Coalition agreement: many of the ABBL’s proposals taken up

There is broad agreement between the new Government and the banking sector on the levers to be activated to strengthen the resilience of our economy and ensure the continued prosperity of our fellow citizens. “The text of the 2023-2028 coalition agreement demonstrates the central role played by the financial centre in our economy and the Government’s desire to strengthen its competitiveness”, commented Guy Hoffmann, Chairman of the ABBL. “We are also delighted to see that many of the proposals we submitted to the political parties during the election campaign have been taken up”.

In this article, we give you a summary of the points worth highlighting.

Housing

The government intends to organise a national meeting on housing with all the stakeholders concerned. Similarly, it plans to analyse, with the banks and supervisory authorities, the current situation regarding the granting of mortgage loans and to examine possible adjustments in line with European law.

The ABBL has already indicated its willingness to play an active part in these initiatives. The members of the Retail Banking Cluster have also prepared a memorandum for the attention of the Ministers of Finance and Housing containing an analysis of the situation and possible solutions to consider.

Attracting, training and retaining talent

The ABBL welcomes the idea of creating a High Committee for the attraction, retention and development of talent and has applied to take part in its work.

The other measures to be highlighted are:

• Developing university training in finance.
• Encouraging and supporting in-company training.
• Clarification of the regulatory and tax framework for teleworking.
• Facilitating the reorganisation of working hours and promoting greater flexibility.

Business taxation

The new government recognises that taxation remains an important lever for competitiveness. The following announcements should be highlighted:

• Adaptation in the medium term of the rate of corporation tax and municipal business tax to bring them closer to the average applicable in OECD countries.
• Encourage employee participation in company capital.
• Strengthening the bonus and impatriate schemes.

The ABBL intends to work closely with the Ministry of Finance teams on the concrete measures to be put in place in this context.

Regulatory framework

In general, the government’s approach to the transposition of European directives, i.e. “the whole directive and nothing but the directive”, is to be welcomed.

The fact that the financial centre has been heard on the need to strengthen the presence of Luxembourg nationals in European and international institutions is also a positive sign.

In addition, the ABBL will be closely monitoring the study that the government intends to launch into the review of the CSSF’s governance and funding structure.

Sustainable finance

We welcome the Government’s willingness to o promote sustainable finance and banks, along with other actors, have a key role to play in financing sustainable business models and assets. We need to work on concrete initiatives to strengthen Luxembourg’s position on the international stage in this area.

We will further put forward two proposals -> setting up a national register of non-financial company data and a digital register of the energy efficiency of each building, accessible to banks.

Digitalisation

Digitalisation is one of the main themes of the Government agreement.

In this area, too, it will be a matter of feeding the government teams in their reflections around the development of mutualisation initiatives within the financial sector as well as data sharing between public services and our sector.

Financial education

The ABBL and its Foundation’s long call for financial education to be included in school curricula has been heard.

Jerry Grbic, CEO of the ABBL, says: “Given the difficult economic situation and the multi-crisis context, the ABBL will continue to foster close and constructive dialogue with the various members of the government in order to play an active role in the responses to the challenges currently facing our country”.