Julius Baer: Why we chose Luxembourg
Swiss private bank Julius Baer is stepping up operations in Luxembourg. The global group chose Luxembourg to set up its European hub last year to serve clients across the EU. The bank offers a state-of-the-art booking platform in the Grand-Duchy for its European customers and will establish a new business hub in Luxembourg by the end of 2018.
Julius Baer is one of twelve Swiss banks using Luxembourg as a hub to export their services across the EU. The group of banks has a major focus on asset servicing, as well as a tradition of private banking.
“Swiss banks do not have access to the single market of the EU, so to advise clients we needed an EU banking passport”, says Falk Fischer, Chairman of the Board of Managing Directors at Bank Julius Baer Luxembourg.
In this context, the EU passport for the cross-border distribution of financial services is strategic in making Luxembourg a location of choice for Julius Baer.
“A second reason was to set up our European platform because of the state-of-the-art IT technology in Luxembourg”.
Stable political, legal and social environment
The bank was also impressed by the modern legal and regulatory framework and high culture of investor protection.
“Luxembourg is important to Julius Baer because of its financial stability, the access to the decision makers both in politics and with the financial regulator, because of its product know-how and because of the very stable legal and regulatory framework”.
Ease of starting a business
Julius Baer further strengthened its presence in Luxembourg with the acquisition of Commerzbank International S.A. Luxembourg, a fully-licensed private bank in 2016.
“We could do business from day one in Luxembourg because the technology platform was already up and running and fully fledged. The system used is the same as the global platform for the entire Julius Baer group, and it enables us to offer more flexibility in how we serve our European clients both domestically and in the EU. Going forward all customers in the European Union, are going to be served out of Luxembourg”.
Multilingual workforce with international mindset
The bank now employs more than 200 people from 20 different nations, in the former Commerzbank building, centrally located in the Kirchberg business district of the city. “The market for office space here in Luxembourg is liquid, so you will always find a suitable environment to set up your headquarters”, Fischer points out. “We feel comfortable here in Kirchberg because we have access to all the other market participants who are based here. The Big Four accounting firms and top legal companies are only a five-minute walk, so you can give them a call, make a project meeting, and you have the solution half an hour later”.
Modern and dynamic financial centre
Luxembourg’s wealth management industry is uniquely specialized in cross-border services. The financial ecosystem works in close collaboration together to explore new possibilities and develop new products.
“As a new CEO of a company here in Luxembourg, you can quickly build up healthy relationships with your peers, with the financial regulator and the government. When you need, for instance, a country manual for a particular country, to ensure that you fully comply with the European requirements and the local law of that particular country, you will get the advice in Luxembourg easily, and that is a significant advantage. It is very hard to find a similar location in the world where you have 192 nations in such a tiny spot, and you can get access to the government, to the regulator, to the European institutions so quickly, and that’s fantastic business wise”.
The eurozone’s leading international private banking centre
As a result, Julius Baer Luxembourg has become a centre of excellence for wealth management and innovation within the group.
“The Luxembourg environment gives us more opportunities, in particular when it comes to the international mindset and the structuring of private assets. Usually, wealthy individuals do not look for “plain vanilla” solutions – it’s usually about structuring their wealth, due to perhaps the assets being held in different jurisdictions throughout the globe, or invested in various asset classes. The Luxembourg structures and vehicles enable us to create bespoke solutions for wealthy individuals no matter where they are”.
The bank benefits from access to the services of a complete financial centre ecosystem that includes essential market infrastructures, such as the Luxembourg Stock Exchange and post-trade service providers.
“The time to market is crucial if you have a good idea or a client that has a specific request where you need to involve the regulator, a law firm and a tax advisor. Here the law companies and advisory businesses in Luxembourg kick in”, adds German national Fischer who recently moved back to Luxembourg after a three-year stint in London.
“Luxembourg is an easy place to live, and I enjoy the international environment. I like to have conversations with people from different nationalities, and I like to watch my kids grow up in a multilingual and international place like Luxembourg”, he concludes with a smile.
Communiqué par Luxembourg for Finance