This is especially true for Asia, where the majority of the rise in single family offices (SFOs) has occurred in the last decade, and where cities such as Singapore and Hong Kong continue to acquire international acclaim. Singapore is one of Asia’s top private banking and asset management hubs.
Location is Appealing
According to hubbis, an Asian asset management web service, the origins of asset owners that set up SFOs and Family Trusts in Singapore are now diversified. A increasing number of European families are establishing SFOs and Family Trusts in the country. Singapore is a strong, politically stable country with a transparent legal system and a supportive and responsive government that encourages private equity market expansion.
Investors are also attracted by a number of incentives that enable efficient asset transfers and the consolidation of SFO investments, as well as one of the world’s most competitive tax systems that does not levy inheritance or capital income taxes. Many families value the sense of familiarity provided by the region’s strong financial licencing, which include common reporting criteria similar to those of the EU and the US, as well as the experienced, multilingual employees.
SFO in the Global World
Senior Minister Tharman Shanmugaratnam stated in 2021 that the total wealth of SFOs in the region is approximately $20 billion and that this value will continue to expand, providing jobs throughout the financial industry.
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The increased demand for family office expertise will raise the demand for independent trusts, legal companies, and accountancy firms. More top private bankers are likely to prefer to work for an SFO rather than a bank. The majority of Asian households are first or second generation. This means that the majority of SFOs are currently dealing with the initial asset transfer and considering how to maintain harmony throughout the process. Because an OFS and a transitional plan can resolve or avoid many conflicts among family members.
The requirements of younger entrepreneurs and second-generation asset holders generated a beneficial shift in market attitudes and established a precedent for best practises. These people are already more internationally mobile; many of them have numerous passports or tax residences and profit from globalisation and the increased opportunities it brings.
As asset owners’ needs change frequently, it is critical to recognise new thinking and service. Singapore, as a region, has recognised and acted on this. As a result, the country provides a competitive advantage that entices families to take use of the region’s SFO benefits.
