Singapore’s assets under management increased at a slower pace of 5.4 percent year-on-year in 2018, with growth driven by inflows and valuation gains across private market asset classes.

Despite a challenging year in the global financial markets, Singapore’s assets under management (AUM) increased by 5.4 percent to S$3.44 trillion in 2018, according to an annual poll by the Monetary Authority of Singapore (MAS). The year before, Singapore’s AUM had surged almost 19 percent to S$3.26 trillion. 

«Singapore continues to serve as the Global-Asia gateway for asset managers and investors to tap the region’s growth opportunities, with 75 percent of AUM sourced from outside of Singapore in 2018. 67 percent of total AUM was invested in the Asia Pacific, of which more than a third of Asia Pacific AUM were investments into ASEAN countries,» MAS said in its survey report.

Uneven Growth

The survey found that growth was uneven across the traditional and alternative asset management sectors. Last year's growth was mostly due to a 15 percent surge in alternative assets to S$646 billion, which was supported by strong inflows and continued valuation gains across private market asset classes including private equity (PE) and venture capital (VC).

Inflows were strong in traditional sector strategies managed or advised out of Singapore, but these were more than offset by weaker valuations across major asset markets, in line with global trends. As a result, traditional AUM was sluggish and shrank 7 percent in 2018.

Alternatives See Strong Growth

However, the alternatives sector continued to register robust growth, expanding by 15 percent to S$646 billion last year. In particular, PE, VC and real estate saw strong inflows and continued valuation gains as investors increased their exposures to private assets, to enhance returns and diversify portfolios.

«Singapore, as a leading private markets hub, is an attractive location for investment managers and an increasing number of global public investors, including sovereign wealth funds and pension funds,» MAS added in its survey report.

Annual Survey

MAS conducts an annual study of the Singapore asset management industry, surveying financial institutions including banks, finance, and treasury centers, capital markets services licensees including real estate investment trust (Reit) managers, financial advisers, and insurance firms.

More than 800 respondents participated in the latest survey, which excludes direct investments by government-related entities.