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27 February 2018

Luxembourg: 10 years and counting!

Alan Ross, head of our Luxembourg office, caught up with Funds Europe to discuss the Group's decade in Luxembourg and the evolution of the local funds industry.

When did the Aztec Group set up in Luxembourg?

The company was formed 17 years ago in Jersey by our CEO and founder, Edward Moore. It has grown from just five people and one client in Jersey to 750 staff across seven offices, administering over €270 billion for some of the industry’s leading investment managers.

We opened our Luxembourg office 10 years ago. In keeping with the Group’s organic approach to growth, this was a move driven by our clients’ evolving requirements, as Luxembourg was becoming increasingly central to fund structuring. Initially, the work in Luxembourg was for our existing key clients, but it is now the group’s fastest growing office and generates at least 50% of its own clients and acts as our onshore hub for the rest of Europe.

How has the local alternatives industry changed in that time?

In the beginning, we were mostly looking after holding companies and our work mainly involved domiciliations and company secretarial support. But this has changed steadily. Luxembourg is now the leading jurisdiction for the establishment and ongoing administration of alternative investment funds. AIFMD was, in many ways, the catalyst for this, coupled with developments such as the introduction of limited partnership legislation and the deregulation of the depositary function.

How much of an opportunity is Brexit for Luxembourg?

Brexit adds uncertainty – something that investors and fund managers seek to avoid. Therefore, for any fund looking to raise money or attract investors, it is an obstacle. We have seen some defensive moves from UK-based managers looking to establish an office in Luxembourg. The attraction of Luxembourg goes beyond Brexit. In my view, scrutiny and tax optimisation, as well as the AIFMD, have had a bigger impact.

What else does Luxembourg offer?

It is located in the heart of Europe with a stable supervisory regime, which has recognised the importance of the Luxembourg funds industry for over 20 years. There is also a strong, and growing, pool of talent. In our office, for example, we have over 200 people from 45 countries.

The infrastructure has also been designed to support growth. Office space, housing and transport links have all developed to meet the demand.

The one missing piece of the jigsaw remains the availability of experienced fund professionals, as this layer of talent only comes with time and the current growth in Luxembourg means that the numbers, although growing, are much sought after in the market.

Given the growth in the industry and the demand for fund professionals, how do you stand out as an employer?

Aztec Group is a people business and our value to our clients comes from our employees and the service they give. It is our goal to offer all our employees challenging and exciting roles, with ongoing professional training and development. In fact, more than 90% have completed, or are studying towards, a professional qualification.

And for the last decade, our staff retention figure has been 90% or above. We are genuinely committed to fostering a culture where we truly believe in, invest in and promote our people.

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