The use of the Cayman Islands as the preferred jurisdiction for the incorporation of securitisation vehicles can be traced back to the emergence of the Cayman Islands as a dominant jurisdiction for capital markets transactions during the 1980's. The Cayman Islands became the favourite centre for capital market transactions through the political and economic stability of the Islands, an effective judicial system, a favourable tax system, the absence of exchange control or currency restrictions, the availability of professional and support services and the presence of light but effective regulation which did not impact capital markets transactions.
The first bond issues using a Cayman Islands incorporated issuer were structured in the late 1970's and the volume of capital markets transactions grew significantly throughout the 1980's as the Cayman Islands was used by international corporations and financial institutions as the jurisdiction of choice for bond issuing vehicles to fund
