Investment fund services

Luxembourg is a leading centre for the issuance and distribution of investment funds with more than EUR 2 trillion of assets under custody and now LuxCSD provides a key element to re-enforce Luxembourg's fund processing infrastructure.

LuxCSD provides services for the routing of investment fund orders and acts as a centralised facility for the issuance and settlement and custody of investment funds.

Order routing

LuxCSD offers order routing services for investment fund shares through Vestima, an automated order routing service for the investment funds industry. Vestima provides a single entry and reception point for domestic, international and offshore funds, allowing orders and order confirmations to be submitted, validated and routed to the relevant recipient.

Central settlement and custody services

LuxCSD provides a post-trade infrastructure for investment funds settlement processing. It offers standard settlement services based on the synchronous exchange of cash in EUR central bank money and LuxCSD-eligible investment fund shares between distributors and the fund settlement agent within LuxCSD. These services are fully integrated with the custody and settlement services on the Creation platform.

The use of a Fund Issuance Account (FIA) by a fund settlement agent in LuxCSD, together with optimised reconciliation processes with LuxCSD transfer agents, contributes to the settlement of orders in alignment with the relevant investment fund register.

Distributors can use an existing LuxCSD account to hold LuxCSD qualified investment fund shares along with other securities. In addition, they can open a designated LuxCSD account to hold such shares exclusively.

For fund providers or their agents (Transfer Agents), LuxCSD is minimising the impact of T2S by providing them with access to CSD settlement in EUR central bank money through proven fund issuance mechanisms.

Position holding in the register

LuxCSD acts as custodian for its customers and holds as nominee (on behalf of its customers) the total of its customer's positions in an omnibus account, recorded in the investment fund register, under the name of LuxCSD.

LuxCSD is the registered shareholder in the fund, receiving the shareholder information from the investment fund. LuxCSD keeps and maintains the individual position of LuxCSD customers in its electronic records and distributes shareholder information accordingly.