Investment Officer Luxembourg

Luxembourg is heading to the polls on Sunday. The outcome is anticipated to reaffirm the Grand Duchy’s status as an international financial centre rooted in political stability. Two issues, however, stand out: talents and taxes.

The private debt market’s robust growth is largely attributed to tighter regulations imposed on commercial banks. A recent US banking crisis, coupled with stricter Basel IV norms, propels this surge. Additionally, tight monetary policies are leading to a notable spike in fees, particularly in relation to risk. Consequently, a promising asset class has quickly taken shape.

This week’s overview of transfers, appointments and promotions includes updates from Fidelity, KPMG Luxembourg, Kneip, Creutz & Partners and Allen & Overy.

The European Central Bank (ECB) has recently reported that money growth in the eurozone saw a decline in August. The M3, a broad measure of money supply, witnessed a drop for the first time in over a decade.

This further dip in money supply during August is encouraging news in the context of inflation targeting. Excessive money growth can lead to high inflation in the medium term.

The Luxembourg government, represented by prime minister Xavier Bettel and finance minister Yuriko Backes, on Tuesday officially inaugurated Bank of America’s new branch in Luxembourg. The office was already opened on 10 May.

The sustainable finance sector has faced a whirlwind over the past two years, and the storm shows no sign of abating soon. From greenwashing scandals and SFDR downgrades to unreliable ESG data and politicised debates in the US, the landscape is ever-evolving, almost on a daily basis.

After a significant reclassification wave last year, many hesitate to award their funds the highest sustainability label, lacking the commercial upsides of SFDR 9 reporting.

European ESG funds face a record number of closures as greenwashing scrutiny intensifies and the allure of higher fees diminishes, data shows.

Investors often overlook the growth potential of companies exposed to megatrends like the energy transition and artificial intelligence. Those who discern the transformative potential early and stay invested might reap significant returns in the next decade.

The European Securities and Markets Authority (Esma), the EU’s financial markets regulator and supervisor, on Tuesday said it plans a comprehensive review next year of industry efforts to integrate sustainability in investment firms’ suitability assessment and product governance processes and procedures.

The review will be shaped as a Common Supervisory Action, or CSA, in which it closely involves national supervisors such as the CSSF in Luxembourg.