U.S. Bank celebrates five years of growth in Luxembourg

The Global Fund Services location in the hub for international business and finance has deepened relationships with longstanding clients and new ones alike

In fall 2020, the middle of the Covid pandemic, U.S. Bank opened its first office in Luxembourg in a bid to support growth of its Global Fund Services business. Five years later, that bet has more than paid off.

“Our existing clients said they would come to Luxembourg if we opened an office there, and they did,” said Didier Delvaux, head of Global Fund Services Europe. “Our Luxembourg team services some of the bank’s largest clients, and the existence of this office has allowed us to deepen those relationships.”

Luxembourg’s favorable regulatory environment, cross-border fund servicing and private market innovation have turned it into a hub for both traditional and alternative investments in recent years. The small but wealthy country is the second largest investment fund center in the world after the U.S., with more than $8 trillion in assets under management.

Delvaux, with 30 years of fund administration and custody experience, joined U.S. Bank in 2020 as one of two employees to open the office. Today, some 60 employees work in the U.S. Bank office in the Kirchberg financial center, primarily supporting the alternative investment community. The team services 24 clients today, compared to none when the office opened.

Part of the challenge of building the Luxembourg team was replicating the U.S. Bank “customer-focused, can-do culture” while parachuting into a new market, Delvaux said.

“Our clients want to recognize the feeling they get when they are working with our teams in Milwaukee or New Jersey as when they deal with our Luxembourg office,” he said. “One of our biggest differentiators is our culture and expertise.”

The Luxembourg team is part of  U.S. Bank Europe, which employs more than 3,400 people across nine European markets. The Global Fund Services Europe team has more than $50 billion of assets under administration, with the Luxembourg office contributing nearly half of that amount.

The bank recently celebrated the five-year milestone with a large party at Casino Luxembourg, an art center in the heart of the capital. The speeches and socializing that marked the event were a far cry from the socially distanced opening party in 2020, where attendees received a bottle of Luxembourg sparkling wine in the mail to participate in a “virtual clink” to toast the office opening on a video call.

The U.S. Bank Luxembourg team specializes in private credit, which is one of the fastest-growing asset classes in the asset management business – and Luxembourg is the default location for clients to set up business for this type of product, Delvaux said.

“We’re in the right place at the right time,” Delvaux said. “For the next five years, the goal is to continue to offer a level of service that few in the industry can match. Then the only question is, how big and how quickly can we continue to grow?”