Hong Kong’s private wealth assets under management could nearly double to $2.3 trillion by 2030, as China’s growing affluence increases investment through the city’s cross-border financial infrastructure, even with China's strict controls on capital flows, according to Bloomberg Intelligence.
Hong Kong’s family office lead over Singapore is set to widen as it overtakes Switzerland as the world’s top cross-border wealth center as early as next year in 2025, the report said. Singapore is in third spot, with the US in fourth, the UK in fifth and Jersey, Guernsey and the Isle of Man in sixth place,
Banks such as HSBC, Standard Chartered, BOCHK and DBS may win a bigger share of net new money in Asia than global peers like UBS, the report said.
Predictions that Hong Kong – recovering from the pandemic lockdowns and political changes – could overtake Switzerland as the world’s largest offshore/cross-border wealth hub are not new. In 2022, Boston Consulting Group made such a forecast.
The report, called Hong Kong’s Wealth Management Outlook, comes at a time when, as reported here, Hong Kong has been pushing to raise its profile as a centre for family offices and private market investments, among others. This puts makes it a competitor with Dubai, Singapore, Switzerland and London.
In other details of the Bloomberg Intelligence report, it showed that Chinese demand for higher-yielding offshore investments could rise 16 per cent a year through 2030, with US and Hong Kong interest rates likely to remain higher than in mainland China beyond 2027, as based on market expectations.
The 50-page report said that Hong Kong’s private wealth management industry should benefit from cross-border inflows as well as local households’ rising affluence.
Several milestones are flagged in the report, starting in November this year, in which the report said that monthly data on southbound capital markets/funds activity from the mainland to Hong Kong will show “strong demand for offshore investments”; in the first quarter of 2025, there could be regular “enhancements” to cross-border market access programs; and in January, geopolitical risks for Hong Kong’s financial center status could be put in the spotlight as a new US administration takes office. And in 2025/26, Hong Kong will overtake Switzerland as the world’s largest cross-border wealth hub, according to the report’s estimation.
Effects on banks
Examining how specific banks and other financial institutions will be affected by these trends, the study made the following observations:
“HSBC’s dominance in Hong Kong remains a powerful lever to wealth growth. Hong Kong contributed 54 per cent of the $5.4 billion in group wealth and personal banking’s international revenue in H1 . New customers reached 345,000 in Hong Kong, 77 per cent more than in H1 23. Private banking AuM reached $209 billion in Asia.”
Standard Chartered: The report said the bank could achieve a 12 per cent return on tangible equity guidance for 2026. “The wealth business is a key growth driver and a timely cost refocus critical keeping 2024-26 operating jaws positive,” it said.
The bank’s investment in wealth management helped its AuM reach $294 billion in the second quarter, making it Asia’s third-largest wealth manager. Some $23 billion in net new money year-to-date equates to 16 per cent annualized growth. “The bank’s Asia footprint should help capture cross-border flows in the region and deliver or even exceed its 2026 wealth management growth targets.”
BOC Hong Kong: The report said this bank’s earnings growth could reach double digits in 2024 after finishing the first half of the year with a rise of 18 per cent. BOC Hong Kong is the second-largest bank in the city after HSBC. “Its Greater Bay Area customer base surged 70 per cent last year, with Wealth Connect customers up 80 per cent.” The study estimates that private banking AuM stands at around $50 billion.
DBS: the study said the Singapore-headquartered bank’s fee income could rise through 2025 as it continues to build private banking and family office offerings. DBS’s wealth business had S$396 billion in assets at the end of June this year, producing a 24 per cent rise in fee income.
With 62 per cent of revenue from Singapore, 15 per cent from Hong Kong and 9 per cent from the rest of Greater China, DBS is “well positioned” to capture wealth flows, the report said, although DBS lacks “global connectivity.”
The report also cast its eye over Hong Kong Exchanges and Clearing, AIA, Citic Securities, Sung Hung Kai, and Vanke.