Asian institutional AUM drops for first time in decade

Written by Dan McGrath

21/11/2023

Assets managed by Asian institutions shrunk for the first time in a decade in 2023, Coalition Greenwich has found.

The firm reported in its 2023 Asian investment management study that since 2012, institutions across the Asia-Pacific region managed slightly more than $8trn (£6.38trn) in AUM, growing every year to 2022 to $17.4trn (£13.9trn). However, this dropped in 2023 to approximately $17trn (£16.57trn).

Coalition Greenwich described this drop in institutional AUM as "bad news for asset manger competing for mandates in Asia", and the results of the firm’s study show that "demand for new manager is expected to decline" as many institutions take on a cautious stance and hold back on hiring amid the volatility.

Despite the slowdown in hiring, the firm said that several important trends still point in a positive direction for the industry, including the number of assets available to external managers increasing from $3.8trn (£3trn) to $4trn (£3.2trn), extending the growth in outsourced assets intact to 10 years.

Furthermore, Coalition Greenwich has said that amid the challenging market conditions, Asian asset owners sought out the stability of large, established and reliable investment managers like Allianz Global Investors and PIMCO.

Senior relationship manager at Coalition Greenwich, Arifur Rahman, said "Those outsourced assets are coming from a broader group of institutions. The result is a more open and diverse marketplace for asset managers competing for mandates and assets."

Relationship director at Coalition Greenwich, Parijat Banerjee, added: "More than two-thirds of Asian asset owners expecting to adjust strategic asset allocations in the next three years are planning to boost allocations to private debt."

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