Financial activities in Luxembourg rank as the most international-minded of all countries in the Benelux region. Take, for instance, the number of banks in the country. At the end of 2021, most of the 128 banks operating in the Grand Duchy were branches and subsidiaries of foreign banks, and approximately 64 percent of clients in private banking in Luxembourg came from other European countries. The country is an attractive place for both foreign investments and private clients. In the most recent Global Financial Centers Index, Luxembourg was ranked as having the tenth most competitive financial center in Europe. Luxembourg’s three traditional strengths involve its activities in investment funds, banking, and insurance.
How many registered funds are there in Luxembourg?
The investment fund industry of Luxembourg ranks among the biggest of the world. The total number of investment funds maintained its stability over the last years and reached a total of 3,548 in April 2021. These funds reached a value of net assets under management of approximately 5.86 trillion euros in 2021. The reason for Luxembourg’s success comes from the country’s combination of strict consumer protection along with its flexibility in fund types. At the end of 2021, the distribution of total net assets in the UCI sector (undertakings for collective investment, a term used for investment funds) shows that bonds represented approximately 25 percent.
Luxembourg’s international insurance industry
An appealing legal and economic framework helped Luxembourg establish itself as a hub for European insurance, most notably reinsurance. In 2020, the largest revenue of reinsurance companies in Luxembourg came from premiums out of Switzerland: more than 7.74 billion euros worth of premiums originate from this country. France and Germany are both responsible for roughly one billion euros worth of gross written premiums of reinsurance companies in Luxembourg. Unlike neighboring countries in Europe and much like Switzerland, Luxembourg has a strong international orientation when it comes to insurance.
