Annual Report 2025
WELCOME
Together we go further
We are pleased to present the ALFI Annual Report 2025, a comprehensive overview of our association’s milestones and the collective achievements of our industry over the past calendar year.
To our members: thank you. Your continued support, trust, and expertise have played a pivotal role in our achievements throughout 2025. In a period defined by evolving regulatory landscapes and a shifting global economy, your active engagement remains our greatest asset. Your input continues to shape our agenda, drive progress, and unlock new opportunities for the Luxembourg fund industry, from the continued growth of alternative investment funds (AIFs) and ELTIFs, to the expansion of active ETFs, and our ongoing work in tokenisation and sustainable finance. Furthermore, our constant engagement with local and European regulators ensures that the Luxembourg and European fund industries remain relevant and ahead of the curve.
This report reflects our commitment to shaping regulation, promoting the Luxembourg fund industry worldwide, and making the Savings and Investments Union (SIU) a reality. It also highlights our dedication to delivering valuable research for our members and the broader market. Within these pages, you will
We look forward to continuing this journey with you, working side by side to shape the present and future of the global fund industry.
Enjoy!
INTRODUCTION FROM LEADERSHIP
by Serge Weyland, ALFI CEO and Britta Borneff, ALFI CMO
In the first episode of the Annual Report podcast series, Serge Weyland and Brita Borneff discuss the market trends shaping new business for Luxembourg. A clear conversation on where the market stands and where Luxembourg could go next.
Read more
Luxembourg enters its next growth phase with two clear strengths: scale and diversification. By the end of 2025, assets under management had reached EUR 8.3 trillion. Alternatives rose from EUR 2.6 trillion to EUR 3.1 trillion in just one year, up 20% despite challenging private market conditions. ETFs also continued to gain ground in 2025, with Luxembourg attracting 27% of net European inflows during the year (Source: CSSF/ESMA). Its cross-border distribution model remains a decisive advantage. Luxembourg-domiciled funds are distributed in more than 70 countries, extending the industry's reach well beyond its domestic market and providing access to investors across Europe's 450 million citizens, as well as increasingly to global investor pools.
New momentum could now come from the EU's Savings and Investments Union, which aims to channel more household savings into capital markets. For Luxembourg, this could translate into new business opportunities, evolving product structures and deeper long-term retail participation. The next wave of growth is likely to come from beyond Europe. India stands out, driven by strong economic growth, improving financial literacy, and growing retail participation in public market funds, even if equity investing still reaches only a small share of the population. In Latin America, Brazil provides scale, with EUR 1.9 trillion in fund assets and a new regulatory framework that allow Brazilian feeder funds to invest fully in Luxembourg UCITS. Chile's pension reform and the Gulf's increasing allocations to alternative assets reinforce that momentum.
Sustainable finance is no longer a niche. Luxembourg now accounts for 31% of Europe's sustainable public market fund assets, representing EUR 850 billion. Across both public and private markets, sustainable assets reached EUR 1.6 trillion by year-end. next chapter, however, will not be written by distribution alone. AI, tokenisation, and blockchain are set to change how funds are designed, distributed and accessed. The goal is becoming clearer: not just to remain Europe's leading fund hub, but to position Luxembourg as a global capital-routing centre connecting Europe, Asia, Latin America and the Middle East.
THE YEAR AT A GLANCE
The following infographics highlight how Luxembourg’s fund market performed in 2025. They also showcase, in a nutshell, ALFI’s promotional efforts and strategic work on regulatory and industry matters.
STATE OF THE INDUSTRY
In 2025, Luxembourg consolidated its position as Europe’s leading fund domicile, with assets under management reaching EUR 8.3 trillion and continued growth across alternatives, ETFs and sustainable finance.
ALFI ORGANISATION
ALFI today represents domiciled investment funds, asset management companies and a wide range of businesses that serve the sector. Our members are investment funds, management companies, asset managers, alternative investment fund managers (AIFMs), depositary banks, legal and consultancy firms, tax advisory firms, auditors and accountants, specialised IT and
communication companies and individual members.The diverse composition of our governing bodies reflects our commitment to inclusiveness and broad representation.
KEY TOPICS IN 2025
CONNECTING SAVINGS WITH EUROPE’S ECONOMY
Europe has no shortage of savings. What it lacks is a stronger culture of investing.
TOKENISATION/CRYPTO-ASSETS
Fund Tokenisation: from experimentation to scale. How Luxembourg shapes the future of investing in Europe.
RETHINKING RETIREMENT IN EUROPE
How to turn long-term savings into stronger retirement outcomes?
INVESTING IN HIGHER EDUCATION
Academic excellence meets industry needs. ALFI commits to preparing the next generation of finance professionals.
CORPORATE RESPONSIBILITY AND CITIZENSHIP
This section reflects on 2025 corporate citizenship actions centred on three core pillars: fostering education and talent development, strengthening our environmental practices, and promoting diversity and inclusion within our industry and community.
HIGHLIGHTS OF OUR WORK
In 2025, Luxembourg continued to strengthen the legal and regulatory framework of its fund industry.
From private assets to UCITS and ETFs, a series of reforms and regulatory updates helped make the jurisdiction’s structuring toolbox more competitive, more flexible and better adapted to market needs, without compromising investor protection. Among the most important developments was the reform of the carried interest regime, which brought greater clarity and improved the framework for a broader range of beneficiaries. Luxembourg was also among the first EU member states to move forward with the implementation of AIFMD II and the revised UCITS rules. This has provided the industry with early legal certainty on key issues such as liquidity management, delegation and loanoriginating funds.
At national level, regulatory modernisation continued through updated CSSF guidance for SIFs, SICARs and Part II UCIs, with a more streamlined and principle-based approach. This was complemented by measures designed to simplify certain structuring and operational aspects, including proposals affecting private limited companies and practical changes for fund set-up.
Taken together, these changes reflect a broader ambition: to ensure that Luxembourg remains a forward-looking, credible and competitive fund centre in Europe. Throughout this period, ALFI's focus remained clear: making sure new regulations work on the ground for fund managers, without compromising the credibility of the Luxembourg market.
COMMUNICATION
Over the past year, ALFI adopted a more proactive and structured approach to media engagement, strengthening its visibility and working more closely with journalists.
This was supported by targeted press outreach around flagship events, increased interview opportunities, and stronger relationships with local and international media. As a result, ALFI has become a more established and consistent voice, with a regular presence in discussions that matter to the industry.
ALFI uses a wide mix of channels to keep its members, industry professionals, and the wider public informed about what’s happening in Luxembourg’s fund sector. From reports and videos to visuals and campaigns, our content comes in many forms — always with one clear goal in mind: supporting the industry’s push to make Luxembourg the world’s go-to hub for investment funds.
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IT PROJECTS
In 2025, ALFI advanced its digital transformation through targeted IT initiatives that strengthened infrastructure, improved member services, and tested new technologies. Key projects included the redesign of the Members Collaboration Hub, the development of a financial chatbot, and the migration to a new data centre environment. At the same time, ALFI introduced new tools to improve communication, security, and user management, and launched strategic projects such as funds data collection and the exploration of emerging AI capabilities.
