The competition to attract family offices remains fierce among Hong Kong, Singapore, and Switzerland, according to data shared at the Hong Kong Investment Funds Association annual conference.
The South China Morning Post reports that Hong Kong has outpaced Singapore in attracting single-family offices, thanks to tax incentives and an investment-linked migration program. As of the end of 2023, Hong Kong boasts over 2,700 single-family offices compared to Singapore’s 1,400, based on data from the Monetary Authority of Singapore.
In 2022, Hong Kong aimed to attract 200 family offices by 2025. So far, 64 have committed, with another 130 expressing intentions to set up there, according to InvestHK.
Deputy Financial Secretary Michael Wong Wai-lun noted a 24% growth in family offices, hedge fund managers, and private equity fund managers in Hong Kong over the past three years. He highlighted the figure of 2,700 single-family offices now operating in the region.
Contrasting Asia’s positive outlook, UBS chief executive Sergio Ermotti warned that Hong Kong, Singapore, and the US are fiercely competing in the offshore wealth management space.
Hong Kong has also seen a 2% increase in bank deposits in the first four months of 2024 compared to last year. Inflows to local funds have risen, and the HK Monetary Authority aims to enhance the Wealth Management Connect to attract funds from mainland Chinese households.
China Connection
A new report by the HK Investment Funds Association (HKIFA) and KPMG, released at the annual conference, highlights the benefits of Hong Kong’s links to mainland China.
The report, “Vision 2030: The Future of Hong Kong’s Fund Management Industry,” is based on interviews with senior industry executives and a survey of HKIFA members. It emphasizes that the growing number of high-net-worth individuals and the expanding middle class in mainland China will continue to drive demand for investment products. Hong Kong’s expertise in asset management and innovative investment products positions it well to meet this demand.
Elisa Ng, chairman of HKIFA, noted that while mainland China remains a significant market, there are also emerging opportunities across the Asia Pacific region, driven by a growing middle class and sophisticated investors. Additionally, the region’s aging population will require new retirement solutions.
Ng stressed that Hong Kong must maintain its top-tier regulatory regime and tax incentives to retain its status as Asia’s leading asset management hub and preferred location for asset management businesses.
