Am I optimistic about the future of depositary banking in Luxembourg? Yes, I’m unequivocally positive about what lies ahead. I see us riding a second wave of success, propelled by the transformative force of the AIFMD.
Imagine the first wave, ushered in by the transposition of the Ucits directive, as a precursor to the tidal force we’re experiencing now with AIFMD, with its European passport provision for non-Ucits funds.
I firmly believe that the alternative market will continue to surge ahead, fueled by both burgeoning investment prospects and the growing appetite among clients. Today’s successful startups are increasingly eschewing traditional market listing routes, while private banking clients, seeking alternatives to conventional investments, are turning to private equity for wealth growth.
But let me be clear: my enthusiasm for Ucits remains unwavering. As Europe strives for a Capital Markets Union to mobilise savings for sustainable transitions and industrial revitalization, Ucits funds stand poised for a bright future. Given the strains on banks’ balance sheets and the evolving financing needs across Europe, Ucits’ ability to attract public savings is indispensable.
But, as any seasoned surfer knows, riding these monumental waves demands more than mere luck; it requires grit, strength, agility, and an intuitive understanding of the currents. While not everyone in the Depositary Banking Cluster may be hitting the waves, the analogy resonates deeply with the ethos of our financial centre.
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Becoming an AIFMD depositary isn’t an overnight feat. It’s the culmination of decades of expertise honed within Luxembourg’s ecosystem, encompassing banks, mancos, consultants and law firms. This rich tapestry of knowledge, cultivated in the Ucits domain, now serves as the bedrock for nurturing the success of alternative fund promoters. Likewise, many Ucits clients now leverage on our expertise in the alternative sector to venture into this niche.
Our 2023 conducted with KPMG and thanks to the CSSF’s valuable input clearly highlights the diversity of services that our members have put in place, as well as the diversity of products and clients that they are able to serve.
Yet, none of this would be feasible without the oversight and support of a supervisory authority adept at navigating the complexities of our multi-jurisdictional landscape.
And in this journey, both the CSSF and our members stand as pillars of competence, steering us through the surging tides of international success.
is chair of Luxembourg Bankers’ Association (ABBL) Depositary Banking Cluster and CEO of European Depositary Bank SA. The ABBL’s “Depositary Banking & Custodian Services Survey 2023” can be found .