Singapore home to more than half of Asia’s family offices, says report

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SINGAPORE – More than half of the family offices in Asia are estimated to be located in Singapore, said KPMG Private Enterprise and family office consultancy Agreus in a report.

Some 9 per cent of the world’s family offices are located in Asia, with 59 per cent of these in Singapore, according to the 2023 Global Family Office Compensation Benchmark Report.

The report estimated that there are about 20,000 family offices globally. It noted that family offices have become accustomed to operating in times of uncertainty, and are quite uniform in their approach.

In the post-pandemic era, they have begun to review the affairs of the families they serve and put structures and relevant planning in place to protect wealth amid potential legislative changes and reputation management.

Family office chief executives in Asia have a wider range of take-home salary, earning between $158,001 and $500,000.

In the Americas, family office CEOs take home a salary ranging between US$198,001 (S$267,800) and US$264,000.

In Europe, the range is €198,001 (S$292,000) to €264,000.

Most family offices in Asia have been in operation for 10 years or less, with 23 per cent in operation for two years or less. About 39 per cent have operated for more than 10 years.

In comparison, family offices that have operated for more than 10 years account for 60 per cent in the Americas and 53 per cent in Europe.

Asian family offices mostly manage wealth for up to three generations, with 27 per cent for three generations, 38 per cent for two generations and 32 per cent for one generation.

In the Americas, 29 per cent of family offices manage wealth for three generations, 37 per cent for two generations and 23 per cent for one generation.

In Europe, three-quarters of family offices manage wealth for up to two generations, with 38 per cent for two generations and 37 per cent for one generation.

Twenty-four per cent of Asian family offices have assets under management (AUM) of about $500 million to about $1 billion, or between US$368.72 million and US$737.45 million, representing the largest AUM bracket for the region.

The other brackets – of AUM at $1.1 billion to $2 billion, $251 million to $500 million, and below $250 million – each make up 20 per cent of Asian family offices.

In the Americas, 26 per cent of family offices have AUM of below US$250 million, 21 per cent between US$251 million and US$500 million, and 17 per cent between US$500 million and US$1 billion.

But the Americas also have the largest proportion of family offices with AUM of more than US$5 billion, at 9 per cent. This is compared with 5 per cent in Europe and 4 per in Asia.

In Europe, 26 per cent of family offices have AUM of below US$250 million, 23 per cent have AUM of between US$251 million and US$500 million, and 20 per cent have AUM of between US$500 million and US$1 billion.

The report expects 2023 to offer a glimmer of certainty due to the knowledge that a recession is likely. Family offices can plan for the outcome and invest with the aim of considering every downfall as an opportunity.

In particular, private equity will be a “particularly interesting watch” after a decline during the Covid-19 pandemic.

PHOTO: LIANHE ZAOBAO

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Edmund Shing, PhD

Global Chief Investment Officer
BNP Paribas Wealth Management

Edmund has over 29 years of experience in financial markets in a wide variety of positions, ranging from proprietary trading to portfolio manager in a number of financial institutions in London and Paris.  He previously held the role of Global Head of Equity and Derivative Strategy at BNP Paribas in London from 2015 to 2020, and has been Chief Investment Officer at BNP Paribas Wealth Management since November 2020.

Edmund is responsible for piloting our investment strategy and will continues to rollout out recommendations and themes with actionable advice that brings our expertise to our clients and support to our client-facing teams.  In this time of change, his expertise in following and anticipating markets is a true value added for both our customers and those at Wealth Management who serve them.

Edmund has a PhD in Cognitive and Computing Science from the University of Birmingham in the United Kingdom, and has done advanced studies in Knowledge-Based Systems and in Experimental Psychology.  He is an EFFAS-certified financial analyst. He has also authored the book “The Idle Investor” published by Harriman House in 2015, proposing 3 simple investment strategies that take only a few minutes to execute per month.

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