Meanwhile, the Isle of Man has also seen an increase of 15.1 per cent in funds under management domiciled on the island with the total funds reaching $57.7 billion, up from the $50.1 billion managed to June 2007.

"These figures highlight the significant achievement for both our banking and funds industry and are a further step towards our targets for 2010. Our comprehensive regulatory system, without the unnecessary bureaucratic hurdles, has continued to attract new business despite the current market uncertainty,” John Spellman, director of the financial services division of the Treasury, said in a statement.

Many wealth managers are reporting that market uncertainties have pushed clients into disproportionately large cash holdings and that there is a huge amount of private client assets waiting to be re-invested when markets begin to recover.