The complex and ever changing regulatory environment represents an additional challenge for financial players, especially when operating at an international level.
The EBA Guidelines on outsourcing arrangements, which were published in November 2019, aim to further harmonise these requirements across countries of the European Union. While a local transposition into the regulatory framework is currently still outstanding, financial institutions in Luxembourg have already initiated alignment projects for their internal outsourcing procedures, also knowing that the key requirements of these guidelines should be considered as good market practices.
For the third time running, we have asked several business leaders from the financial services industry to see what kind of outsourcing strategies they have, or are planning to put in place.
We have put together a concise survey of some 25 questions split into six distinct sections. We have sent the survey to CEOs, CIO, CCOs and COOs of leading financial institutions and service providers in Luxembourg and received well over 80 responses. After a thorough evaluation of the responses, we are sharing today the most significant findings on sourcing strategies in Luxembourg.
Regulated entities in Luxembourg that are already in, or are considering entering into outsourcing arrangements.
The popularity of outsourcing continues to be on the rise within the financial services industry. The evolving regulatory framework does not seem to have a detrimental effect on this trend, even though requirements related to governance and documentation continue to increase. The extent of delegated activities is remarkable, given that 94% of the respondents are already outsourcing some type of activity, Information Technology being the most outsourced activity in Luxembourg. Reliance on cloud-based solutions is also continuing to gain traction, a trend that was already observed in our previous surveys.
Markets and Strategy Financial Services Leader, PwC Luxembourg
Tel: +352 49 48 48 4174
Regulatory & Compliance Advisory Services - Banking - Partner, PwC Luxembourg
Tel: +352 49 48 48 2245
Regulatory & Compliance Advisory Services - Banking - Managing Director, PwC Luxembourg
Tel: +352 49 49 48 4169