Eighty-one percent of senior U.S. money management executives surveyed by KPMG saw their firms' revenue increase in 2012, up from 60% a year earlier.
Also, 84% of the executives at firms managing mutual funds, private equity funds, hedge funds, trusts and managed funds expect revenues will rise over the next year, compared with 69% 12 months earlier, according to KPMG's 2013 Investment Management Business Outlook, released Tuesday.
Among those surveyed, 57% said the U.S. was the most promising region for asset growth in 2013 and early 2014, followed by Asia/Pacific at 28%.
More than half of executives — 54% — said they expect to be involved in some M&A activity this year; of that, 44 percentage points said they would be buyers and 10, sellers. However, only 11% of all surveyed said that, from a management perspective, they would spend a lot of time and effort on M&A.
More than half of executives — 57% — said political and regulatory uncertainty remains the biggest threat to their business models, although 38% said they were “very prepared” to manage the changes brought on by new regulations, up from just 28% in last year's survey.
In addition, 24% of executives were concerned about losing share to lower cost competitors, and 18% were concerned about competition for invested capital, said Jim Suglia, KPMG national advisory leader, investment management in an interview.
Staff increases in the past year were reported by 46% of those surveyed, while 48% expect to hire more people over the next year.
Geographic expansion, at 45%, was identified as the top area for increased spending by managers in the coming year, followed by information technology, at 39%. Also, nearly 40% said their company has “high analytics literacy,” up from 27% last year, and 23% said their company is “rapidly” moving toward becoming an enterprise with high analytical literacy.
KPMG conducted the online survey of 104 senior U.S. money management executives in February.
