Meeting LuxSE. September 1 st, 2015

Transcription

1 Meeting LuxSE September 1 st, 2015

2 Agenda 1. Luxembourg Financial Center 2. Presentation of LuxSE 3. Projects & challenges 4. Fundsquare 5. Main takeaways 2

3 1. Luxembourg Financial Center Overview 150 Banks 35 Germany, 15 France, 12 Switzerland, 10 Italy, 9 UK Investment Funds: SICAV, SICAF, SICAR, OPCVM (Organismes de placement collectif) National & international Law firms: Linklaters, A&O, Arendt & Medernach, Clifford Chance International Consulting firms: PWC, EY, KPMG, Deloitte, BDO 315 PSF (Professionnels du secteur financier): Streff, Luxtrust, Xerox, Bourse de Luxembourg Associations: ABBL, ALFI, LFF (Luxembourg for Finance) 3

4 1. Luxembourg Financial Center Why an exchange? Major reasons: 1. Matching Offer & Demand (Market) 2. Price transparency 3. Guarantee : Clearing& Settlement 4. Regulation 5. Anonymity Investor A Broker A Broker B Sell Sell Buy Buy Investor B 4

5 2. Presentation of LuxSE History (1/3) Founded in 1928 as an independent stock exchange 5

6 2. Presentation of LuxSE History (2/3) Serving the international capital markets for 50+ years 6

7 2. Presentation of LuxSE History (3/3) Synonym for innovation & transparency 7

8 2. Presentation of LuxSE An exchange not like the others 28 listed local companies 158 employees Revenue composition**: LuxSE, Deutsche Börse, SGX & LSE Shareholders: 54.7% : Local banks 32.9 % : Other institutional & private shareholders 12.4 % : Grand Duchy of Luxembourg Turnover of EUR 42.7 million* Wholly-owned subsidiary : Fundsquare (since 2013) Euronext partnership (since 2006) Listing Market Data & Services Trading Source: Annual reports 2013 of LuxSE, DB, SGX & LSE *2014 **Excluding revenues from other activities (e.g. clearing, settlement ) 8

9 2. Presentation of LuxSE Overview 3,000+ issuers 72 Sovereigns 12 Supranationals 40,000+ listings 66% Bonds 17% Funds 15% Warrants 2% Shares/GDRs 100+ countries USA, UK, China, India, Italy, Brazil, UAE 54 currencies USD, EUR, GBP, JPY, CNY, IDR, 10,600+ new listed securities in 2014 For a total issued amount of EUR 1 trillion 9

10 2. Presentation of LuxSE More than international issuers 10

11 2. Presentation of LuxSE Innovation A leader at the forefront of financial innovation for 50+ years Innovation at LuxSE: A predilection for international partners & products Continuous development to embrace new products 11

12 2. Presentation of LuxSE Markets A choice of 2 markets 75% Listings by market (Sep. 2015) 25% Euro MTF Exchange Regulated Market Bourse de Luxembourg EU Regulated Market Largest MTF in the EU +10,000 listings Approval by LuxSE Presence of top issuers Fast growing market since 2005 European passport +30,000 listings Approval by CSSF (Lux. Regulator) Long history since 1929 IFRS mandatory 12

13 2. Presentation of LuxSE A quality label Listing in Luxembourg : A unique full service process not matched by any other listing exchange Listed in Luxembourg : automatically implies Admission to trading i.e. collateral eligibility requirements In cooperation with Euronext: UTP platform & Cross-membership (BE, FR, NL, PT & LU) 13

14 2. Presentation of LuxSE Markets today NYSE Deutsche Börse Open-outcry auction market: A disappearing model Some showcases: Automatic trading: Standard model LuxSE* Euronext Brussels *Since

15 2. Presentation of LuxSE Indices LuxX Lux GDRs India Lux GDRs Taiwan Lux RI Fund Index Basket index of major Luxembourg listed companies. Weighted capitalisation indices comprised of all Luxembourg listed GDRs of the respective country Basket index representing Luxembourgdomiciled funds operating in the area of responsible finance. Since 1999 Since 2009 Since

16 3. Projects & challenges RMB business (1/3) Cooperation agreement with Exchanges from greater China: MoU with major Chinese banks: *Former GreTai Securities Market (GTSM) 16

17 3. Projects & challenges RMB business (2/3) RMB & Chinese issuers present at LuxSE: RMB denominated securities Chinese issuers 17

18 3. Projects & challenges RMB business (3/3) Stock & flow of Dim Sum bonds listed on LuxSE Source LuxSE Dim Sum bonds listed outside Asia* Source Bloomberg, LuxSE, LSE *Source Bloomberg, LuxSE, LSE 18

19 3. Projects & challenges Islamic Finance & LuxFLAG (1/2) Pioneers in European Islamic Finance in a few dates: st Islamic Finance institution st Sharia compliant insurance company st listing of a Sukuk on LuxSE Recognition of Islamic Finance products for tax treatment LuxSE already listed 16 Sukuk st Euro denominated Sovereign Sukuk (AAA rating) Latest Sukuk listings on LuxSE: Islamic Republic of Pakistan i.e. The Second Pakistan International Sukuk Company Ltd Grand Duchy of Luxembourg i.e. Luxembourg Treasury Securities S.A. Republic of South Africa i.e. ZAR Sovereign Capital Fund Proprietary Ltd Goldman Sachs i.e. Jany Sukuk Company Luxembourg provides an efficient legal, tax & regulatory framework for Islamic Finance *ongoing project exact date to be confirmed 19

20 3. Projects & challenges Islamic Finance & LuxFLAG (2/2) LuxFLAG, a possible bridge to Islamic Finance : ESG* labeled funds, complying with well defined ethical terms High synergy potentials between Islamic Finance & Responsible Investments Strategies: Contribute to further standardization of Sharia compliant instruments Eventually create Islamic Finance dedicated LuxFLAG labels Ultimately converge towards: o Reaching critical mass for Islamic Finance investment products o Harmonizing cross-regional compliance rules o Lowering costs / Increasing performance *Environnemental, Social & Gouvernance 20

21 3. Projects & challenges Investment funds & ETFs Listing investment funds & ETFs: a great potential Investment funds listed on LuxSE (As of January 2015) Enhance issuer s visibility & transparency of financial information Improve investor confidence with regards to information Provide eligibility for institutional investors o e.g. UCITS funds, insurance companies & pension funds Tax advantages for tracker funds Increase liquidity in niche products (e.g. collateral eligibility) 21

22 3. Projects & challenges High Yield bonds Leading European Exchange for High Yield bonds Market share of more than 60% In May 2014: Listing of a record 12 bn High Yield bond by Numericable & Altice High Yield bonds are one of the most traded types of securities on LuxSE Selection of High Yield bond listings in 2014: 22

23 4. Fundsquare Why the Fundsquare platform? Information Services Different collection point for many different types of fund data & documents Collection through not standardized tools & multi-formats Multiple transmissions of the same data Exponential cost in data administration, Order Management Services Increased operational complexity linked to Cross-border distribution of Funds Growing concerns of actors regarding costs, inefficiencies, redundant systems, disparate processes & lack of standardization 23

24 4. Fundsquare Need for efficient cross-border distribution of funds Single point of contact for: Asset managers, Fund distributors, Transfer agents Information & Reporting Services Fund data (static & dynamic) Reporting & statistics «Référentiel de place» Project Order Management Services Real-time order routing Commission & fee information Translation services 24

25 4. Fundsquare Fundsquare a subsidiary of LuxSE Fundsquare in some numbers: 900,000 KIIDS 75,000 Prospectuses & financial reports Feeding data to 110 distributors 69,000 share classes 7,500 funds 120 million NAV transmissions annually Fund information from 1,500 promoters 1.1 million regulatory reports transmitted annually 25

26 5. Main takeaways Solutions for international I. Issuers II. Asset Managers Access to international investors Visibility - Promotion Competitive pricing Supporting the launch & distribution of funds Listing on the Euro MTF market Fundsquare platform Increased comfort High transparency Easy access to information Pre-listing advisory services Efficient & predictable listing process One-stop-shop for regulatory reporting IV. Investors III. Listing agents, law firms & banks 26

27 5. Main takeaways Key action points Increase visibility of LuxSE: Strengthen presence in international markets Develop closer links with our key stakeholders Strengthen the position of the Luxembourg Financial Center: Support of LFF & ALFI promotion efforts Leverage the strong position of LuxSE Evolve with the market needs: Refine our product offering Enhance listing process efficiency Contribute to financial innovation: e.g. Virtual currencies, Responsible & Islamic finance, Crowdfunding, RMB internationalization 27

28 Contact details & links Maurice BAUER Secretary General More information on: Follow us on: