Asset managers in Europe will be competing for an extra $8 trillion (€5.8 trillion) in assets under management (AuM) up until the end of the decade, it is predicted.
Europe’s 2012 AuM figure of $19.7 trillion will rise to $27.9 trillion in 2020, PwC, the business consultancy, predicts.
Meanwhile, key distribution centres will emerge in Asia and Latin America, helping to drive the global AuM figure from $63.9 trillion to $101.7 trillion.
At the global level, the three key drivers will be: new sovereign wealth funds with diverse investment agendas; the spread of defined contribution pension systems; and the increase of mass affluent and high-net-worth individuals in South America, Asia, Africa and the Middle East.
Assets under management in South America, Asia, Africa and Middle East economies are set to grow faster than in the developed world in the years leading up to 2020, creating new pools of assets, PwC says in its report, Asset Management 2020: A brave new world, though the majority of assets will still be concentrated in the US and Europe.
In 2012, the asset management industry managed 36.5% of assets held by pension funds, sovereign wealth funds, insurance companies, mass affluent and high-net-worth-individuals. If the industry is successful in penetrating these clients’ assets further, PwC believes the industry would be able to increase its share of managed assets by 10% to a level of 46.5%, which would in turn represent $130 trillion in global AuM.
It is a period when the asset management industry could move to centre stage of financial services, a sector dominated by banks and insurers, says PwC.
Rob Mellor, asset management 2020 leader at PwC, says: “Asset managers must deliver the clear message that they deliver a positive social impact to investors and policymakers. The efforts required to satisfy investors and policymakers cannot be left to others.”
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