Our strategy to continue being the largest corporate services and fund administrator in Europe requires continuous investment in technology and people, Chris Casapinta, country executive Malta and Italy desk leader at Alter Domus, says.

Can you give a brief background on Alter Domus as an international group and why was it set up in Malta?

Alter Domus has its origins in a Big Four accountancy practice in Luxembourg. It has been independently owned by its current management since 2003, at which time it was renamed Alter Domus.

Latin for ‘other house’, the name Alter Domus was chosen to reflect the relationship the firm is dedicated to building with its clients. Through quality, customised attention and proactive participation in the daily administrative matters of the entities under its management, the services Alter Domus provides have come to be viewed as an integral part of our client’s operations.

Alter Domus started off with approximately 65 people in Luxembourg. Today Alter Domus has 1,000 staff globally, among which 100 based in Malta.

Alter Domus offers comprehensive and fully integrated services in 19 offices and 12 desks located across five continents. Initially, we offered services that were mainly limited to domiciliation, accounting and administration. Nowadays, we have expanded our services to include fund administration, depositary, and regulatory support among others.

Although we offer a wide range of services, we have taken the conscious decision of limiting our services to a limited number of product segments, namely private equity, real estate, debt and capital markets and private wealth administration. We service nine of the 10 top private equity houses in the world and six out of the 10 largest real estate investors in the world.

Back in 2010, I started discussing with one of the founders on the possibility of setting up an office in Malta. We always thought Malta had a very complimentary service offering to Luxembourg. Thanks to this complementarity – with Luxembourg being an established jurisdiction in continental Europe and Malta being an emerging market with an Anglo Saxon way of doing business – we thought this could result in a good offering to our clients.

We also had discussions with existing key clients who also encouraged us to set up in Malta as they also intended to have more presence in Malta. On this basis we decided to set up office here and we started operating in 2011.

What is the strategy of Alter Domus as a group, and how does that tie in with Malta?

Our strategy is to continue to be the largest corporate services and fund administrator in Europe specialising in private equity, real estate and debt.

This requires a continuous investment in technology and people.

Malta is pursuing this strategy. We feel that there is place for us in the local market and in fact this strategy has led us to become one of most significant players locally in a relatively short time.

You sold your hedge fund business to a third party. How does this fit with your growth strategy?

Given the increasing regulatory measures, one needs to decide what to focus on. We were always focused on alternative asset classes and less focused on hedge funds, which we serviced in only two out of our 30 locations: Hong Kong and Malta.

We thought Alter Domus would be better off to continue focusing on our core business of our service offering in private equity, real estate and debt as opposed to hedge funds.

For some time now Alter Domus has been searching for a suitable expert hedge fund administrator that could take over and rise to the challenge of meeting the needs of its existing and potential hedge fund clients.

In order to ensure an efficient exit of the hedge fund business we sourced a suitable expert hedge fund administrator that could take over and rise to the challenge of meeting the needs of its existing and potential hedge fund clients.

In Malta, although our exposure to hedge funds was not small, we are confident that our focus on alternative asset classes will allow us to capture more business in this area and hence continue growing.

With such increasing pressures on tax and regulations, can businesses like Alter Domus still continue to grow?

Although the business is becoming challenging and costlier to operate due to fiscal and regulatory pressures, there still is place for growth if one identifies clients’ changing needs, swiftly invests in the new required processes and supports that such clients require.

Even with a backdrop of significant tax and regulatory pressures, investors will continue to invest and find new opportunities to make returns on their investment.

This means that they would continue to need investment vehicles where we would be able to assist them so that they can focus on their core activity as investors.

Theoretically there should not be too many barriers for more businesses to move to Malta

How is Malta doing in the sector and is there room for growth?

Malta is doing well. There is significant growth in nearly every sector of financial services, from insurance to asset and wealth management.

This is reflected in the current employment market where demand is higher than supply.

The financial services business is international and very technology based, which makes it very mobile – theoretically there should not be too many barriers for more businesses to move to Malta. Naturally we need to make investors feel welcome to Malta and give them the attention and level of service they expect.

What areas do you see Malta growing in?

I would say there is growth across the board – however, I definitely see more capital market transactions than what we have been used to in the past. There is also a growing demand for payment service providers that are seeking to be licenced in Malta.

Also, we are seeing clients who actually want to have more presence in Malta and they are seeking to have fully fledged offices with a number of employees, sometimes with the local operations being an outsourcing centre for the entire foreign operations. This obviously is creating more value.

Is there the human resource and physical space capacity for such growth?

Malta will always struggle with capacity – it’s an issue we see in most of the industries in which Malta operates in. However, we do need to find solutions around our capacity issues and it is not impossible.

With regards to HR, we need to continue to attract non-Maltese workers. We can also retrain people to move into the financial services industry.

With regards to office space we can convert unused factory space to office spaces. As for specialist knowhow, we have a great expat environment which can easily grow with more specialists in the various areas. The bottom line is: we are still far off from full capacity.

How do you attract human capital and what type of profiles do you usually look for?

Nowadays this has become a significant challenge and the situation is getting more difficult as the country is at practically full employment.

We typically look for young graduates or candidates who are about to graduate from university.

Due to circumstances in the market with lack of supply and also due to the fact that our clients often prefer to have our staff speaking their native language, we have ventured into recruiting staff from other locations in and outside Europe.

This has enabled us to increase the supply significantly.

We also work closely with the local universities to attract potential candidates – but this is definitely not enough so we are also looking at people who are already in the workforce and are looking for a change. The fact that we offer a truly international experience helps us to recruit more rapidly.

Staff having the opportunity to work on joint assignments with other offices on large international clients, short or long term secondments and other training opportunities. We also have a very good profit sharing model for all employees irrespective of their level so that the whole team has the opportunity to share in the success of the organisation.

What are the plans for Alter Domus for the short- to medium-term, internationally and in Malta?

Internationally and locally we will need to continue assessing the changes in the regulatory and fiscal landscapes to ensure our products and services are in line with our clients’ expectations.

We believe that in our industry there are still opportunities for consolidation, so we will be actively looking for such acquisition opportunities in the market.

Over the past years our focus has been mainly Europe and Asia.

With our first acquisition in the US announced recently, we plan to continue investing and growing in the US where we already have a very strong client base.

Particularly for Malta, we feel there is more space for us to grow organically and not through acquisition. We are confident that with our existing management team we will continue to attract the best talent in the market.

In order to achieve this goal, we are investing significantly in our teams, especially in overseas training, profit sharing schemes and other incentives.

With such investment in our resources, we are confident we will continue to attract top tier clients which, in turn will continue fuelling our dynamic expansion.