Guernsey's financial regulator has granted approval for the restructure of the EEA Life Settlements fund, following its suspension in 2011.

Guernsey's financial regulator has granted approval for the restructure of the EEA Life Settlements fund, following its suspension in 2011.

A statement from EEA's board of directors said that the Guernsey Financial Services Commission had granted the necessary regulatory approvals to allow the restructuring of the fund, effective 1 January 2014.

The fund was suspended in 2011 after it became inundated with unprecedented levels of redemption requests following a warning from the Financial Services Authority over the risks involved in investing in life settlement products.

Shareholders will continue to hold shares in the existing cells unless they elected to move to the corresponding run-off cells, EEA said.

EEA confirmed that around 58 per cent of shares will be moved to run-off cells, set up as part of the restructure.

The listing of the fund's continuing shares shall remain suspended pending a new listing application being received and being fully considered for the stock exchange.

"As was previously announced, each listing application will need to satisfy the applicable conditions of listing and the application review will include review of the latest financial statements," the EEA board said.

"There can be no assurance that the new listing applications will be approved and, in the event that application for listing of the continuing shares is not approved, the continuing shares will be cancelled from the official listing of Channel Islands stock exchange. The run-off shares will only be listed upon the listing application for such shares being approved.  A further update will be provided on this in due course," the EEA board added.