Yves Stein: “Competitiveness and resilience must go hand in hand”

At the ABBL General Assembly on 7 May, Chairman Yves Stein delivered a clear message: in today’s increasingly uncertain environment, Luxembourg’s prosperity depends on maintaining both a resilient economy and a competitive financial centre.

Against a backdrop of geopolitical tensions, economic fragmentation and accelerating technological change, he stressed that Europe is moving away from an era defined by predictability and stability.

A sector that remains strong

Despite a more challenging environment, Luxembourg’s banking sector continues to demonstrate solidity and adaptability.

Financial services still account for more than a quarter of Luxembourg’s gross value added, with banking representing over 40% of that contribution. Retail banking, private banking, corporate banking and depositary banking all continued to grow in 2025, while the sector delivered the second-best result in its history despite lower profits.

Banks also maintained their support for the economy through stable corporate and consumer lending, while mortgage lending linked to property projects increased significantly.

At the same time, Luxembourg’s financial ecosystem continues to diversify with the arrival of new fintech, payment, e-money and crypto players — a sign of the financial centre’s continued attractiveness.

But Yves Stein warned that resilience should never be taken for granted: “Strength needs to be maintained, defended and, where necessary, adapted.”

The ABBL’s role in a changing environment

The Chairman highlighted the ABBL’s role as a platform for dialogue, coordination and expertise.

In 2025 alone, the association issued 22 position papers in response to national and European consultations, reflecting its active contribution to regulatory and policy discussions.

Yves Stein also underlined the importance of close cooperation with the Ministry of Finance and the CSSF to ensure that rules remain workable in practice and aligned with operational realities.

He praised the Ministry of Finance for several initiatives aimed at strengthening Luxembourg’s competitiveness and attractiveness, including:

• proactive implementation of European legislation
• support for innovation and AI initiatives
• investment tax credits
• the new impatriate regime
• measures designed to improve the broader business environment

A European competitiveness challenge

Beyond Luxembourg, Yves Stein stressed that many of the sector’s key challenges are shaped at European level.

Referring to the ABBL’s response to the European Commission’s consultation on banking competitiveness, he outlined four priorities for Europe’s future framework:

• simplifying regulation
• reducing fragmentation within the Single Market
• ensuring a level playing field
• enabling digitalisation

According to him, excessive complexity and overlapping rules are increasingly affecting banks’ ability to finance the economy effectively.

He also argued that banks, fintechs and big tech players competing in similar activities should operate under comparable rules: “Same activity. Same risk. Same rules.”

Finally, he stressed that digitalisation must become an enabler of competitiveness rather than an additional source of regulatory burden.