News

Supervisory practices in Ireland, Luxembourg and the Netherlands “appeared insufficient” during the years that Brexit pushed financial services away from the United Kingdom to EU member states, a peer review among European financial supervisors has found. Luxembourg’s supervisor disagrees with the review’s conclusions.

German judges handed down an important verdict this week: EU treaties are no obstacle to shared debt in the union. The ruling comes shortly after the European Commission called for new joint injections into the economy. “As an investor I would carefully reconsider my bond portfolio,” one critic warns.

On Tuesday, the German constitutional court in Karlsruhe ruled that “exceptional” EU loans to overcome problems caused by the Covid-19 pandemic do not violate European treaties.

Markets for depositary and custodian banking services in Luxembourg are “heavily concentrated”, with the top ten banks holding more than three quarters of all assets, the first ever survey on depositary and custodian services in the grand duchy shows.

Real Estate Investment Funds, or Reifs, in Luxembourg saw total assets climb by 26 percent in the year running up to the end of the third quarter, to 131 billion euro. The number of Reifs increased by 20 percent to 621 funds.

The latest edition of the Reif survey conducted by the Association of the Luxembourg Fund Industry, or Alfi, showed that multi-sector allocations remain the most popular strategy for Reif investors, with 49 percent.

Fresh registrations for alternative investment funds in Luxembourg, considered the top European hub for private investments, this month are at their lowest monthly level in nearly six years. Regulatory changes as well as market conditions are cited as a reason for the slowdown. Some issuers have decided to wait for the new year to avoid regulatory reporting in 2022.

Government bonds classified as sustainable or ESG securities continued to win market share during the third quarter as more of them were issued while the total amount issued in fresh state debt in Europe  declined.

No this column is not about sustainability, climate targets or Co2 emissions. But about the fable that energy companies are a reason why broad market profits need not fall.

Energy profits

Earnings-per-share of US energy companies included in the S&P 500 Index are up more than 250% from a year ago. But this does not disguise a fall in profits of the rest of the companies.

The construction industry and real estate are about to change, and so investing in property tech (or proptech) start-ups now is a good investment strategy. That’s the idea behind Rise PropTech Fund.

LuxFlag, the Luxembourg Finance Labelling Agency, raised awareness to market challenges faced in the impact investing space at a side event held on Monday at the EIB Benelux Pavillion at COP27 which is being held in Sharm el-Sheikh, Egypt. The event featured speakers familiar with the challenges of making investments with real impact and of the best way to move forward with sustainable finance.

Even clients with the most defensive risk profile stand to lose more than -12 per cent at Dutch asset managers this year. “Defensive clients have 2008 experience in their portfolios. And according to many, we are not even at the exit yet.”