Singapore's regulator responds to questions in Parliament, saying total assets under management from high-net-worth individuals only made up about a fifth of the total increase between 2017 and 2021.
The issue of assets from abroad has prompted significant scrutiny in the city-state this year, including in Parliament, although the interesting thing is how much the current government tallies with previous finews.asia commentary on the subject in late March.
To wit, the renewed questions were about the level and specific sources of the assets and they were made earlier this week by two members of the government that were then answered by MAS board member Alvin Tan, who is also the Minister of State for Trade and Industry as well as the Minister of State for Culture, Community and Youth.
He indicated that the level of assets under management held by foreign non-retail clients rose by about S$470 billion ($350 billion) between 2017 and 2021 and that the increase corresponded to about 20 percent, or one-fifth, of the total gain in AuM Singapore experienced in that period.
Broadly Similar
He defined non-retail investors as including family offices, clients of external asset managers, private trusts, and high-net-worth individuals.
Tan also maintained that the growth in assets for such so-called «high-end» individuals was broadly similar to the development in overall AuM, indicating there was a much broader pickup of funds flowing into Singapore finance that was not specific to the high-net-worth.
«In short, the bulk of the increase in AUM in Singapore is attributable to institutional investors. Non-retail individual clients account for a small proportion, and family offices even less,» Tan said.
Family Offices
Tan further indicated that there was no specific breakdown for single-family offices in MAS data but that ones that had applied for and been given tax incentives were about $67 billion, less than 2 percent of the $4 trillion in AuM managed in Singapore in 2021.
He indicated that the MAS does not compile statistics of inflows according to country although it did have breakdowns by region, a practice common in other jurisdictions such as London, Hong Kong, and Switzerland.
According to him, the main increase in high-net-worth inflows was from Asia Pacific, which was to be expected, and it accounted for just over half of all AuM, with it being followed by Europe and the Americas.
No Local Impact
Tan also indicated that the funds managed out of Singapore are invested in assets outside the city-state and have little to no impact on the local currency.
«We have not seen unusual surges of capital into the Singapore dollar that have required a pronounced response on MAS’ part, and certainly not from family offices which, to reiterate, would not form a significant portion of the total flow of funds for management out of Singapore» Tan maintained.
The same was true for inflation, which was not impacted by foreign fund inflows into Singapore - or family offices. Foreign funds did flow into property, he indicated, but purchases by foreigners remained at a relatively low 4 percent, he indicated.
«...family offices themselves have had virtually no impact on our private housing market as there was no residential property transaction attributable to family offices over the last six years,» Tan said.
