Asia bucks trend to see AUM increase in 2018

Asia was the one bright spot in terms of wealth manager assets under management last year, being the only region where assets increased rather than declined.

According to GlobalData analysis, allocations by private wealth mangers to Asia during the year meant Asian assets under management rose by 6.7 per cent in 2018.

However, it was not all good news as profits for Asian wealth managers fell for the second year in the row as competitive pressure affected margins.

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Andrew Haslip, head of financial services content for Asia Pacific at GlobalData, said: “Every major international wealth manager looking to grow client AUM is looking towards Asia and with good reason. There is new wealth that cries out for professional management but wealth managers looking for volume in Asia will have to accept lower short-term profits in order to compete.”

Overall, assets under management among the 40 private wealth managers globally declined by one per cent to $12.1 billion during the year. Negativity was particularly evident at the largest banks such as UBS and Bank of America Merrill Lynch and in firms based in Europe.

Haslip said this was a result of last year’s volatile financial markets and less favourable macroeconomic conditions.

“This weakness in the market was centred in Europe once again, with both the key Swiss market and players from the rest of the continent seeing a decline in portfolio size. But considering the late stage of the economic cycle and the rising trade tensions, it is likely that 2017 was the recent peak in the market for global private wealth management. Macroeconomic conditions are less favourable for wealth generation over the near term and that is certainly reflected in the decline in inflows that we have seen as well," he commented.

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