Global assets under management are projected to surpass $70.4 trillion by the end of 2013, a full $20 trillion higher than the industry's low point in 2008, according to Cerulli Associates' annual global markets report.
The 12th annual report covers all professionally managed assets, both retail and institutional.
Total assets are projected to reach $89.7 trillion by the end of 2017, with the U.S. making up 41.3% of assets, down from 43.3% at the end of 2012.
However, “one thing we are very sure about is that the U.S. remains the key growth driver,” said Yoon Ng, associate director at Cerulli, in a telephone interview. “It's still growing at a fairly strong rate.”
Asia ex-Japan is expected to have the highest growth rate over the next five years, but Ms. Ng said managers will need to be able to generate stronger bottom-line growth, a continuing concern for managers globally.
Ms. Ng said institutional opportunities will really drive the growth over the next five years. Of countries with more than $500 billion in AUM, the U.K. is expected to have a compound annual growth rate of more than 10% over the next five years for retirement assets. The U.S., Australia, Netherlands and Norway are expected to have moderate 5% to 10% growth while Canada and Japan are estimated at less than 5%.
In countries with less than $500 billion in AUM, Hong Kong, Taiwan, Brazil, Chile, China, France, Italy, Korea and Mexico are projected to have greater than a 10% CAGR.
In countries with $100 billion to $500 million in AUM, Brazil, Chile, China, France, Italy, Korea and Mexico are projected to have greater than a 10% CAGR while Hong Kong and Taiwan are estimated to have similar growth for countries with less than $100 billion in AUM.
While Ms. Ng said Europe, as well as Japan, likely will have the weakest growth projections, 50% of European managers expect revenue in 2013 to grow by 1% to 10% and a fifth of managers expect more than 10% in revenue growth.
“We thought that was quite an aggressive number,” Ms. Ng said. “We expect to see a greater focus … to carve out specific segments like private banks.
At the end of 2012, the U.S. managed $28.9 trillion out of a total $66.7 trillion in assets. Europe managed $23.8 trillion and Japan, $4.2 trillion.