Family Offices and Wealth Management - 31/05/2012DOWNLOAD
Earlier this month, Deloitte Luxembourg held a conference on ‘Family Offices and Wealth Management’ with the support of the Luxembourg Association for Family Offices (L.A.F.O.).
In the presence of over 100 family officers, bankers, lawyers, domiciliation agents, wealth management professionals, etc., Deloitte presented the outcome of a survey conducted in collaboration with the L.A.F.O., enabling actors surrounding the family office activity to better understand the characteristics of this market in Luxembourg. The survey results further underline the Luxembourg market’s particular situation on the European and worldwide scenes.
The outcome of the 35 interviews conducted for the survey presented at the conference revealed a market centred around 4 distinct categories of family office actors: the single-family offices, the multifamily offices, the bankers and a fourth category of experts named ‘other service providers’, which include lawyers, certified public accountant, domiciliation companies, notaries, etc.
The survey demonstrated that, for the interviewees, a family officer is seen as a global coordinator for wealthy entrepreneurs and wealthy families, as well as for medium wealth individuals with less than a €2 million financial wealth.
Qualitative factors, such as trust and confidence were pinpointed as more crucial than quantitative factors, e.g. wealth development and growth. Full transparency of the costs structure is seen as an important component in the relationship between the clients and their family office.
The results of the survey further revealed that long-term relationship is a key indicator to the client’s satisfaction measurement. A successful generational transition demonstrates the success of a family officer. .
The interviewees additionally raised the importance of network capabilities for a family office as an efficient, precise and immediate asset to client needs.
Other countries with a strong base in the family office market are Switzerland, the U.K., as well as Singapore. Nevertheless, Luxembourg has become well positioned on the global market to play an active role in the family office businesses, thanks to its extensive range of financial structuring, wide spectrum of services coupled with a stable tax and regulatory environment.
According to Stéphane Césari, partner at Deloitte Luxembourg: “A draft law regulating family offices in Luxembourg should be promulgated in the coming weeks. Once enacted, this legislation will provide customers with a double protection, first Family Offices will be directly subject to the requirements of professional secrecy, and secondly the CSSF will ensure a direct supervision, providing a strong de facto seal of approval. It is now for the family offices to take full advantage of this unique situation in Europe. Furthermore, with a proven expertise in financial structuring, a stable and multicultural environment, and a pragmatic approach, we believe that becoming a center of excellence for family offices is within reach of the Grand Duchy. "