The family office sector in Singapore has grown by more than a quarter (27%) in the last 12 months, according to the deputy prime minister.
But despite Singapore’s continued success in attracting the ultra-wealthy to its shores, there are challenges to setting up a family office in the country as well as the threat of competition from other jurisdictions in the region.
In response to a parliamentary question, Lawrence Wong stated that there were around 1,400 family offices by the end of 2023, thanks to the launch of around 300 new businesses.
The growth comes despite greater regulatory scrutiny of the sector in the wake of the billion-dollar money laundering scandal that involved several family offices.
In addition, family offices also face challenges due to the limited knowledge of sponsors in Singapore, according to a report by Simon & Kucher.
‘The APAC Family Office Study: Challenges and perspectives across the ecosystem’ found that family offices also face challenges around staffing and operational infrastructure.
"New family office sponsors lack awareness of the operational scope and complexity of setting up a family office,” the report stated. “They are also not familiar with the legal and regulatory requirements which vary across jurisdictions.”
Consequently, any firm looking to open a family office in Singapore should “plan for success on day two and not on day one”.
Meanwhile, InvestHK, the wealth management association in Hong Kong, has boasted that the number of family offices on the island could soon surpass that of Singapore after 382 mainland Chinese and overseas firms set up in Hong Kong in 2023.
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