In the 2016 Singapore Asset Management Survey published by the Monetary Authority of Singapore (MAS) on 26 September 2017, it was announced that assets under management (AUM) expanded by 7% to S$2.7 trillion last year. This growth was attributed to sustained net fund inflows and broad-based improvements in market valuations.
Alternative assets continued the trend of faster growth than traditional assets, as alternative AUM grew by 17%, compared to traditional AUM which increased 3%. Alternative assets include private equity, venture capital, hedge funds and real estate.
78% of total AUM was sourced from outside Singapore. Of the total AUM, 55% was sourced from the Asia-Pacific, 19% from North America, 17% from Europe, and 9% from the rest of the world. In terms of investment destinations, the Asia-Pacific region remained a key investment destination for Singapore-based asset managers, accounting for approximately 66% of total AUM.
Within the alternative assets sector, private equity, venture capital and real estate managers contributed to the bulk of the net fund inflows as they deployed capital into new investment opportunities. Private equity, venture capital and real estate AUM recorded robust growth rates at 14%, 32% and 30% respectively.
“AUM in these sectors continued to grow robustly on the back of buoyant deal making as managers deployed funds into investment opportunities,” the MAS indicated in the survey.
In the survey, the MAS reiterated its commitment to building a vibrant venture capital and private equity ecosystem, as part of broader efforts to develop Singapore as a financing hub for growth companies in Singapore and the region. Earlier in February 2017, the MAS published a consultation paper proposing a simplified authorisation process and regulatory framework for managers of venture capital funds (VC managers). Once the proposed new regulatory regime for VC managers is implemented, new VC managers can expect a much simplified and expeditious authorisation process.
Noteworthy also is that there was a net increase of 32 registered and licensed fund managers in Singapore, bringing the total number of registered and licensed fund managers to 660.
While Singapore has established itself as an asset management hub, the Singapore government has plans to further consolidate fund management and fund domiciliation activities in Singapore. In March 2017, the MAS held a public consultation on a proposed corporate vehicle for collective investment schemes, known as the Singapore Variable Capital Company (S-VACC). The MAS targets to implement the framework by end 2018.
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