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Luxembourg Gains Fund Assets, Report Says

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LONDON (–Luxembourg’s popularity as a fund domicile is definitely on the rise, with the total net assets for all collective investment funds growing to more than US$1.2 trillion as of the end of 2003.

Fitzrovia International released its latest research showing a significant boost from the US$883.2 billion in assets accounted as of year-end 2002.

Always a leading hedge fund jurisdiction, the growth of the business being done in the tiny Luxembourg grew by 13% in 2003, when the depreciation of the dollar against the euro is taken into account.

Of the products launched from Luxembourg most were global funds of funds, with 107 coming to market in 2003. Most of the growth came from U.S. fund managers who now make up the largest proportion of assets under management with US$291.8 billion. For the first time, U.S. fund promoters outpaced their Swiss counterparts, who only had US$271.5 billion in assets.

Drilling down to alternative investments, Fitzrovia logged in US$2 billion in asset growth with 105 funds managing US$7.66 billion in 2003.

Fitzrovia also ranks service providers in its latest report. UBS is the largest administrator in Luxembourg, while PricewaterhouseCoopers is the top auditor with 3,255 funds. JP Morgan is the top-ranking custodian with US$142 billion in custody.

The chief executive of Fitzrovia said in a statement that industry consolidation has helped increase the average fund size, which promotes economies of scale and ultimately helps investors, managers and service providers.

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