The Bank of Butterfield's subsidiary in Cayman has been made a listing agent for the fledgling Cayman Islands Stock Exchange (CSX), the bank revealed in its latest letter to shareholders.

Bank of Butterfield International (Cayman) Ltd., a significant player in the Cayman banking sector -- about 115 people of the bank's over 400 international staff are in Cayman -- is among the first ten entities to become a CSX listing agent.

Agents perform all due diligence for fund or securities listings and ensure applicants comply with listing rules.

Cayman opened the CSX on January 2. Its focus is on listing of offshore funds and Cayman companies.

The initial group of listing agents also includes leading law and accounting firms.

The bank's letter to shareholders stated: "This step compliments the developments of the group's investment services in the Cayman Islands.'' Bank of Butterfield International (Cayman) managing director Nicholas Duggan, attend the RIMS conference in Atlanta, could not be reached.

Asked if the CSX will compete with the Bermuda's exchange, CSX chairman Anthony Travers said: "We've never regarded Bermuda as competition.

"We take the view that the establishment of the CSX is a process that will develop over three to five years. We are setting realistic goals.

"Nevertheless, (a stock exchange) is essential to the offshore industry in the Cayman Islands.'' Mr. Travers, a senior partner with Cayman firm Maples and Calder, said the new electronic exchange is currently considering broker/dealer applications and subsequently be in a position to accept listing applications.

The CSX is a private limited company owned and funded by the Cayman government. In Bermuda, the Island's three banks own the BSX. BSX trading members have an option to acquire a total of 15 percent.

The Cayman bourse is also moving to obtain international recognition and expects its first designation in fourth quarter.

Last October, the BSX obtained a major designation, a DOSM (designated offshore securities market) from the Securities & Exchange Commission.

The CSX's main aim is to offer a listing facility to the 1,200 funds already domiciled in Cayman. Many Cayman funds have been forced to seek listings elsewhere, primarily Dublin, the April edition of Shore To Shore, a publication of the Isle of Man-based Offshore Institute, said.

The BSX has 62 funds listed with several more anticipated soon.

Matheson Investment Management (Bermuda) Ltd. CEO Kenneth Spurling said Bank of Butterfield International (Cayman) Ltd. had a local Cayman banking licence and would be expected to be a listing agent.

He also said: "Those who support reciprocity in financial services would say it would be much healthier if we allowed foreign institutions to sponsor listings on our exchange.'' Bermuda banks are accepted into other jurisdictions and freely allowed to do business but Bermuda does not allow all other financial institutions to freely conduct business here.

"In financial services, reciprocity is very much the way things are going,'' Mr. Spurling said.

The addition of more internationally recognised players to the market creates a larger market, he said.

"We have to join in and compete and allow others to compete on our ground.'' Matheson Investment Management is a member of the BSX and Mr. Spurling is a Bermudian with 30 years of experience in international financial markets.

Bermuda International Business Association chairman Tom Davis said: "Finance Minister Grant Gibbons said in his budget speech the Bermuda industries that are experiencing the best development are the ones that face competition.'' BSX chief executive officer William Woods reserved comment on the bank's becoming a listing agent, until after the next Minister of Finance's quarterly international business forum.

But in Shore To Shore he said: "Ultimately, there is only room for one bourse of this sort in this part of the world. Critical mass is very important and we'll achieve that in 12 to 14 months' time. My sense is that this is pretty much going to be a one horse show.'' BUSINESS BUC