Evolution of the Luxembourg banking industry

Source: CSSF & BCL

Structure of banking assets
(total in EUR billion)

Source: CSSF

The asset breakdown has remained relatively stable over the last few years. Notably, the 7% rise in total assets in 2021 was mainly due to the corresponding increase in loans and advances to central banks, administrations and customers. Since 2018, the CSSF no longer reports financial assets held for trading separately, and these assets are split across the other categories.

Structure of banking liabilities
(total in EUR billion)

Source: CSSF

Credit institution and customer deposits remain the two primary funding sources for the Luxembourg banking market. The weight of customer deposits has steadily risen over the last few years, with the total increase amounting to more than EUR100 billion since 2018.

Banking performance outlook: income and expenses analysis

Source: CSSF

Starting 2020, the CSSF has excluded branches and representation offices outside of Luxembourg from these figures. The effect of this can be estimated to around 1 billion Euro on the overall income. While interest income dipped slightly, commission income grew by 17% due to the rise in Assets under Management, mainly as a result of the positive development of stock markets.

Source: CSSF

Total expenses rose again by 10.6%, continuing their upward trend of previous years. The main reasons for the enduring rise in other administrative expenses and employee costs are ongoing investments in infrastructure; restructuring and regulatory compliance; the wage indexation mechanism; and the increase in highly qualified profiles in the workforce. The exclusion of branches and representation offices abroad from the statistics starting 2020 has an impact of around 0.75 billion Euro on the overall expenses.

The report’s banking performance indicator section provides a more detailed breakdown and explanation of the changes in total operating costs for each bank category.

Source: CSSF

Explore the number and geographical origins of financial institutions from European countries.

Ninety-one of Luxembourg’s banks are from Europe, with 42% originating from Luxembourg’s three bordering countries.

Source: CSSF

Source: CSSF