Hong Kong’s Wealth Managers Expect Lower AUM Growth in Five Years

Private wealth managers in Hong Kong see lower growth in assets under management due to challenging external conditions.

Around 15 percent of Hong Kong’s private wealth managers expect to see lower than 5 percent growth in the annual assets under management (AUM) for the next five years. The number is higher than only 8 percent of wealth managers in a survey in 2022.

Meanwhile, around 18 percent of the participants estimate more than 10 percent growth in AUM, according to Hong Kong Private Wealth Management Report 2023. «The challenging external conditions have affected the industry’s outlook,» the report by the Private Wealth Management Association (PWMA) said.

Main Concerns

The macroeconomic environment and market volatility are still the top concerns of the industry. Meanwhile, the geopolitical tensions between the US and China are now ranked second on the list.

The geopolitical tensions are likely to be a longer-term issue for the private wealth management sector and Hong Kong in general. The industry mainly sees the recent US Executive Order that further restricts investment in Chinese technology as a sign that the US-China tensions are unlikely to ease in the near future, the report said.

Sources of Growth

Despite the challenging situation, Hong Kong's private wealth market still expects potential growth from Mainland China, the next generation as well as family offices. Aside from mainland China, the industry seems to shift their focus on developing new sources of wealth, mainly in Southeast Asia and the Middle East.

This 2023 report is based on a survey and interviews by the Private Wealth Management Association (PWMA), under collaboration with KPMG China. The process was conducted between June and August 2023 and involves 80 percent of PWMA member firms and more than 200 clients.