fullzuloo.blogg.se - Family office finance

where there is availability of skilled labour force and talent pool and.

where the family has existing private banking relationships.

has stable and pro-business Government policies.

has an established financial services industry and well-developed infrastructure.

It meets the criteria that many families are looking for, including: Singapore has increasingly become the jurisdiction of choice for the set-up of a family office and family funds. In many cases, the SPVs are entirely subsumed within the family fund thereby leaving fewer or no SPVs. Hence, wealthy families are increasingly moving towards setting up a “super” holding company (or a family fund) which houses all their financial assets and SPVs. In today’s world, simpler and lean structures are generally more favoured. The set-up of a family fund institutionalises the holding structure for the family’s assets, facilitates succession planning and creates a more efficient and transparent structure.

The setting up of a family office is typically coupled with the setting up of a family fund. Many times, the investment team may also include the next generation family members who not only want to manage their own wealth but also gain experience and build a track record with a view of managing third party wealth in the future. There could be many reasons for setting up a family office but one we see increasingly is that families are looking to in-source the fund management function or at the minimum be more involved in the management of their financial assets. It also brings about challenges of tax reporting and increasing negative attention from the media and tax authorities. Increasingly, families have found that the use of complex structures involving multiple SPVs in different jurisdictions makes management unwieldy and inefficient. Many times this was driven by the need to maintain confidentiality, the perceived simplicity of setting up in offshore jurisdictions, and to achieve ring-fencing through separate SPVs. Traditionally, families have held their investments through holding companies or special purpose vehicles (SPVs). The topic of setting up a family office has now moved from dinner conversations to actual set ups.

Given the growing wealth in Asia, it is not surprising that Asian families are planning ahead and starting to institutionalise the management of their family wealth. Amongst these, entrepreneurs from China have quickly risen to become the world’s second largest billionaire group and nearly one-eighth of global billionaire wealth is from China. The billionaire population has increased by 38.9% with 589 individuals who became billionaires for the first time. The aggregate wealth of billionaires at end 2018 is over a third higher than five years ago, with a margin of $2.2 trillion USD. According to the UBS/PwC Billionaires Insights 2019, over the past five years until 2018, the “billionaire effect” has been evident.