Luxembourg

It is over a year since the end of the transition period that saw Brexit come into full effect and as regards financial services regulation, the UK still appears to be searching for a new direction. Or maybe this is the plan. Could the strategy be to talk about change for a domestic political audience, while keeping real divergence to a minimum? 

Luxembourg has a promising potential to further build on its global hub status for investment funds by encouraging management companies to expand their businesses into international fund distribution, according to Xavier Parain, CEO of FundRock, Luxembourg’s largest third-party manager of investment funds.

For a country that is well established as a global leader in investment funds, one might expect its people to embrace more risk when it comes to their financial investments. As it turns out, the love for cash deposits is as big as ever.

Luxembourg retained its lead last year as the biggest global hub for sustainable investment funds. Nearly half of all ESG assets in Europe now have a home in Luxembourg, according to LFF, while the appeal of the Luxembourg Green Exchange continues to grow.

There has been scant divergence from EU financial sector rules in the two years since the UK left the EU. Nor are there many clear future policy proposals. Hence little has changed for Luxembourg players marketing into the UK. Could 2022 be the year when things start to shift?

The EU braces for a legal battle over plans to label nuclear energy and gas as sustainable transition fuels. Luxembourg and Austria are preparing steps to have the proposed delegated act annulled.

Universal-Investment, the third-largest management company in Luxembourg, said on Tuesday that it has been appointed as the management company for the Luxembourg fund portfolio of Switzerland’s Fisch Asset Management. Increasing costs and regulatory requirements are mentioned as reasons for the transfer.

It may be only 8 years away, but many representatives of Luxembourg’s financial centre have clear visions of a 2030 of higher technology but also a commitment to ESG values, but which may be a challenge to bring about.

Luxembourg’s real estate investment sector has recovered strongly from the economic slowdowns caused by the ongoing global Covid-19 pandemic, according to figures released in the Association of the Luxembourg Fund industry’s (ALFI)  15th annual Luxembourg real estate investment funds survey. (Full version link below.) 

Luxembourg is by far the leading EU domicile for environmental funds, according to a new report by PwC. Assets under management in green funds in the Grand Duchy are greater than the combined totals of the next three largest domiciles for these products. This article explains why this might be so.