Hong Kong wealth management assets hit $1trn

23 Jul 18

A more inclusive assessment of Hong Kong’s financial services sector helped push total assets under management at private banking and private wealth management firms to $1trn (£767,730, €859,910) in 2017.

A more inclusive assessment of Hong Kong's financial services sector helped push total assets under management at private banking and private wealth management firms to $1trn (£767,730, €859,910) in 2017.

The data comes from a recently-released annual Securities and Futures Commission (SFC) report on asset and wealth management activities in the special administrative region.

Last year, the SFC report showed wealth management assets were at $670bn.

However, the regulator said in this year’s report that the new survey includes “private banking and private wealth management clients’ accounts generated, managed or served by local relationship managers of licensed corporations and registered institutions”.

Therefore, the survey is much broader than previously, so the 2016 figure cannot be used for comparison.

For the full-year 2017, institutional and corporate investors accounted for 50% of the wealth management business and high net worth represented 46%, the report said.

As for region, 62% of the AUM of the private banking and private wealth management business was invested in Asia Pacific. Within that, about half of assets were invested in mainland China and Hong Kong.

Looking at product type, equities represented 44% of the total AUM for the private banking and private wealth management business in 2017:

Source: SFC. Full year 2017

Asset management growth

Hong Kong’s asset management and fund advisory business grew by 23% to $17.5trn, the report said.

Overseas investors accounted for 66% of the city’s fund management business, reflecting the robust sales and distribution activities in Hong Kong, the report said.

The survey also revealed that China and Hong Kong remained preferred markets for assets managed in Hong Kong. The money allocated to these markets was up 26% to HK$4.2trn.

Among the registered funds under the SFC, public funds accounted for 38%, followed by managed accounts (27%) and private funds (16%). The category of private funds include hedge funds, private equity and venture capital.

Moreover, the number of Hong Kong-domiciled SFC-authorised funds rose 7% to a total of 755 and their net asset value grew 30% to HK$1.24 trn. The local government is planning to revamp the rules for registering locally-domiciled funds to encourage more domestic and global firms to set up Hong Kong-domiciled products.