Alfi

Hopes are high in Luxembourg that the Grand Duchy this year will be able to claim a sizeable chunk of a growing European market for Collateralised Loan Obligations (CLOs), a structured financial product pooling corporate debts. With an update in its securitisation regime that allows active management Luxembourg wants to be competitive and seduce CLO managers from other countries, notably Ireland, to move their business. 

Luxembourg business representatives have said that the OECD’s Inclusive Framework Pillar One and Two corporate income tax proposals contain risks of excessive complexity, could put state tax authorities under pressure, increase the likelihood of litigation and could put competitiveness at risk.

Several major currents are affecting the alternative investing world as it attempts to appeal to a wider client base. These include technology (blockchain, tokenisation), sustainable investing and ‘retailisation’, which are said to be leading to the democratisation of alternative assets, which is trying to expand its customer base.

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.) 

BlackRock, J.P. Morgan Asset Management, Pictet Asset Management and Robeco were announced as the major category winners of the 2021 Broadridge Distribution Achievement Awards, presented at the ALFI Global Distribution Conference held on 21 and 22 September, according to a Wednesday press release issued by ALFI, which represents the Luxembourg fund industry.

UBS Asset Managers and Candriam Investor Group were among the “Fastest Risers”.

Luxembourg’s fund industry association ALFI has announced the appointment of its executive committee. The appointment was made by ALFI’s board of directors and publicised in an 8 July 2021 press release.

The members of the committee are:

VAT rules are a mess in the EU financial services sector. The current regime dates from 1977, well before the development of the cross-border business we know today.

Despite much talk about the cost and efficiency benefits of digitalisation and clients moving very quickly to adopt it, some parts of the fund sector still rely on manual processing. Some in the sector are calling for regulators to play an increased role in setting standards.

A panel entitled “Trends in fund distribution as investors have become more digital than ever - Is the fund industry ready?” discussed the current situation as part of ALFI’s recent Digi Pulse Amsterdam virtual event.

Mobilising long term private sector funding for ambitions such as the green industrial revolution is the stuff of policy makers’ dreams. Retail investors too want options which will give solid long-term returns. The ELTIF was the EU’s effort to give retail investors access to alternative funds, but it has failed to take off. Institutions need to drive reform and uptake.

Assets under management of Luxembourg-domiciled private debt funds have risen by 36% to €108 billion in 2020, according to the KPMG/ALFI Private Debt Fund Survey 2020. Investment Officer discussed the dynamics behind the popularity of the asset class with KPMG’s Valeria Merkel and Julien Bieber.