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Over 145 banks are established in Luxembourg from 24 different countries. Most are subsidiaries and branches of large foreign banks.

Luxembourg banks are supervised by the Commission de surveillance du secteur financier (CSSF), the financial supervisory authority.

Two types of banks can be established under Luxembourg law:

• Universal banks, which are authorised to perform all kinds of banking transactions.  Most banks established in Luxembourg operate as all-purpose banks;

• Mortgage bond issuing banks, whose activity is limited to the issuing of covered bonds.

Luxembourg banks offer a wide range of services including notably private banking, capital markets activity and corporate finance. Banks specialising in covered bonds benefit from a specific regulatory regime that enables them to offer securities with a high level of investor protection and strong credit ratings.

The establishment of a bank in Luxembourg is regulated by the law of 5 April 1993 on the financial sector, as amended, and requires authorisation from the Minister in charge of the financial sector.

Practical guide:
How to set up a bank