According to the 2020 Singapore Asset Management survey published by the Montary Authority of Singapore, at the end of 2020, total assets managed by Singapore based asset managers grew 17% to reach $4.7 trillion, up from $4.0 trillion in 2019. Over the last five years, the industry’s AUM expanded at a 13% compound annual growth rate (CAGR).
Managers across the traditional and alternative sectors, as well as leading global public owners, continued to anchor their investment teams in Singapore to tap the region’s growth opportunities and to domicile their investment funds in Singapore using the new Variable Capital Company (VCC) framework.
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Singapore’s 2020 AUM growth was driven by both net inflows of funds and valuation gains. The traditional sector saw a 15% growth in 2020. the alternatives sector was a key driver of AUM growth at 31% year-on-year to reach $947 billion. Private equity (PE) and venture capital (VC) AUM increased by 54% to $391 billion, compared to 16% growth in 2019, as investors continued to increase exposure to these asset classes in their search for yield.
In 2020, there was a net increase of 67 registered and licensed asset managers bringing the total to 962. Singapore continues to maintain a high level of discretionary AUM, which made up more than half of total AUM at 51% in 2020.
In 2020, 78% of total AUM was sourced from outside Singapore, of which 34% was sourced from the Asia Pacific excluding Singapore, 17% from North America and 16% from Europe. The proportion of AUM from outside Singapore is a slight increase from 76% in 2019,
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Green and sustainable finance continues to be a priority for Singapore. MAS is building a vibrant financial ecosystem to support Asia’s transition to a low-carbon future, which includes building knowledge and capabilities in sustainable finance. A growing number of financial institutions (FIs) and service providers have set up sustainability hubs in Singapore to accelerate their sustainable finance agenda in Asia-Pacific.
As at mid-October 2021, more than 400 VCCs have been incorporated or re-domiciled by close to 300 Singaporebased global and regional asset managers.
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Singapore is home to more than 1,000 FinTechs, where over 80% of them are in the business-to-business (B2B) space, including the investment and wealth management sector. Over 4 innovation labs by FIs based in Singapore have been able to tap onto the Singapore FinTech ecosystem to produce many market leading innovations in banking, wealth management, investment and insurance sectors.
