Press release

Profit and loss account of credit institutions as at 31 March 2021

Press release 21/15

Profit before provisions of the Luxembourg banking sector1 amounts to EUR 1,321.1 million for the first quarter of 2021, i.e. an increase of 13.7% compared to the same period of the previous year.

In the first quarter of 2021, net interest income recorded a decrease by 18.6% compared to the same period of 2020. The decrease of this item was shared by 75% of the credit institutions. This decline was mainly due to a reduction of margins in interbank lending and in loans to non-financial corporations and also to the lower dollar interest rate.

Net fee and commission income, which mainly resulted from asset management activities on behalf of private and institutional customers, including the financial services provided to investment funds, grew by 5.8%. This growth was shared by 62% of the Luxembourg banks. The commissions on custody of assets were up following the positive development of stock exchange prices and financial asset valuations.

The important rise (+284.4%) in other net income stems from the divestment of activities carried out by a bank of the financial centre.

General expenses (+4.6%) continued their upward trend in over half of the banks.

Taken together, the above-mentioned developments led to an increase of profit before provisions and taxes of 13.7%.

1 The scope of the data of the Luxembourg banking sector covers now banks active during the reference period, except for their foreign branches and their subsidiaries, in order to better represent the level of national activity. The previous publications only excluded the subsidiaries from the scope.