Asset and Wealth Management
– Impressive Performance
The asset management industry continued
to expand as fund managers added more functions such as regional
trading desks and centralised their back offices in Singapore.
Total assets managed by Singapore-based financial institutions
grew 35.3% in 2003 to S$465.2 billion, comprising S$254.6 billion
of discretionary assets and S$210.6 billion of non-discretionary
assets (See Chart 15). The increase in assets under management
reflected renewed foreign investor interest in Asia, the centralisation
of the management of regional portfolios in Singapore, and market
appreciation.
There has also been an increasing
interest in alternative investments managed from Singapore,
including Real Estate Investment Trusts (REITs), private equity
and venture capital and hedge funds. In 2003, listed REITs announced
better-than-expected results and MAS continued to work on a
more flexible regulatory environment for the management of such
investments. Hedge funds also performed well, reflecting the
increased sophistication of investors. The number of hedge fund
managers grew 34% from 41 at end 2003 to 55 at end May 2004.
Alternative investment managers were attracted to Singapore’s
low business cost, conducive tax framework, transparent and
sound supervisory framework, and investment-friendly environment.
Private banking also saw strong growth last year. Anecdotally,
private banks have indicated to MAS continued strong performance
both in terms of asset gathering as well as profits and revenues.
Asia is currently the fastest growing market in the world for
private wealth services. Demand for advice on estate and succession
planning has been on an increasing trend. Employment in the
industry has been strong with the creation of new jobs in relationship
management, product specialisation as well as mid-office positions.
Enhancing Risk-focused Supervisory Approach
Box 1 – Fostering a Sound and Progressive
Financial Services Sector
