Luxembourg is well-known for its developed financial system, which is why a great number of European and overseas banks have established their presence in the Grand Duchy. The main laws governing the banking sector in Luxembourg are:
The last law issued targeting banks in Luxembourg was published in 2015 and concerns the reorganization of banks in case of insolvency.
Our lawyers in Luxembourg can offer additional information on the Banking Law in the Grand Duchy.
According to the Luxembourg Banking Law, in order to open a bank in the Grand Duchy one must obtain approval from the Financial Regulator, which is also in charge with issuing the licenses for branch or representative offices of foreign banks seeking to set up operations here. The Law on the Financial Sector (LFS) also establishes that any bank must have at least two managers who will be in charge with the daily operations carried out by the institution.
The minimum share capital to open a bank in Luxembourg is 8.7 million euros of which 6.2 million must be paid upon the incorporation of the company.
Under the banking legislation, banks can receive one of the following licenses in order to operate in Luxembourg:
These banks can provide the following services to both natural persons and companies:
Most banks in Luxembourg also offer specialized services tailored to the needs of large investors. These services usually include securitization, retail and corporate banking services.
For complete information about opening a bank in Luxembourg, do not hesitate to contact our local law firm.
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