Julie Becker, Chair of the Luxembourg Capital Markets Association (LuxCMA), tells us how it represents the common interests of all stakeholders in Luxembourg’s primary capital markets and its aim to be the single point of contact for authorities and market practitioners.
"Luxembourg is at the forefront of sustainable finance and fintech trends"
Could you give us a brief description of your young company’s activities and the reason it was created?
LuxCMA was established in March 2019 as a not-for-profit association, to be the voice of the Luxembourg capital markets industry and the go-between of choice between the authorities and all other industry stakeholders. Our mission is to promote capital markets both locally and internationally.
We act as a platform where our members can share insight and best practices and discuss the regulatory and legal issues most affecting our industry. We have specific task forces and working groups that are dedicated to the most important topics in our industry, and we share insights on the topics with our members through meetings, publications and webinars. We anticipate changes that will affect our industry and we put forward concrete, feasible proposals. We also actively engage with other market participants and industry organizations in order to align our efforts and multiply our impact.
How did the Deputy CEO of the Luxembourg Stock Exchange decide to get involved in this organization?
The Luxembourg Stock Exchange has a history of entering into partnerships and cooperating with multiple institutions. The exchange was invited by the founders of LuxCMA to join the association’s executive board, and I was honoured to be appointed as its chair.
Today, LuxCMA has around 40 members. Our members illustrate the dynamic and diverse capital market ecosystem in Luxembourg: law firms, professional services firms, banks, depositories, custodians and other financial institutions. The Luxembourg Stock Exchange is a key element of market infrastructure that works and interacts with multiple capital market practitioners in Luxembourg. We play a pivotal role in the primary market landscape and are often the last piece of the puzzle in complex primary market transactions. This puts us in an ideal position to understand the concerns and promote the interests of our industry.
How is Luxembourg different to other capital markets jurisdictions?
More than anything, what truly defines Luxembourg’s capital market is its global reach. Despite the country’s small size, the majority of international bond issuers worldwide opt for issuance, listing and servicing in Luxembourg. What’s more, Luxembourg is the leading fund centre in the European Union and number two in the world. What makes Luxembourg particularly relevant, in my view, is its position at the forefront of emerging trends, be they sustainable finance or fintech. These conditions have led to the creation of a dynamic and ever-growing ecosystem of service providers that together represent the core strength of the Luxembourg capital market.
Another aspect that sets Luxembourg apart is its innovative and business-oriented regulatory framework, which enjoys the active contribution of public authorities that understand the needs of the market. While it is continuously being modernized, the clarity and predictability of the legal framework in Luxembourg has also been singled out for praise lately, as a number of bond issuers have made the switch to Luxembourg law as the framework of reference for their funding programmes in light of Brexit.
"Luxembourg has proven time and time again that it is able to create great value by combining its strong position in finance with an agile and open approach to innovation"
You aim to promote Luxembourg’s capital markets. How do you provide networking and collaboration opportunities?
LuxCMA provides networking opportunities through meetings and webinars, and through the discussions and work done by the different task forces and working groups. Innovation is a key topic in our industry and high on our agenda. As an example, to celebrate our first anniversary, we are organising a series of webinars, two of them fully dedicated to blockchain. The potential of innovation enabled by automation and digital technologies is enormous for our industry and we, market infrastructures, intermediaries, depositories, issuers – along with authorities – need to work together to make it happen in a safe, robust and reliable ecosystem. Luxembourg has proven time and time again that it is able to create great value by combining its strong position in finance with an agile and open approach to innovation. Moreover, the renewed Capital Markets Union action plan, the EU Digital Finance Package with its Digital Finance Strategy, and the proposal for crypto-asset market regulation, along with the European Green Deal, offer a roadmap for new, innovative ways of doing business. We are following these developments very closely to make sure that our industry makes the most of them.
"Luxembourg is the leading fund centre in the EU and number two in the world"
How is the Covid-19 crisis affecting or creating opportunities for the industry?
The Covid-19 pandemic has had devastating social and economic consequences, and capital markets play a crucial role in the recovery efforts across Europe and the world. Capital markets need to support the real economy, drive innovation, and help reorient capital flows towards green, social and sustainable investment. Capital markets are more important than ever! We must create the conditions for companies, especially SMEs [small and medium-sized enterprises], to access market financing. The economic recovery from the crisis must be green, digital, inclusive and resilient. Through LuxCMA, Luxembourg’s capital markets practitioners can contribute to this important goal. As capital market players, we need to create ambitious, efficient and effective capital markets where we mainly measure our success by the impact we make. Together, we can create better capital markets, in Luxembourg and beyond.
Interview by Aude Ghespiere