News

Luxembourg’s space sector is about to undergo a top level strategic review, with a reassessment to be made of the ambitious approach taken in recent years. This takes place against the background of the country’s satellite giant SES SA also reorienting itself.

For a second time in two years, investment fund managers have been ordered to directly report significant redemptions as the CSSF, the Grand Duchy’s financial supervisor, stepped up its monitoring of the impact from the war in Ukraine and the international sanctions against Russia.

Luxembourg fully supports the European Union’s additional sanctions against Russia over its aggressive move towards Ukraine but supports a cautious approach with the EU’s plans to eject Vladimir Putin’s country from the international payments system Swift. If that happens Russia will in essence be cut off from the world economy.

Spacs – special purpose acquisition vehicles – had a very good year in 2021, with some 600 Spacs raising 165 billion dollars but they are, like the rest of the economy, adapting to the new post-Covid economic reality. Many investment banking and legal experts active in the Spac field see them continuing to do well.

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.

The European Securities and Markets Authority (Esma), the EU’s securities markets regulator based in Paris, said on Tuesday that it continues to see high risks to institutional and retail investors of further, possibly significant, market corrections. 

Supervisors ESMA and EIOPA are “closely monitoring” cyber risks in Europe’s asset management industry amid concerns that rising tensions over Ukraine may spark Russian-backed cyber attacks on Europe’s economic infrastructure.

A leading German economist on Monday urged investors not to exaggerate financial risks around a possible Russian invasion of Ukraine, saying an invasion would merely lead to a “temporary setback” while underlining the need to put the Russia risk into perspective.

“All in all, we would expect the European economy and markets to rebound shortly afterwards from a temporary setback which a Russian attack on the Ukraine would probably cause,” said Holger Schmieding, Chief economist at German private bank Berenberg. “Let’s hope it does not come to that.”

In the search for yield, some high yield investors are shifting to a broader mandate to invest in “below B”, the riskiest segment of high yield. PGIM recently repositioned two high yield funds to invest in CCC and CC bonds.

Infrastructure is becoming a must in all portfolios. It is a decorative asset. Private companies are helping along with governments to achieve this. Whitehelm Capital’s fund continues to perform strongly and should benefit from major investment programmes in the major developed countries.