Asia Pacific family offices are shifting their focus towards wealth and investment management as they expect positive returns on their portfolios in the next 12 months, according to Citi Private Bank’s 2023 Family Office Survey.

According to the study, a majority (49%) of the region’s respondents anticipate returns of around 10% to 15% in their portfolios. This is amid increased allocations to cash, which is reported most significantly (54%) in Asia Pacific compared to other regions as the family offices navigated market uncertainty.

With plans to reposition their portfolios in the next 12 months, family offices in the region were most bullish on global developed investment grade fixed income (43%), private credit (33%), private equity direct investments (29%) and emerging market equities (29%).

Meanwhile, the preferred sectors for public markets were technology (76%), healthcare (61%) and financials (37%).

“With respondents in this region holding a sizable proportion of investible cash and with their bullish outlook on investment grade fixed income, private markets and emerging market equities, we would expect to see investment activity in the region pick up,” says Citi Private Bank South Asia head of the global family office group.

In addressing family concerns, preserving the value of assets was the most important for the majority of the respondents at 74% — the highest relative to other regions. This was followed by preparing the next generation to be responsible wealth owners (59%).

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The study also points to the increasing professionalisation of family offices. In Asia Pacific, 63% of the respondents had already separated their entities from their family business, while 13% were underway.

Compared to other regions, the appetite for sustainable investments in Asia Pacific was higher than in any other regions. Only 6% of respondents in the region lacked any exposure to sustainable investing, which is the lowest percentage relative to other regions.

The family offices in the region are also working hard to reflect the giving philosophy and priorities of the rising generation — 38% of respondents are planning philanthropic leadership succession while 36% are looking at enhancing the strategic development of philanthropy.

Participants in Asia Pacific made up 21% of total respondents, the highest proportion and number from the region since the inception of the annual survey.

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