Luxembourg houses more than 300 management companies (mancos), which hold Ucits or AIFM licences (or both). They recorded growth of 6.3% in 2017, when 12 new mancos were also created, according to the PwC Luxembourg’s 2018 barometer on management companies, published on 16 May 2018.
According to PwC:
“The annual ManCo index measures the activities of management companies in Luxembourg based on the evolution of their assets under management (AuM), the number of structures and the number of employees in Ucits ManCos. This year’s index has also taken into consideration ManCos with AIFM licenses, given their growing relevance in the country.”
The barometer reports that:
“In December 2017, the index marked 195 points which translates into a significant growth of 6.3% over a year, the highest level ever reached. This remarkable growth has a twofold explanation: by the last quarter of 2017, there was a 12.7% rise in the AuM while employment in Ucits ManCos also saw a sharp increase reaching 4,344 employees in December (compared to 4,039 the year before).”
It further notes that the rise in the number of AIFM licensed mancos was slower than the Ucits, the latter growing by 1%. This is in contrast with the previous year when ManCos with an AIFM license had, for the first time ever, outpaced the number of Ucits structures. However, the number of so-called super mancos (carrying both Ucits and AIFM licenses) remained stable in 2017 at 124.
PwC remarked that, according to the index, Brexit is likely to have a positive impact on the Luxembourg fund industry, resulting in a rise in AuM in Luxembourg ManCos, leading also to a growth in mancos’ employment.
As Laurent Carême, director at PwC Luxembourg explained:
“Luxembourg is sure to benefit from its central location in Europe. Post-Brexit, the Grand Duchy is most likely to become the preferred location for UK-based companies who wouldn’t want to limit themselves geographically.”