Asset management AUM hits record $42.2t

Fund inflows, stronger IPO activity and tax reforms are supporting the sector’s recovery, KPMG said.

Asset and wealth management assets under management (AUM) increased 20% to a record $42.2t in 2025, according to a KPMG report citing data from the Securities and Futures Commission.

The total surpassed the previous peak recorded in 2021. Net fund inflows nearly tripled to $2.07t, marking a third consecutive year of growth.

Hong Kong’s asset management sector also remained internationally diversified. About 56% of assets managed in the city were invested outside Hong Kong and mainland China, whilst investors from other markets accounted for 54% of total AUM.

KPMG said planned reforms to Hong Kong’s Unified Fund Exemption could further support the industry by expanding the range of eligible fund structures and investments.

The revised framework will cover single-investor funds and assets such as private credit, digital assets, commodities and certain overseas real estate. Qualifying carried interest and performance fees will be subject to a 0% effective tax rate at both the entity and employee levels, with the concession applying retrospectively from the 2025 assessment year.

Improved capital-market activity has also strengthened liquidity and exit opportunities. Hong Kong raised $210.5b through 85 initial public offerings in the first half of 2026.

KPMG expects full-year IPO fundraising to reach approximately $350b from more than 180 listings. The city had 439 active listing applications as of June.

International participation also increased, with overseas cornerstone investors involved in 74% of Hong Kong IPOs worth at least US$100m in the first quarter of 2026.

Average daily stock-market turnover reached a record $283b in the first half, rising 18% year-on-year and more than doubling the 2024 level.

Meanwhile, ETFs and leveraged and inverse products accounted for approximately 17% of average daily market turnover. Their combined turnover increased about 27% from the same period in 2025.

Private equity investment in China remained subdued at US$1.6b across 21 deals in the first quarter. However, KPMG said Hong Kong’s stronger IPO market had improved exit prospects and fundraising conditions for private equity managers.

The city’s tokenised investment market also expanded to 13 publicly offered products with combined AUM of $10.7b. KPMG identified stronger interoperability between blockchain platforms and payment systems as the next step for the sector.

Artificial intelligence adoption remains at an earlier stage. Only 23% of asset managers currently deploy AI at scale, although 59% expect to do so within the next 12 months. Data quality, legacy systems, governance and workforce readiness were identified as key constraints.