While financial services business continued to move from offshore jurisdictions to “mid-shore” centers such as Singapore and Hong Kong during 2018, the Cayman Islands and British Virgin Islands managed to buck that trend, according to an industry survey released by corporate service provider Vistra.

The “Vistra 2020 Report” found that Cayman and the BVI moved up in the ranks of how popular various jurisdictions are in the financial services industry.

In 2016/17, Cayman and BVI ranked seventh and third, respectively, and in 2018 they moved up to sixth and second, respectively. Other offshore jurisdictions such as Jersey and Guernsey fell from ninth and 10th, respectively, to 10th and 12th during that same time.

Onshore centers U.S. and U.K. ranked third and fourth, respectively, while “mid-shore” jurisdictions – places with offshore traits such as low taxation and onshore traits such as well-staffed financial centers – Hong Kong and Singapore ranked first and fifth, respectively, in 2018. Vistra determined the rankings by surveying 800 financial services practitioners around the world.

Company formation statistics for Cayman and the BVI support Vistra’s findings that those jurisdictions increased in popularity this year.

For the first three-quarters of 2018, the number of Cayman-registered companies increased by about 7 percent from the end of 2017, reaching an all-time high of 106,291 at the end of September.

Likewise, new company formations increased by 11.2 percent for the first three-quarters of this year over the previous year in the BVI, according to Vistra. The BVI experienced the first substantial upswing in company formations since before Q2 of 2016, when the territory was rocked by the “Panama Papers” scandal – a series of media reports drawing from leaked documents, allegedly showing BVI companies being used for money laundering and other illegal activity.

The Vistra 2020 Report attributed the strong performance by Cayman and the BVI to their time-tested reputations.

“Our view is that these jurisdictions’ popularity reflects a growing preference for tried-and-tested service at a time of economic uncertainty,” the report states. “Both have earned themselves a reputation in a specific niche, with growth in the BVI and the Cayman Islands driven by expert capabilities in incorporations in the former and fund structuring in the latter.

“The two jurisdictions are also established trade routes for Asian businesses, which have seen more significant growth than other regions and – as we have observed in previous reports – still have a relatively strong demand for offshore and are loyal to [international financial centers] that provide consistently high service.”

However, Vistra’s survey also found that Cayman and the BVI are the two jurisdictions most likely to be negatively impacted by future regulations.

“Overall, and notwithstanding the recent strong growth, our respondents continue to predict that the BVI will be most negatively affected by changing regulation, followed by the Cayman Islands – while the US, and other onshore and mid-shore large financial centres, are expected to most benefit,” Vistra stated.