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Laxman Pai, Opalesque Asia:

Global assets under management (AUM) are expected to rebound by 2027, reaching US$147.3 trillion (representing a compound annual growth rate (CAGR) of 5%), said a study.

According to the PwC's 2023 Global Asset and Wealth Management Survey of 250 asset managers and 250 institutional investors, asset managers faced a tough year in 2022, with global assets under management (AUM) falling to US$115.1 trillion, nearly 10% below the 2021 high (US$127.5 trillion). This represented the greatest decline in a decade.

The survey finds that inflation, market volatility, and interest rate movements are by far the biggest concerns for both investors and asset managers over the next 12 to 24 months.

One in six (16%) asset and wealth managers globally are expected to be swallowed up or fall by the wayside by 2027, twice the historical rate of turnover, said the survey.

The report paints the picture of an industry grappling with a set of challenges - digital transformation, shifting investor expectations, consolidation, and "retailisation".

As a result, 73% of asset managers are considering a strategic consolidation with another asset manager in the coming months to gain access to new segments, build market share and mitigate risks.

Firms are also turning to technology to transform, with more than 90% of asset managers already using disruptive technological tools (including big data, AI, and blockchain) to enhance investment performance.

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