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UBS, Morgan Stanley lead wealth managers with record $2 trillion
[FRANKFURT] UBS Group AG and Morgan Stanley increased the assets they manage for the world's wealthiest people to more than US$2 trillion for the first time, according to a study.
Assets under management at Zurich-based UBS rose 3.5 per cent to US$2.04 trillion last year, the most globally, according to an annual study by Scorpio Partnership, a London- based consulting firm. Morgan Stanley ranked second with US$2.03 trillion as assets grew 6.1 per cent.
"The global wealth management industry had a solid business year in 2014 in terms of financial results for the operating model," Scorpio said. "In spite of financial market uncertainties and currency volatility, most lead players experienced overall growth in client volumes." The wealth-management industry managed US$20.6 trillion in investible assets of high net worth individuals at the end of December. The top 10 managers accounted for 47 per cent of the market, with UBS controlling 9.9 per cent, Scorpio said.
While UBS ranked first for the third straight year, JPMorgan Chase & Co increased assets 19 per cent to US$428 billion, the fastest-growing of the top 10 managers. BMO Financial Group of Canada rose 10 places to 11th, as acquisitions helped assets surge 80 per cent to US$326.4 billion.
Average growth in assets under management for more than 200 firms in the study climbed 3.4 per cent, compared with almost 15 per cent in 2013. Cost to income ratios rose 90 basis points, or 0.9 percentage point, to 84.4 per cent as operating efficiency declined.
"The operating model is facing major growing pains to accommodate the expectations of financial groups for wealth management divisions to deliver sustained high margin results," said Sebastian Dovey, managing partner at Scorpio.
A number of firms, mostly based in Europe, were adversely affected by the euro's weakness, Scorpio said. BNP Paribas and HSBC Holdings, ranked eighth and ninth globally, saw assets shrink by 6.2 per cent and 4.5 per cent, respectively.