, design, human resources, programme and project management

The business support division has developed to support the expansion of the Group. It combines technical specialists, commercial experience and project management skills, enabling us to integrate business change projects with the delivery of day-to-day support functions.

Business support functions can reduce costs, provide greater flexibility and enable customers to focus on core activities. A good example of this is ‘IT as a Service’ which provides full IT services to your desk, or wherever you choose to work, using virtual desktop and virtual server architecture. The IT service provides resilience, security, data backups, business continuity and desktop support.

Key Business ServicesBusiness Support

Case StudyVirtual Infrastructure

The Requirement Capital House required substantial refurbishment following its acquisition by the Group. The office move was also the ideal opportunity to move to a virtual infrastructure for IT services, driven by the need for flexible working and a desire to reduce IT costs.

The Solution The outsourcing division was tasked with managing the refurbishment and relocation, including the transfer to a state-of-the-art virtual infrastructure with minimum disruption to the Group’s business.

The refurbishment was completed on time and to a high standard. Simultaneously, the virtual infrastructure hosted in the Isle of Man was successfully implemented, with the business leaving two locations and opening the next business day in the new head office.

The ResultThe Group now operates a full virtual server and virtual desktop systems architecture, providing unrivalled capability and system integrity and the ability to operate remotely.

Group EthosCustomer Focus

We always try to ensure that the Group adds value from the customer’s perspective. This means we aim to put our customers at the centre of everything we do, thereby making it easier for customers to do business with us. This involves understanding customers’ needs in detail and then mapping internal processes and resources to meet these needs. It also requires the business to focus on delivering tailored solutions that add value to our clients, and which fulfil their requirements, rather than simply offering off the shelf products.

Therefore regardless of the product or type of account clients hold with the Group, clients and their nominated advisers can view the account online, at their convenience, anywhere in the world. Asset prices are updated daily, where available, to reflect the position as at close of business from the previous day as well as track historic transactions. We also provide the ability to download the data for integration into other office systems, offering a seamless and efficient administration process. For our institutional clients, we also offer online dealing services as well as automated uploads of bulk dealing requests via file transfers.

We pride ourselves on the service we deliver to clients. Not only do we place customers at the heart of what we do, we are keen to ensure that we are delivering what we aspire to.


In order to support and maintain our core values of Innovation, Integrity and Excellence, the Group is committed to a strong risk management and compliance environment. We consider this to be a key objective and a vital component, not only in the delivery of quality services to our clients, but also in recognition of our responsibilities in promoting the Isle of Man’s reputation on the international stage.

This commitment permeates throughout the Group with the Board of Directors of Capital International Limited able to present its Audit Assurance Faculty 01/06 report across its relevant areas of activity.

This reporting framework provides industry standard benchmarking against which to measure the relative qualities and strengths of the risk management controls in place.

The intention of this independent report is to allow our clients and their auditors to understand the means by which we conduct our business and how effectively we control and manage risk.

Business Integrity


The Group is committed to a strong risk management and compliance environment


The Capital International Group established its first international office in the heart of Cape Town at the beginning of 2014.

With its principal operational focus in South Africa being the provision of full discretionary asset management services, the Group is able to provide additional investment management support from the Isle of Man. In addition, the Group’s suite of products and services, which are delivered from the Island, can also be extended to those domestic investors wishing to take advantage of financial services outside of South Africa.

Broadening HorizonsThe Group in South Africa

Our team in South Africa are highly committed to providing a service that meets the core values that the Group was founded upon. Their primary focus is in on creating and maintaining solid business relationships with financial intermediaries, pension schemes, wealth managers, and life assurance providers. As those relationships develop and evolve so will our understanding our clients’ needs so that we can adapt, develop and create new and innovative solutions - further becoming a trusted partner in delivering our universal solution.

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Regulated activities are carried out on behalf of the Capital International Group by its licensed member companies.

Capital International Limited, Capital Treasury Services Limited, Capital Financial Markets Limited and Capital Fund Services Limited are all licensed by the Isle of Man Financial Supervision CommissionCapital International Limited is a member of the London Stock ExchangeRegistered Address: Capital House, Circular Road, Douglas, Isle of Man, IM1 1AG

CILSA Investments (PTY) Ltd, trading as Capital International SA, is licensed by the Financial Services Board in South Africa as a Financial Services Provider (FSP No 44894)Registered Office: Office NG101A, Great Westerford, 240 Main Road, Rondebosch 7700, South Africa

Isle of Man | Head OfficeCapital International GroupCapital HouseCircular RoadDouglasIsle of ManIM1 1AG

www.capital-iom.com

T : +44 (0) 1624 654200 F: +44 (0) 1624 654201 E: [email protected]

South Africa OfficeCapital International SAOffice NG101AGreat Westerford240 Main RoadRondebosch 7700South Africa

www.capital-sa.com

T : +27 (0) 21 201 1070 E: [email protected]


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