The Investment Qnest

Since setting up on the Rock little more than two years ago, Quest Financial Services has proved to be one of the mostforward-looking and innovative companies in Gibraltar's snowballing insurance sector. And this, along with the efforts of its CEO Steve Quinn and co-founder Chris Wahn, has encouraged growth that is impressive even by comparison with the fastest-growing sector as a whole.

From a three-strong staff in a single office, it has expanded to 19 employees operating in three separately defined departments — each occupying its own floor in the Main Street building into which Quest moved in June... to become the Rock's "only general insurance company with a door onto our busiest business artery," as Quinn points out.

Its growth from insurance man agement to the provision of general insurance products — for which Quest was licensed by the Finan cial Services Commission last year — was later accompanied by the establishment of an ancillary ser vice — helping financial service newcomers to the Rock to settle in. And earlier this year, following the introduction of new legislation, the insurance group also moved into the new field of hedge fund management.

"Quest is all about giving the cli ent an unrivalled quality of service at a competitive price," Quinn said when the company moved into pro viding insurance productslast year. And he added: "We are confident that we will bring more clients to the Rock in the next twelve months." That confidence appears to have proved more than justified.

Asa full-blown insurance broker age we search the market for the product best suited to our clients' needs and as we are not tied to any one insurer we can range world wide to find what is best and safest," Wahn told me recently when we discussed the growth of this aspect of Quest's business.

Both he and Quinn agree that although there has been a slow ing in growth of local insurance business in recent months this will change when the current tax issues in which Gibraltar has taken the European Commission to court are finally resolved.

"People want to do business in and with Gibraltar," Quinn says. "When this is sorted out business will surge ahead." And he expects Quest to surge with it, particu larly since legislative changes this year have opened the door to the company for local management of hedge funds.

Interest in this sphere wasboosted recently by the disclosure that for mer City "Wonder Woman" Nicola

Horlick's plans to open the complex world of hedge funds to wider participation through a new listed investment firm hoping to raise £1 billion in a venture that will offer smaller investors with as little as a couple of thousand pounds the chance to participate.

Most hedge funds look to an investment of at least £100,000 from participants and because of the nature of risk — seen by some as be ing greater than most retail punting — there has been an ongoing debate about the wisdom of allowing retail investors to take part in what is still regarded as part of the riskier end of the market.

Horlick's Bramdean Asset Man agement will seek a listing for its "fund of hedge funds". Alternative Investment Fund, on the London Stock Exchange early next year, according to a report in a Sunday newspaper. "The plan is certainly to target the mass affluent, rather than the very wealthy, investors," a Bramdean spokesperson said recently. "But we're not going to be marketing to widows and or

phans."

"We are looking at the possibility of marketing something similar,but Gibraltar-based," one local fund manager told me."We are testing the waters at present and,if there is the demand that we anticipate, we would offer investors participation for as little as £1,000."

In this sphere, Quest appears to have stolen a march on the other players and soon after the law changed applied for a licence to administer funds.

"Experienced investor funds are already a popular tool in the Chan nel Islands and we are sure that they will catch on here," Quinn explains. "Quest does not operate the funds, merely administer them, but since we were granted a license under the new legislation in May we have been setting up the necessary sys tems and processes and have been looking at markets in the UK and in Switzerland — where there appears to be a huge potential."

Quest probably will administer several funds which Quinn believes will be attractive investment tools for High Net

Worth

Individuals whether they are residentin Gibral tar or not.

"Essentially one is looking at an investment of about £100,000 —or investors who have cash assets worth something like one million Euros... and there are quite a lot of those around," Quinn says. "A fund of about £5 million is viable from a management point of view and we hope that at least one of the proposed Gibraltar projects will be up and running before Christmas." Others will be up and running early in 2007.

At least one of the funds which Quest will manage will be a prop erty-based fund investing in physi cal properties — "not only in Spain, but anywhere in Europe" — while another will be in equities and cash, And some of the profits from this particular fund will be passed on to charities," Quinn says.

The funds themselves have been put together by Carol and Malcolm Ruffell — a couple of financial ex perts who quit the UK "rat race" to take early retirement in Gibraltar a few months before Quinn and Chris Wahn hung out the Quest shingle on the Rock.

"They are probably the most experienced funds people in Gibral tar" Quinn enthuses. "Carol was head of compliance with Cofunds — the main competitor to Fidelity, one of the major fund operators in the UK — joining it when it was established in 2000.By the time she left the fund had £3.5 billion under management."

Her husband also has extensive experience and was group financial controller for Britain's Commercial Union and later chief executive of CU's PEP and ISA business.

"We were fortunate to have es tablished links with the Ruffells early on — and, of course, are now doubly fortimate to be working with them in the sphere of hedge funds," Quinn adds.

'Quest offers a variety ofservices to insurers xoishing to establish a presence in Gibraltar apartfrom guiding them through the initial set up phase. The firm provides for a variety of require ments including board representation, investment committee representation and all the usual day to day manage mentfunctions.