IMF Staff Country Reports

Luxembourg: Financial System Stability Assessment: Update

June 28, 2011

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International Monetary Fund. Monetary and Capital Markets Department "Luxembourg: Financial System Stability Assessment: Update", IMF Staff Country Reports 2011, 148 (2011), accessed December 26, 2024, https://doi.org/10.5089/9781455288656.002

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Summary

Luxembourg hosts a large international financial center that plays a pivotal role in its economy and in European financial markets. The crisis exposed significant vulnerabilities in Luxembourg’s financial system, owing to large cross-border exposures to foreign parent banks. The authorities proceeded with large public support to systemically important financial institutions under stress and with a fivefold increase in the deposit guarantee. Strengthening home-host supervisory collaboration and cross-border bank resolution frameworks will be of crucial importance for Luxembourg. Financial stability assessment and stress tests are also carried out.

Subject: Banking, Commercial banks, Financial institutions, Financial sector policy and analysis, Insurance companies, Mutual funds, Solvency, Stress testing

Keywords: Aggregate bank capital, Bank assets, Bank secrecy regime, Banking sector, Banking system, Commercial banks, CR, Europe, Global, Insurance companies, Investment fund industry, Investment funds, ISCR, Luxembourg-domiciled funds, Mutual funds, Parent bank, Parent banks of Luxembourg, Solvency, Solvency ratio, Stress testing, Subsidiaries in Luxembourg

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