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Economy and Banking Sector of Luxembourg

Financial Market Development

Financial Market Development
5.0 (max 7.0), 15th out of 138 countries
Banks' Soundness
6.1 (max 7.0), 9th out of 138 countries

According to World Economic Forum's Global Competitiveness Report 2017-2018, financial market development in Luxembourg is scored 5.0 out of maximum 7.0 and ranked 15th out of 138 analysed economies, trustworthiness and confidence of financial market is scored 4.9 (30th place).

Financial Market Development in Luxembourg.

Chart 1. Financial Market Development in Luxembourg. Source: WEF.


Soundness of banks is scored 6.1 bringing Luxembourg into the 9th place.

Soundness of Banks in Luxembourg.

Chart 2. Soundness of Banks in Luxembourg. Source: WEF.

Further Information

Deposit Guarantee Scheme

Maximum Protected Amount
100,000 EUR

Deposit guarantee scheme is a financial stability mechanism implemented in many countries to protect bank depositors against the loss of their deposits in the case when a bank is unable to meet its obligations to depositors by compensating certain deposits held by depositors of the bank. This compensation is paid out from the contributions which banks have made into a deposit guarantee fund.

From a depositor's point of view it is important to know:

  • if the depositor is eligible within the terms of the deposit guarantee scheme;
  • if the depositor's bank is a participant in the deposit guarantee scheme;
  • if the depositor's type of deposit is covered by the deposit guarantee scheme.

All these details about deposit guarantee scheme in Luxembourg are summarised in Table 1.

Scheme Participants
all credit institutions operating in Luxembourg
branches of non-EU banks
branches of Luxembourg banks abroad
Scheme Exemptions
branches of EU-banks (covered by their home countries)
Eligible Depositors
natural persons
  • residents of Luxembourg
  • citizens of Luxembourg
  • foreign residents
  • foreign citizens
legal entities
  • micro, small and medium-sized enterprises
  • companies
Non-Eligible Depositors
financial institutions
Covered Accounts
all cash deposits, for example
  • current accounts
  • sight or term savings accounts
  • certain certificates of deposit
Covered Currencies
all currencies, namely
  • EUR (Euro)
  • foreign currencies
Maximum Protected Amount
100,000 EUR
Temporary High Balance
2,500,000 EUR
Paid In Currency
EUR

Table 1. Deposit guarantee scheme in Luxembourg.

Further Information

Country Ceiling for Deposits

Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.

Local Currency (Euro)
Aaa (prime)
Foreign Currency
Aaa (prime)

Local currency (Euro) deposit ceiling for Luxembourg is set to Aaa (prime), foreign currency deposit ceiling is Aaa (prime).

Deposit Rates

Average Deposit Rate (Feb 2019, EUR)
0.04 %  (Jan 2019: 0.23 %)
In February 2019, an agreed annualised deposit rate in local currency (Euro) of new contracts with agreed maturity up to 1 year between credit institutions and households was 0.04% which was below the Euro Area average (0.32%).
Deposit Rates in Luxembourg.

Chart 3. Deposit Rates in Luxembourg. Source: ECB.

Banking Supervision

Banque centrale du Luxembourg

Banking Sector Structure

Number of Banks
136
Consolidated Assets (2017)
821.69 bln EUR  (-2.85%)
Recent Changes (2018)
new banks: 2, closed banks: 5

Currently there are 136 credit institutions operating in Luxembourg.

In 2017 consolidated banking assets in Luxembourg were 821.69 bln EUR. The consolidated banking assets' evolution is shown at Chart 4 below.

Consolidated banking assets in Luxembourg.

Chart 4. Consolidated banking assets in Luxembourg.

Recent structural changes (2013 - 2018) of the banking sector of Luxembourg are summarised in Table 2.

201320142015201620172018
Number of Opened Banks792352
Number of Closed Banks196655

Table 2. Recent structural changes in the banking sector of Luxembourg.

The list of the most recently opened banks in Luxembourg is provided in Table 3.

All the credit institutions operating in Luxembourg can be classified into several categories. Table 4 summarises the number of banks in each category.

CategoryNumber of Banks
Banks91
Branches of foreign banks44
Central banks1

Table 4. Number of banks by category in Luxembourg.

There are 44 branches of foreign banks from 14 different countries in Luxembourg. Table 5 shows 10 countries having the biggest number of branches in Luxembourg.

Country of OriginNumber of Branches
 Germany16
 China7
 France5
 Switzerland3
 Portugal2
 Sweden2
 Brazil2
 Ireland1
 Jersey1
 Spain1

Table 5. Number of branches of foreign banks in Luxembourg grouped by country of origin.