Singapore’s asset management sector leaps to record as funds grow

By on October 21, 2022 0

SINGAPORE, Oct 21 (Reuters) – Singapore’s asset management industry reached a record size last year, outpacing global growth in the sector, as the city-state benefited from an increase in global fund activity and regional.

The Monetary Authority of Singapore (MAS) said total assets under management in Singapore increased by 16% in 2021 to 5.4 trillion Singapore dollars ($3.8 trillion), compared to a global increase of 12% to $112 trillion last year.

Hampered by tough measures to fight COVID-19 in China and Hong Kong, entrepreneurs and investors are setting up shop or expanding their investments in Singapore.

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According to a survey conducted by the MAS, asset growth was fueled by a 30% year-on-year jump in the alternatives sector, which includes private equity, venture capital, hedge funds, real estate and real estate investment trusts.

“Within the alternative sector, growth in private equity and venture capital assets under management was robust at 42% and 48% respectively,” MAS said in its annual report on the sector.

Private equity and venture capital managers reported dry powder, or capital committed but not drawn, totaling S$90 billion and S$5 billion respectively, according to the survey.

There has been a large influx of family offices and funds into Singapore, particularly from China, and funds and tycoons have snapped up high-end properties and backed start-ups based in the city and the region.

MAS said the number of fund management companies licensed and registered in Singapore increased by 15% to 1,108 last December.

The funds have also benefited from generous tax breaks and incentives offered by Singapore as it seeks to reestablish its reputation as one of Asia’s leading financial services hubs.

The launch of a new corporate structure called Open-ended Companies (VCCs) in Singapore in 2020 attracted a wide range of asset managers, including family offices, hedge funds and private equity.

The MAS survey said more than 660 VCCs had been created or redomiciled in Singapore as of October 14 this year, up from more than 400 the previous year.

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Reporting by Yantoultra Ngui; Editing by Anshuman Daga, Robert Birsel

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