Assets in Luxembourg Ucits funds rebounded in 2023 from a 22% drop in 2022, according to a report that also reveals the largest service providers in the country’s funds industry.
New data shows assets reached €4,460.5 billion in 2023 – a 5% increase on December 31st in the previous year.
The 30th edition of the Monterey Insight Luxembourg Fund Report, compiled by Monterey Insight, shows that a market rebound in 2023 led to an increase in total assets of serviced funds in Luxembourg – including unregulated funds – of 14% in US dollar terms and 10% in euro terms.
The figures for regulated collective investment funds increased by 9% and 5% in dollars and euros, respectively, while the unregulated market saw “spectacular growth” with a 37% increase in euro terms.
The figures show a distinct preference for asset managers to launch Article 8 funds under the EU’s sustainable investing regime. Among newly launched Luxembourg funds, 71 were under Article 9 of the EU’s Sustainable Finance Disclosure Regulation (SFDR), and 401 were under Article 8.
Amundi ‘surprise’ in rankings of largest Luxembourg fund managers
The research shows that the top four fund manager companies remain unchanged. J.P. Morgan continues to lead as the largest promoter/initiator of serviced funds, followed by Amundi in second place, DWS International in third, and Pictet in fourth.
In the Luxembourg ManCo/AIFM rankings of serviced schemes, J.P. Morgan Asset Management (Europe) retains its top position, a spot it has held for several years. DWS Investment also maintains its second place, while Amundi “surprises” by rising to third, pushing UBS Fund Management (Luxembourg) down to fourth.
Luxembourg’s largest fund administrators
State Street once again dominates all three rankings for fund administration, custody, and, together with IFDS, transfer agent services.
Specifically, the top two positions for fund administration remain unchanged: State Street is first, followed by J.P. Morgan Bank.
Caceis climbs to third place after acquiring RBC Investor Services Bank, while BNY Mellon slips to fourth.
The latest statistics from Monterey highlight the resilience and growth of Luxembourg’s fund market, driven by a surge in private assets
Luxembourg’s largest custodians
Among custodians & depositaries, State Street secures the top position with the largest proportion of assets under custody, followed by J.P. Morgan Bank. Caceis jumps to third, and BNP Paribas takes fourth.
Among transfer agents, IFDS/State Street again tops the list. Caceis moves up to second place, pushing J.P. Morgan Bank to third.
The merger of Caceis and RBC means BNP Paribas moves into fourth position.
Luxembourg’s main audit firms and lawyers
Among audit firms, PwC maintains its lead, with EY holding steady in second place. Deloitte “surprises” by taking third, ahead of KPMG.
Mike Delano, partner and asset and wealth management leader at PwC Luxembourg, said: “The latest statistics from Monterey highlight the resilience and growth of Luxembourg’s fund market, driven by a surge in private assets.”
The data shows that private equity/venture capital funds ranked third in terms of assets, with US$1,293.5 billion or €1,171.0 billion, across over 5,040 funds and sub-funds, making it the top category by number of products. Equity funds generally led the asset rankings, followed by fixed income.
For legal advisers, Arendt & Medernach leads by the number of funds, followed by Elvinger Hoss Prussen in second place. Allen & Overy retains third, while Loyens & Loeff climbs to fourth.
In the ranking by net assets, the positions remain unchanged: Arendt & Medernach first, Elvinger Hoss Prussen second, Linklaters third and Allen & Overy fourth.
Impressive market rebound
Karine Pacary, managing director at Monterey Insight, said: “The Luxembourg fund industry continues to demonstrate robust growth and resilience, as evidenced by the latest data. The market rebound in 2023 has been particularly impressive, with significant increases in total assets across both regulated and unregulated funds.
“The spectacular growth in the unregulated market, especially among LuxLPs and SOPARFI, underscores the attractiveness of Luxembourg as a hub for diverse investment vehicles.
“Additionally, the significant activity in newly launched funds and the strong performance of funds under the EU SFDR framework reflect the industry’s adaptability and commitment to sustainable finance.”
