Evolving, resilient, and globally poised
The Depositary Banking & Custodian Services Survey 2025, developed in partnership with the CSSF and ABBL, offers a sharp, market-focused snapshot of Luxembourg’s depositary and custody sector. From emerging product trends to shifting competitive dynamics and workforce transformations, the report sheds light on how the industry is bolstering operational resilience in an increasingly complex global landscape.
Explore the key findings below to see how Luxembourg’s depositary and custodian ecosystem is evolving and reinforcing its stature on the world stage.
Our participants in numbers
Key takeaways
- Depositary banking results
- Private equity and FoFs
- ETF momentum and ELTIF
- Assets under custody (AUC)
- Custody
- Workforce
Depositary banking results
Deposit growth surges, yet few players capture the gains
Overall deposits rose 13%, fueled by new clients and strong economic activity, but the majority of growth remains concentrated among a handful of institutions.
Luxembourg’s depositary banking sector has seen a strong acceleration in deposit growth, rising 26% since 2022, with 63% of this increase concentrated among five key institutions. This momentum is fueled by favorable market conditions, notably in US equities, and continued onboarding of new clients and funds. Luxembourg’s appeal continues to strengthen, attracting promoters from the US and Eastern Europe thanks to its stable regulatory framework, multilingual workforce, and agile decision-making environment.
Traditional fund structures remain the cornerstone of Luxembourg’s financial ecosystem, with UCITS maintaining their dominant 65% share of total AuD and growing 11% year-on-year. At the same time, alternative funds continue to expand rapidly, RAIFs up 34% and other AIFs up 25%, driven by rising investor appetite for private markets. This balance between traditional and alternative vehicles underscores Luxembourg’s strength as a versatile fund hub serving both retail and institutional investors.
AuD per Funds types in Bn EUR as described in LFR
Private equity and FoFs
drive new complexity
Depositary banks are navigating increasingly sophisticated private asset classes as growth in alternative investments accelerates.
Private equity and fund of funds represent a substantial share of Luxembourg’s €3 trillion in alternative AuD, driven by strong demand for long-term, diversified investments. Luxembourg’s regulatory transparency, structuring flexibility, and robust fund servicing make it a preferred hub for complex strategies, with depositaries strengthening oversight and risk management. Meanwhile, transferable securities remain dominant at 66% of total AuD, while real estate funds have stayed stable over the past two years.
Growth from 2023 to 2024
*Transferable securities (Equity fund/ Bond fund/ Mixed fund)
**e.g. hedge funds, movable property, infrastructure, syndicated loan, timber, crypto asset etc.
ETF momentum and ELTIF
growth on the rise
Two market segments are demonstrating strong potential, highlighting opportunities for strategic expansion and investment.
ELTIFs are experiencing a boom, nearly doubling in size over the past year, while ETFs continue to grow steadily, up 29% year-on-year. Luxembourg captures the majority of this expansion, more than half of existing ELTIFs are domiciled there, reinforcing its position as a leading hub for both traditional and alternative fund structures despite strong international competition.
Growth from 2023 to 2024
Assets under custody (AUC)
hit new heights
Custody volumes are rising across all client types, with growth increasingly driven by non-traditional segments.
The positive trend, driven by new client onboardings, stronger economic activity, and favorable USD equity markets, led to solid year-on-year growth.
Credit institutions, along with clearing and settlement institutions (up 6% and 12% respectively compared to 2023), remain the main holders of AUC in custody.
Custody
growth spreads across the board
Both large and niche custodians are seeing consistent gains, reflecting broad-based momentum across the sector.
Market concentration remained stable, with the Top 5 custodian banks holding around 67% of total assets (€2.63tn) and the Top 10 reaching 83% (€3.3tn) in 2024. The sector remains highly concentrated, with a continued trend toward consolidation despite growth across all market tiers.
Total assets under custody concentration
Workforce enablers insights
Strategic workforce shifts in Luxembourg
The market is tapping global talent pools to maintain and enhance operational excellence.
Luxembourg maintains strong in‑house expertise, focusing on complex operational and supervisory functions to ensure regulatory rigor and high-quality service. While overall workforce levels in Custody Operations and Depositary Supervision remained stable in 2023‑24, there is a growing emphasis on specialized, senior roles and forensic expertise. Investment in automation is also streamlining traditionally manual processes, boosting efficiency, control, and profitability.
Redefining trust in depositary banking
Our depositary and custodian services bring together regulatory insight, risk discipline, technological innovation, and strategic transformation to help institutions stay compliant, resilient, and ahead of the curve.
