Chances ahead in asset guidance: PwC Taiwan

• By Crystal Hsu / Staff reporter

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The Asia-Pacific region’s expanding asset management market offers Taiwan’s financial firms an opportunity to attract more wealthy clients and regional capital, but stronger investment expertise and service capabilities would be essential to compete, PricewaterhouseCoopers (PwC) Taiwan said in a report yesterday.

Assets under management in the region are projected to rise to US$34.5 trillion by 2030 from US$23.2 trillion in 2024, while industry revenue is expected to increase by US$47 billion, the report said.

Total client assets are forecast to reach US$154.3 trillion by 2030, up from US$107.2 trillion in 2024, and assets of high-net-worth people and mass-affluent clients are projected to reach US$52.4 trillion and US$70.1 trillion respectively, the report said.

Buildings in the Kaohsiung Asset Management Special Zone is pictured on Oct. 31 last year.

Photo: Ge You-hao, Taipei Times

As Taiwan aims to capitalize on the opportunity by developing its capital markets and financial services into a regional wealth management hub, the government’s Asian asset management center initiative has helped increase assets under management across Taiwan’s financial industry by NT$15.24 trillion to NT$47.8 trillion (US$470.1 billion to US$1.474 trillion), exceeding its original four-year growth target of NT$14 trillion ahead of schedule, PwC Taiwan said.

As of the end of August, 26 banks had been approved to provide wealth management services to high-net-worth clients, managing NT$3.11 trillion in assets, the Financial Supervisory Commission (FSC) said.

The asset management special zone in Kaohsiung, which allows financial institutions to test new services, had attracted 58 institutions by the end of June. Participating banks served 6,214 wealthy clients and managed NT$728.1 billion, with pilot programs covering family offices and cross-border services, the commission’s data showed.

Taiwan’s asset management market is forecast to grow at a compound annual rate of 15.9 percent through 2030, said Jassie Chen (陳麗媛), cohead of PwC Taiwan’s Asian asset management center office.

The FSC has opened the door to private equity and private credit, and is considering easing restrictions on some offshore funds. It is also planning to overhaul real-estate investment trusts, shifting toward a fund-based structure and allowing for potential investments in infrastructure, data centers, renewable energy and healthcare facilities.

The government is also promoting exchange-traded funds and Taiwan Individual Savings Accounts to deepen capital market participation.

However, a larger market will not guarantee regional competitiveness, said Kuo Po-ju (郭柏如), financial services operations leader at PwC Taiwan.

“Market growth does not mean all players will benefit equally,” Kuo said.

Firms must improve their investment expertise, technology, talent and compliance capabilities to compete on service quality rather than price, she said.