Assets under management of managers registered in Singapore, one of Asia's top financial centers, fell by 10% in 2022 to S$4.9 trillion ($3.65 trillion) as of Dec. 31, according to the annual asset management survey report released by the Monetary Authority of Singapore on Nov. 2.
Net AUM inflows fell to S$435 billion in 2022 from S$448 billion the previous year, and traditional assets under management fell by 20%, while alternatives fell by 10%.
Comparatively, total AUM rose 16% in 2021, with traditional assets run by Singapore-registered managers growing by 13% and alternatives growing by 30%.
Among alternative asset classes, real estate AUM had the largest fall in 2022, declining 36% to S$174 billion, while real investment trust assets fell 16% to S$120 billion.
Private equity and venture capital AUM grew, rising 0.3% to S$587 billion, as did hedge fund AUM, which rose 1% to S$227 billion.
The proportion of assets that were given an environmental, social and governance overlay by fund managers fell in 2022 to account for 55% of total AUM, down from 58% the previous year. However, the number of Singapore-registered asset managers that offer ESG strategies rose marginally to 281 from 279.
The 2022 decline marks the first time assets managed by Singapore-registered firms has fallen since 2011, when AUM dipped 1.2% to S$1.34 trillion. A more dramatic decline occurred during the global financial crisis in 2008 when AUM in Singapore fell 26% to S$864 billion.
The number of registered and licensed fund management companies continued to rise, as 144 new firms emerged in Singapore in 2022. In 2021, 146 fund management companies were newly registered and licensed in Singapore.
"Looking ahead, AUM growth in 2023 is expected to remain cautious as headwinds arising from geopolitical tensions and conflicts, market uncertainties and supply chain disruptions continue to weigh down on valuations and investor sentiments," the report said.
"Interest from global asset managers and sophisticated asset owners seeking to set up an office in Singapore remains strong, given the asset management ecosystem. MAS will continue to intermediate international capital flows to support Asia's growth and net-zero transitional financing needs," it said.
Globally, the asset management industry fared poorly in 2022. Assets under management at the 500 largest money managers dropped 13.7% during the year, according to research by the Thinking Ahead Institute and Pensions & Investments.
Total AUM in Hong Kong, another of Asia's top financial hubs, fell 14% in 2022 to HK$30.54 trillion ($3.92 trillion), according to the Hong Kong Securities and Future Commission.