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In a recent report, credit rating agency KBRA (Kroll Bond Rating Agency) has affirmed Bermudas long-term issuer ratings and short-term issuer ratings of the sovereign.

The agencys stable outlook for Bermuda underscores its confidence in the islands ability to weather global corporate tax reform efforts without significant disruption to its status as a financial hub.

Key factors contributing to Bermudas continued strength as a financial center include its high wealth level, robust institutions, and a top-quality regulatory environment.

These factors underpin Bermudas reputation as a hub for international finance. Additionally, the islands innovative approach has positioned it as a leader in emerging financial industries, including fintech and digital assets.

While Bermuda does face challenges, such as a large government gross debt and financing costs relative to revenues, these concerns are offset by substantial external assets held in the governments Public Service Superannuation Flan (PSSF) and the Contributory Pension Fund (CPF).

Fiscal restraint remains a key policy objective, with the government targeting a $50 million surplus in the medium term.

Bermudas resilience in the face of global tax and regulatory reforms is notable. The report suggests that the anticipated implementation of a corporate tax in line with G20 global reform is unlikely to unduly affect the islands vibrancy as a financial hub.

Despite anemic pre-Covid GDP growth, Bermuda is poised for recovery, with improvements in hospitality, residential investment, immigration reform, and sandbox initiatives.

While tourism employment has been impacted, the strong international financial services sector and the gradual return of employment levels indicate positive signs of growth.

Bermudas external vulnerability has been reduced thanks to large current account surpluses, international investment surpluses, and substantial net external assets, particularly in the financial sector.

However, it remains vulnerable due to its lack of independent monetary policy and reliance on external funding.

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Bermuda's position as financial hub won't be unduly impaired by tax ... - Reinsurance News