In 2022, Luxembourg’s banking sector showed resilience despite global uncertainty, with stable activity and employment, and a modest 2% profit increase. Banks benefited from higher interest income but faced rising provisions (+400%) and structural challenges linked to compliance, digital and sustainable transformation costs. Capitalisation remains strong, with defaults (1.6%) below the EU average. The number of banks fell to 121, reflecting ongoing consolidation. Talent attraction and retention, especially in compliance, IT, and sustainable finance, remain critical for future growth. ABBL calls for measures to sustain competitiveness, stability, and the sector’s capacity to support the economy.
