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Bermuda’s foreign portfolio investment assets hit all-time high

Bermuda Monetary Authority headquarters in Hamilton (File photograph)

Bermuda's foreign portfolio investment assets surpassed $1 trillion for the first time in 2022, a new report from the Bermuda Monetary Authority reveals.

The Bermuda Co-ordinated Portfolio Investment Survey — 2022 Report shows that the assets reached nearly $1.1 trillion at $1,088.6 billion.

This represents an increase of 13.9 per cent, or $133.3 billion, compared with the value of holdings as of December 31, 2021 — and a staggering increase of $649 billion over the ten years since 2012.

The BMA said Bermuda's foreign portfolio holdings comprised approximately 55.8 per cent of total Bermuda financial services assets, down from 57.7 per cent in 2021.

The foreign portfolio holdings for Bermuda entities consist mainly of debt securities.

At the end of 2022, Bermuda's holding of foreign debt securities was $858.6 billion, representing 78.9 per cent of the island’s foreign portfolio holdings.

Debt securities were predominantly comprised of long-term debt securities, which accounted for 86.8 per cent, or $744.9 billion, of total debt securities when compared with $603.1 billion in the previous year.

Short-term debt securities amounted to $113.7 billion, accounting for the remaining 13.2 per cent of total debt securities, compared with $160.8 billion in the previous year.

Foreign equity holdings were $229.9 billion, representing 21.1 per cent of Bermuda's foreign portfolio holdings compared with $191.4 billion as of December 31, 2021.

The BMA said the CPIS is a voluntary data collection exercise conducted annually under the auspices of the International Monetary Fund.

The CPIS collects information about the cross-border holdings of portfolio investment securities in different economies. Portfolio investment is defined as cross-border transactions and positions involving debt or equity securities other than those included in direct investment or reserve assets.

Bermuda has participated in this exercise since 2001 and the island's numbers include data from the domestic and international financial sectors.

The BMA said the primary purpose of this study is to provide countries with estimates of their foreign portfolio assets at market value and to enhance the quality of statistics on global capital flow.

The island’s financial services regulator said Bermuda’s CPIS statistics are based only on data collected from the Bermuda Government and the financial services industry. The data does not include foreign portfolio holdings from other sectors (ie, non-financial corporations and households).

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Published November 29, 2023 at 7:59 am (Updated November 29, 2023 at 7:15 am)

Bermuda’s foreign portfolio investment assets hit all-time high

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