Facing competition from other centres, Luxembourg has found ways to innovate, writes Jan F Wagner.
Despite the perceptions of many in western Europe, Luxembourg’s success as a financial centre is not down to its private banking industry alone. In fact, it has more to do with a financial activity that is a lot more mundane: the domiciling and administering of investment funds.

Jan F Wagner examines Luxembourg’s options for maintaining a competitive edge as the end of its tax-free status looms.
In Germany, Luxembourg is known for one thing only: it’s where rich Germans put their savings to shelter them from tax. This may sound overly simplistic, but it’s easy to see why the tiny country has gained that reputation.

The Bank of England isproposing reform of the sterling money markets in a bid to reduce the volatility of short-term interest rates. In what the bank says are the “most far reaching reforms for a quarter of a century or more”, it will replace the present system, which involves frequent bank intervention to stabilise rates, with an arrangement modelled on best practice that should minimise interest rate swings.

French government efforts to encourage mergers between state-owned and private banks are paying off, says Jan Wagner. But Germany’s Sparkassen are resisting efforts to get them to follow suit.

Turkey is endeavouring to meet requirements for EU membership by extending its IMF standby agreement to combat spiralling debt while attempting to recoup money that was used to rehabilitate shaky private banks. Metin Demirsar reports from Istanbul.

German mortgage banks are campaigning to develop a common legal definition and standard for covered bonds. The dispute was sparked last year by three UK banks issuing covered bonds which do not legally qualify as this asset class.

Ireland continues to be a magnet for foreign banks conducting international business, and some are now targeting the domestic retail market. Michael Imeson reports from Dublin.

Intesa managing director and CEO Corrado Passera tells Karina Robinson how he plans to keep the bank on an upward path after turning it around.

A new generation of directors, bankers, economists and politicians are determined that Portugal will be completely transformed, writes Peter Wise in Lisbon.

Portuguese banks have proved themselves buoyant in a challenging economic environment, diversifying and cost-cutting to achieve good results. Peter Wise reports.
Recession? What recession? Despite six successive quarters of economic downturn, Portuguese banks are achieving robust growth. Most of them outshone analysts’ forecasts by a wide margin in 2003 and several recorded their best annual results ever.