Raymond Frenken

Investment services powerhouse State Street, leader in Luxembourg’s asset services market, is undergoing a transformation. The upcoming integration of Brown Brothers Harriman, data management, ESG requirements, digital asset management and the rollout of its upgraded Alpha business platform are on top of mind for country head Ricardo Lamanna. “We create an environment where we progressively shift from being an operational organisation in Luxembourg to being a client-facing organisation.”

Jasmine Kang, Hong Kong-based portfolio manager at Comgest, recently visited Luxembourg and explained to Investment Officer how China sees the current global financial conditions as an opportunity to “decouple” and become more self-sufficient. China’s centrally managed economy is well placed in a world where rising interest rates, surging commodity prices and increasing geopolitical tension continue to haunt global investors.

Fund administrators active in Luxembourg will be required to produce an annual report on their governance and internal organisation from next year onwards as part of a long-awaited effort by financial supervisor CSSF to modernise a 30-year old supervisory framework in this field.

Luxembourg, Italy, Portugal and the Netherlands have all put forward candidates to succeed Klaus Regling as the head of the European Stability Mechanism, the 500-billion-euro eurozone bailout fund known as ESM. On Monday, the Eurozone finance ministers are due to decide on a successor for Regling, who steps down after a ten-year tenure and leaves behind a legacy at the Luxembourg-based ESM.

Europe’s asset management industry on Wednesday threw its backing behind a legislative proposal to give asset managers a bigger say in the application of liquidity management tools, or LMTs, at times of market stress. The managers, not the supervisors, should be responsible for deciding on the use of such tools,  the proposal says.

Apex Group Ltd continues to add management companies to its group through acquisitions. On Wednesday it said it plans to acquire the fund services and third-party management company business operations of Maitland International Holdings plc, an international fund services provider with a presence in Luxembourg, for an undisclosed amount. The transaction is subject to regulatory approval.

A university-sponsored wealthtech startup based in Liège, Belgium, is keen to make life easier for European fund managers that currently face sleepless nights. In 77 days, in the middle of the summer holidays, additional client suitability requirements will enter into force in the EU. It can change the way wealth managers interact with their clients.

Waving goodbye to what it calls “disflationary dynamics,” the European Central Bank on Wednesday sent clear signals that Eurozone interest rates will continue to rise for the foreseeable future after a first hike that could come as early as July. 

Luxembourg loves the new new thing, especially when it comes to financial legislation. The big question is: what should be next? The Grand Duchy may have found the answer already.

In the late 1980s, the Grand Duchy successfully tapped into global investment fund markets by becoming the first EU member state to offer Ucits-passports to international investment funds. Today, three decades later, more than a quarter of Europe’s fund assets has its home here. The country has even become a leading global funds hub.

Frankfurt-based Renell Bank AG, which publicly announced the acquisition of Belgium’s Merit Capital last October, remained silent on Monday on the demise of the Antwerp-based brokerage firm whose trading licence is being revoked.

Marc Renell, CEO of the German private bank, told Investment Officer that he is unable to comment. “I cannot speak about this topic. Go ask Merit in Antwerp,” he said when answering the bank’s general number listed on its website, before hanging up the phone.