Clarity on performance of Luxembourg private banks

Private banking has been at the heart of the financial sector in Luxembourg for almost five decades. From the simple savings account and the first Eurobonds exchanged over the counter in the ’70s to the most sophisticated financial products seen today, the private wealth management industry has grown relentlessly and in 2020 crossed the psychological threshold of EUR500 billion assets under management (AuM).

During these years, Luxembourg private banking has, of course, gone through many transformations, all headed in the same direction of enhancing the professionalization of the sector.

Without doubt, the incredibly strong growth of the investment funds industry in parallel — which has seen Luxembourg become the largest fund domicile in Europe, with more than EUR5,500 billion AuM — has also been an important contributing factor to the Luxembourg private banking sector’s growth, thereby providing an extended product offering to a greater number of institutional distributors.

In light of these rippling changes, KPMG and the Luxembourg Bankers’ Association (ABBL) joined forces this year to produce this study and provide a “State of the Nation” report on the private banking industry in Luxembourg.

More than a decade of accelerated AuM growth

Since 2008, the average annual growth in AuM has been 7.0% as, following a plateau between 2015 and 2017 (+1.7% annually), the rate of increase accelerated from 2018-2020 to reach 13.4% annually.

12 years
of AuM growth

EUR 508 billion
total AuM at the end of 2020

Up from

EUR 225 billion
in 2008

Explore trending topics about the development of private banking

  • The report’s research methodology
  • Key messages and trends for private banking
  • A Luxembourg market analysis
  • An overview of business and operating models in private banking
  • Understanding private banking industry performance
  • For comparison: a view on private banking in Switzerland

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