In the months after Hurricane Irma destroyed large portions of Road Town’s commercial district, both government officials and private sector stakeholders touted the financial services industry’s post-storm business continuity plans.

With a relocated commercial court and evacuated employees operating in other jurisdictions, stakeholders argued that registered agents could continue to provide the efficient service on which the sector is built.

Recently released Financial Services Commission statistics indicate their comments might ring true: 2017’s third quarter incorporation numbers came close to mirroring last year’s Q3 total, despite the storm’s destruction.

Incorporations are often viewed as a bellwether metric for the health of the territory’s financial services industry, which typically rakes in about 60 percent of government’s yearly revenue.

The FSC report cannot be considered a full account of Irma’s impact on the industry, considering the storm arrived on Sept. 6 and Q3 ended on Sept. 30. It does, however, suggest that the hurricane’s immediate effect on the sector was not drastic.

The FSC reports that 7,639 companies incorporated in the most recent quarter, a slight drop from the 7,766 incorporations during the same period in 2016.

It should also be noted, however, that 2016 Q3 had been the territory’s third-weakest incorporation quarter since at least 2003, when the FSC began releasing statistical bulletins. That title is now held by Q3 2017.

A loss of momentum?

The territory’s weakest quarter since at least 2003, and the only quarter since then with less than 7,000 incorporations, was 2016 Q2.

The 6,767-incorporation low mark came on the heels of the release of the Panama Papers, a trove of 11.5 million leaked documents that allegedly suggested that Panama-based law firm Mossack Fonseca used VI companies to help clients around the world hide their money from regulators and authorities.

The downtick continued through the final three quarters of 2016 and the first of 2017, each of which saw incorporation numbers far lower than their respective time periods in previous years. 

This year’s second quarter, however, altered that trend: 7,621 companies incorporated across April, May and June, an increase of nearly 900 incorporations from the year before.

The increase was the first year-to-year boost since 2014’s Q4 had more company incorporations than 2013’s Q4.

It also brought 2017 slightly ahead of 2016’s pace, with 16,316 companies incorporated through six months compared to 16,223 last year.

After Q3, however, 2017 is barely lagging behind, with 23,955 incorporations across nine months compared to 2016’s 23,989.

FSC officials could not be reached for comment regarding the newly released statistics.  

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