The more “subdued” outlook comes amid increased geopolitical tensions, which after the economic environment was the second-biggest concern among the firms surveyed.
Fund inflows to Hong Kong were HK$121 billion in 2022, a decline of almost 80% from the previous year. The total assets of Hong Kong’s private banking and private wealth management business were HK$8.97 trillion at the end of 2022, down 15% from the previous year as markets declined.
Another “significant trend” is multi-shoring — opening accounts in two or more jurisdictions to spread risk and diversify investment, according to the PWMA. Rival Singapore has been one of the winners, with the share of clients with accounts also booked in the city state rising to 73% from 64% last year.
“While this trend may be considered concerning on the face of it, our discussions with the industry on the results indicate that the impact is less significant,” the association said. “Many noted that what is critical is that the relationship and assets are still being managed from Hong Kong with the opening of accounts being part of a risk diversification strategy of using dual booking centres across Hong Kong, Singapore and other locations.”
See also: How AI and innovation are redefining wealth management for UHNWIs
The report is based on a survey of PWMA member institutions and their clients. Almost 80% of member firms, 33 out of 42, responded to the PWMA survey, as well as more than 200 clients, according to the group.
