Pierre Gramegna, minister of finance for the Grand Duchy of Luxembourg who led a delegation to Singapore, said that as two key international finance centres, there was an opportunity for both countries to share the “best practices” in private banking and asset management industries.
Gramegna said: “In both private banking and asset management, Luxembourg has made it a speciality to provide customized solutions to sophisticated clients with multi jurisdictional needs, while setting up legal frameworks that make us particularly attractive to investors and fund promoters. These factors allow us to act as a gateway into Europe just as Singapore acts as a gateway to Asia for clients here.”
We therefore see a strong opportunity to share best practices in these areas and build on existing connections between our two countries.”
Gramegna was speaking at an industry event organised by the Luxembourg for Finance, which is an agency for the development of the Luxembourg financial centre.
Luxembourg’s assets under management reached a record high of €2.7trn ($3.67trn, £2.14trn) in the first quarter of 2014, €94bn higher than at the end of 2013, and a large part of this growth was driven by net inflows.
According to the minister, Singapore is one of the top markets for Luxembourg-domiciled investment funds. Out of 2,418 funds registered for distribution, 1,678 are domiciled in Singapore and in terms of asset management groups distributing funds in Singapore, 49 out of the top 50 are Luxembourg- domiciled.
Speaking on the opportunities, Nicolas Mackel, chief executive of Luxembourg for Finance said: “As we embrace complete financial sector transparency, we foresee opportunities to collaborate on the promotion of global standards for the exchange of information.”
“We also hope to drive increased cooperation in cross-border financial services, wealth and asset management – particularly as the Undertaking for Collective Invest in Transferable Securities (UCITS) begins to significantly affect Asian investors.”
Promoting RMB
Luxembourg is also increasing its collaboration with China for the internationalisation of the Chinese Yuan and earlier this week, Luxembourg’s Central Bank and People’s Bank of China inked an agreement for designation of a Renminbi clearing bank in Luxembourg.
Also, during this week, the Association of the Luxembourg Fund Industry and the Asset Management Association of China (AMAC) signed a memorandum of understanding to deepen the collaboration between the two associations and to create mutually beneficial opportunities for their fund industries.
“As we move forward, we are increasing our collaboration with Chinese counterparts regarding Luxembourg’s role in the internationalization of the Renminbi, which Singapore also plays a major part in,” Gramegna said.
Luxembourg claims to hold the largest pool of RMB deposits in Europe worth over RMB79.4bn ($12.80bn, £7.46bn), while fund houses in Luxembourg managed RMB256.4bn worth of assets.
The delegation also included Marc Saluzzi, chairman, the Association of the Luxembourg Fund Industry (ALFI), Robert Scharfe, CEO of the Luxembourg Stock Exchange, and Yves Mass, chairman, the Luxembourg Bankers Association.
The minister also met with Singapore finance minister Tharman Shanmugaratnam to explore further cooperation between the two countries.
