Last year’s growth was mostly driven by a growth in the riskier alternative assets market, which recorded a 29% rise in assets under management to S$410bn, compared to traditional asset managers which reported an increase of just 4%.
The Monetary Authority of Singapore (MAS) said it puts the more muted performance down to returns from basic investments proving disappointing, pushing more investors into alternative bets.
“As public market returns disappoint, more investors are seeking excess returns from illiquidity and credit risk premiums in private markets. This has caused managers to search for new sources of value to deploy capital.”
“These trends illustrate the crossroads facing the asset management industry: Interest rates, which have been low for several years, look likely to remain lower for longer,” the Monetary Authority of Singapore (MAS) said in its annual survey of asset managers.
Despite the decline, Singapore’s performance was in line with the 10% growth in Asia’s asset-management industry in 2015, figures from Boston Consulting Group reported earlier this year.
Within the alternative sector, private equity AUM rose 47% to S$136bn, while AUM of hedge fund managers grew by 11% to S$119bn, the MAS said.
