“Northern Trust has chosen Luxembourg following Brexit”: Steve David, Northern Trust

Chicago-based Northern Trust was one of the first financial institutions to announce the creation of an EU banking presence in Luxembourg after Brexit. Steve David, Northern Trust’s Luxembourg Country Head, explains how Luxembourg’s developed international finance ecosystem helped Northern Trust make the decision.

STEVE DAVID, LUXEMBOURG COUNTRY HEAD OF NORTHERN TRUST

How would you assess the fund industry?

It’s a key pillar of Luxembourg’s economy and contributes 8% to the GDP of the country. Over the last three years, the fund industry has grown from €3 trillion to €4 trillion. Luxembourg has really capitalized on the expertise it started building in the 1980s, when we implemented the first UCITS directive.

What made Northern Trust choose Luxembourg?

I don’t think there is a more international financial center on the continent than Luxembourg, given its multicultural environment. Northern Trust has chosen Luxembourg following Brexit as the future domicile for its EU banking presence, with London remaining the headquarters for the company’s business in Europe, the Middle East and Africa. We made this decision even not knowing the exact terms of Brexit. In the process, we made a comparison between Luxembourg and Ireland, and rated both locations highly. The balance leant towards Luxembourg because we acquired UBS Asset Management’s fund administration servicing units in Switzerland and Luxembourg recently, which added 1,000 funds and an extensive number of clients to Northern Trust.

What makes Northern Trust stand out?

Our asset manager and institutional investor clients require customized services, so we must treat them like a private bank does. This is our differentiating factor. We offer each client a lot of assistance and transparency, as well as access to our knowledgeable staff. Northern Trust also has a solid balance sheet, with a strong credit rating. This is important because clients buy not only a service, but also the brand Northern Trust itself.