The U.S. Virgin Islands government plans to set up an entity to offer municipal bonds for obligors throughout the U.S. as part of a broader project to establish a financial center in St. Croix.
Gov. Albert Bryan, Jr., wants to start what he calls a Third Wall Street in Christiansted, St. Croix — one of the three main U.S. Virgin Islands. He hopes to attract financial institutions in insurance and reinsurance, securities and commodities trading, investment management, financial technology and others.
Global Impact Assets LLC, an infrastructure finance firm specializing in private credit bond underwriting, plans to open up an office in Christiansted, Bryan said.
GIA expects to start its USVI operations in the private credit corporate market, said Anthony Weeks, a USVI special economic envoy. Subsequently, it plans to partner with the USVI government to offer municipal bonds that will be triple-tax exempt.
Obligors from across the United States can issue munis through the entity, Weeks said.
"One critical aspect of such a plan is that Third Wall Street is not acting just as a conduit," said John Hallacy, president of John Hallacy Consulting. "Oversight, a regulatory framework, and transparency are essential to a smooth functioning financial environment."
He suggested regulators, including the Securities and Exchange Commission and Municipal Securities Rulemaking Board, could be interested in guiding the rollout.
"It is not clear at this time what other competition there is for this kind of industry activity," Hallacy said. "One thinks of the Cayman Islands. It would be a wonderful development if there is positive job creation on the island."
The planned downtown Christiansted location benefits from multiple governmental designations and qualifications, Weeks said. The city is a Qualified Opportunity Zone eligible for U.S. tax breaks. The Virgin Islands Economic Development Commission also provides benefits for companies and individuals investing there. Finally, the city is a U.S.-designated National Heritage Area.
GIA currently lends up to $20 billion a year but with this expansion to the USVI hopes to be lending up to $30 billion a year soon, Weeks said.
Bryan said the Third Wall Street project was an attempt to
Bond issuances in the initiative would be marketed as "Hamilton Bonds," recognizing U.S. founding father Alexander Hamilton's historic connection to St. Croix.
Weeks said he expected Global Impact Assets to start operations in Christiansted within 90 days.
Other possible financial-service companies are completing incorporation, registration and application processes associated with establishing operations through the Third Wall Street initiative, the governor said. The businesses include firms involved in international currency exchange and other cross-border financial services.
Weeks, who is also chairman and CEO of SEDI-CASE — an advisory group promoting business among the USVI, North America and East Asia — is leading the
Nissman said he is continuing to work with the U.S. Virgin Islands Senate to introduce the Delaware Commercial Code and to lower the capital gains tax to 10% on the islands.
Weeks said the Christiansted project has been dubbed "Third Wall Street" because the first is in New York City and the second in southern Florida.
