Disclosure on the UK Stewardship Code

BCI Capital is committed to being responsible in its allocation, management and oversight of capital on behalf of clients.

We acknowledge the high standards set by the UK Stewardship Code and its emphasis on effective stewardship to promote sustainable long-term value. However, given the nature of our investment strategy, we have chosen not to become a signatory to the UK Stewardship Code at this time.

Focus on Asset-Backed Securities (ABS) Lending

Our primary investment focus is on Asset-Backed Securities (ABS) and related structured credit products. As these investments typically do not involve direct equity holdings or voting rights in listed companies, the stewardship activities prescribed by the UK Stewardship Code, such as shareholder engagement and proxy voting, are less directly applicable to our operations.

Our Approach to Stewardship

Although the framework of the UK Stewardship Code does not fully align with our ABS-focused strategy, we remain committed to responsible investment and stewardship through alternative practices, including:

• Rigorous Due Diligence: Ensuring robust evaluation of underlying asset pools and counterparty risk,

• Monitoring and Engagement: Engaging with originators, servicers, and counterparties to promote transparency, ethical practices, and strong governance within the securitization process.

Commitment to Transparency and future considerations

We are dedicated to maintaining transparency and accountability in our investment practices. We continuously evaluate the relevance of the UK Stewardship Code to our business model and investment strategy. As the stewardship landscape evolves, we may revisit our decision and assess the potential to align more closely with the principles of the Code.

MIFIDPRU 8 Disclosures

1. Overview and summary

2. Remuneration arrangements

2.1   Qualitative Disclosures

2.2   Quantitative Disclosures

1.Overview and summary

This disclosure relates to BCI Capital Limited (“BCI” or the “Firm”).

BCI is authorised and regulated by the Financial Conduct Authority in the United Kingdom and is a Collective Portfolio Investment Firm (“CPMI”) holding a license under the Alternative Investment Fund Manager Directive (“AIFMD”), with top-up permissions to conduct MIFID activities. 

The Firm’s main activity is acting as the Alternative Investment Fund Manager (“AIFM”) to an overseas open-ended fund.

The Firm is classified as a Small and Non-Interconnected (“SNI”) investment firm with no Additional Tier 1 Capital in issue.

This disclosure has been prepared by the Firm in accordance with the requirements of MIFIDPRU 8 and has been approved by the Board of BCI.

This disclosure covers the period 1 April 2023 to 31 March 2024.

This is the Firm’s first disclosure under MIFIFPRU 8.

2.Remuneration Arrangements

As a SNI firm, the Firm is subject to the basic requirements of the MIFIDPRU Remuneration Code.

The information contained in this document has not been audited by the Firm’s external auditors, as this is not a requirement, and does not constitute any form of financial statement and must not be relied upon in making any judgement on the Firm.

2.1 Qualitative Disclosures

i. Approach to remuneration of staff

The Firm ensures that fixed and variable components of total remuneration are appropriately balanced. Fixed remuneration is based on a staff members’ experience and level of responsibility.

Variable remuneration is based on a staff members performance, or in exceptional cases, other conditions.  When assessing individual performance, financial and non-financial criteria are taken into account. Any variable awards are based on longer-term performance and, where appropriate, will be set in a multi-year time frame. Variable compensation is only awarded if the business  is able to meet its ongoing capital requirements.  All staff are eligible to receive variable remuneration. 

ii. Objectives of financial incentives

The objective of BCI’s remuneration policies and practices is to establish a culture which does not encourage risk taking which is inconsistent with the risk profile of the Firm and the long-term interest of its clients. BCI seeks to ensure that its remuneration arrangements facilitate the alignment of interest between members of staff and its clients.

iii. Governance arrangements

The Firm’s remuneration policy is reviewed annually to ensure it is appropriate and proportionate to the nature, scale and complexity of the risks inherent in the Firm’s business model.  The committee is made up of senior members of staff from BCI Capital and other group companies.

2.2 Quantitative Disclosures

As an SNI Firm, BCI is required to disclosure the total amount of remuneration awarded to all staff, split into fixed and variable remuneration.

The total remuneration awarded to staff in respect of the period ended 31st March 2024, was £1,323,698, of which £1,078,239 comprised fixed remuneration and £245,459 comprised of variable remuneration.