There are many aspects to marketing, managing and operating the Holiday Property Bond, reflected in the various companies involved.
Paul Clark, Legal and Compliance Director of HPB Management Limited, explains the make-up of the HBP Group.
The HPB corporate structure chart illustrates the relationship between the different companies, and the individual functions of each.
HPB Holdings Limited owns the various HPB companies which issue, market and manage the Holiday Property Bond. That holding company is, in turn, owned by the Boyce and Baber families who helped establish HPB and are involved in its management to this day and by Isle of Man Assurance Limited - the privately owned Isle of Man company which was the original issuer of the Holiday Property Bond.
The HPB fund - that is the properties and securities - is operated by HPB Assurance Limited. However, legislation - and the trustee arrangements involving HSBC Trustee (Guernsey) Limited (see opposite) - ensure that the HPB fund is kept segregated and used only to provide Bondholders with the benefits offered by the Holiday Property Bond in accordance with a legally binding Trust Deed.
Importantly, the HPB fund does not own the companies shown in the corporate structure and is therefore not exposed to the trading risks of those companies.
The HPB fund pays to these companies only those expenses, initial charges and other fees - including annual management fees - that are specifically permitted under HPB's Trust Deed. The companies then pay their own operating costs, which include - for instance - marketing, running booking systems, accountancy, maintaining policy records, dealing with policy administration, and so on.
The cost of many HPB related publications, such as the BOND magazine, is met by companies in the HPB Holdings Group. They also cover the cost of nearly all the other publications in which HPB is promoted.
For an explanation of the Holiday Property Bond see "How it works".