Deloitte Global report ranks Singapore in second place for competitiveness in international wealth management centre ranking

Singapore, 26 October 2021 – According to the fourth edition of the Deloitte International Wealth Management Centre Ranking (IWMCR), a study that compares wealth management centres around the globe in terms of asset size, competitiveness, and performance, the leading centres of international wealth management did surprisingly well during the COVID-19 pandemic.

At 10.6%, market growth has been the highest seen in the past decade and significantly above that of the last four-year weighted average of 4.8%. Investors tended to relocate their assets to “safe haven” markets with greater political and financial stability as well as better service offerings. Global wealth concentration also had a positive impact for international wealth management markets, as wealthy individuals typically hold a significant proportion of their assets outside their country of residence.

Switzerland still on top, others closely behind

Switzerland is still the leading centre in terms of competitiveness and size. Singapore and Hong Kong are second and third for competitiveness, and the United Kingdom and United States come second in terms of size.

While the top positions remain relatively stable, the US, UK, and Luxembourg have been able to catch up due to their dynamic growth and strong rebound post the initial COVID-19 shock. Switzerland, on the other hand, achieved growth of 7.3%, which is below the weighted average growth rate for the nine centres of 10.6%.

“International wealth management had a very successful year, but Switzerland couldn’t keep up with the overall market development and the gap between Switzerland and the UK and US is shrinking. Swiss wealth managers are the clear worldwide leaders when it comes to competitiveness. Their scale provides a good basis for the much-needed digital push by the industry and the high number of served booking centres will help them to further consolidate their leading position”, explains Patrik Spiller, Wealth Management Industry Lead at Deloitte Switzerland and Europe.

“Another trend that will intensify competition is the consolidation process foreseen for the Swiss wealth management sector. Regulatory pressure and the need to invest in digitalisation mean higher costs, which can be difficult for smaller private banks and independent wealth managers to bear”, explains Jean-François Lagassé, Global Wealth Management Leader and Financial Advisory Partner at Deloitte Switzerland.

Singapore retains position in competitiveness ranking

In terms of competitiveness, the ranking of the three leading centres remains unchanged from 2018: Switzerland, followed by Singapore, and Hong Kong. The race is tight, with factors such as environmental, social, and governance (ESG) investments and political stability becoming more important – and regulation less differentiating.

“Although all international wealth management centres have been affected by an erosion of structural fees and increased costs driven by stricter regulation, Asia’s wealth has continued to grow faster than anywhere else. This increasing wealth in the region is in turn leading to the further development of Asian international finance centres, with Singapore and Hong Kong especially well-positioned,” comments Mohit Mehrotra, Monitor Deloitte Asia Pacific Leader.

“Singapore, in particular, is highly competitive in the mass affluent and high net-worth segments. It is a Southeast Asian hub servicing many high net-worth individual clients, and can also leverage its status as a major business and lifestyle destination for Chinese clients. It is also a neutral business hub, with a strong track record for innovation, as shown by its first place in the ranking for FinTechs,” adds Mohit.

New business capabilities required

New models of cooperation with clients and local partners, enhanced product offerings, and robust but flexible technological platforms are emerging as business priorities in the competition among global private wealth managers located in wealth management centres.

“To stay ahead of the competition, leading wealth managers must be capable of orchestrating and integrating different best-in-class platforms, not only by sourcing products and services along the value chain, but also dealing with partners on an equal footing and developing win-win business models,” says Mohit. “This can be achieved by acting as a niche player and joining an ecosystem – or even becoming the orchestrator of an ecosystem.”

About the Deloitte International Wealth Management Centre ranking

For the fourth time (2013, 2015, 2018 and now 2021), Deloitte has ranked and analysed the world's leading wealth management centres based on their competitiveness, size (international market volume) and performance. International wealth management centres are defined as countries or jurisdictions specialising in and serving private clients from around the world on a large scale. The report is based on Deloitte's own database on private banking and an analytical model that draws on raw data and financial figures from third-party providers.

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