Cay Compass – Turmoil caused by the US financial meltdown will likely effect Cayman’s hedge fund industry.
Leader of Government Business Kurt Tibbetts acknowledged at the Cabinet press briefing Friday that Cayman’s economy “does not operate in isolation and that we are not immune from the global volatility and uncertainty”.
Although Mr. Tibbetts said preliminary consultations with the financial industry indicated the retail banking sector was not experiencing any problems, the story was different for other key aspects of the sector.
“The areas that are expected to suffer most are those connected with hedge funds and structured finance,” he said. “Current global market conditions in the hedge fund arena are characterized by heavy redemptions, suspensions and re–structurings coupled with much–reduced… new fund formations.”