Asia is experiencing extraordinary growth in the number of high net worth (HNW) individuals which is leading to a spike in business for wealth, advisory and family office firms.
Rachel Yao, head of Asia trusts and private wealth at Carey Olsen, said that China’s investable assets were at around $40trn (£33.5trn, €39.5trn) at the end of 2021, and Singapore is becoming the jurisdiction of choice for servicing the wealthy.
But high net worth clients’ needs have evolved, she added, as they now require a much more encompassing range of services than before.
“HNWIs understand the urgency and importance of their children’s education and own business succession,” Yao said.
“Their needs have extended from personal needs to family, corporate and social needs so they will have increased requirements for external advisory services and expect to have a one-stop shop experience.
“For wealthy inheritors, we understand that they start with property and insurance, and then gradually expand to family trusts.”
Singapore is becoming very popular especially among newly-rich Chinese HNWs because of its tax incentives and highly regulated market, as well as exemptions available to single family offices.
“Singapore is definitely a rising star in the Asia private wealth market,” Yao said. “It benefits from a central location in Asia, good infrastructure and business connectivity, strong rule of law, sophisticated and highly regulated financial market infrastructure, and first-world standard of education and living.”
To put that into context, the number of family offices established in the Lion City skyrocketed in the last three years, from 27 in 2018 to 453 in 2021, Carey Olsen found.
Yao added: “Even though Singapore has recently tightened its family office rules, I haven’t really seen a lot of impact on any family offices as a result of these additional measures.
“For a lot of our clients, when they set up a family office in Singapore, their aim is to diversify their wealth with onward investment out of this region so, to the extent that they decide to make asset investments, they tend to cast their net quite wide and invest globally.”