November 21, 2023 | Stamford, CT — Assets managed by Asian institutions shrunk last year for the first time in a decade. Amid these challenging market conditions, Asian asset owners sought out the stability of large, established and reliable investment managers like Allianz Global Investors, the 2023 Greenwich Quality Leader in Asian Investment Management. 

In 2012, institutions across the Asia-Pacific region managed slightly more than $8 trillion and that AUM grew every year for the next decade, almost doubling. The growth trend abruptly reversed course last year, with total AUM dropping to approximately $17 trillion in in 2023 from $17.4 trillion in 2022. 

The drop in institutional AUM is bad news for asset managers competing for mandates in Asia and the results of the 2023 Coalition Greenwich Asian Investment Management Study show that demand for new managers is expected to decline as many institutions adopt a cautious stance and pull back on hiring amid the volatility.

Despite the slowdown in hiring, several important trends still point in a positive direction for the industry. For starters, the total amount of assets available to external managers actually increased modestly last year, from about $3.8 trillion to $4.0 trillion, keeping the 10-year run of growth in outsourced assets intact. 

“Those outsourced assets are coming from a broader group of institutions,” says Arifur Rahman Senior Relationship Manager at Coalition Greenwich. “The result is a more open and diverse marketplace for asset managers competing for mandates and assets.”

Next, the softening demand for new managers is being driven by equities. In both fixed income and alternatives, the share of institutions expecting to hire a new manager in the next 12 months actually increased from 2022 to 2023. Demand will be driven by private debt. 

“More than two-thirds of Asian asset owners expecting to adjust strategic asset allocations in the next three years are planning to boost allocations to private debt,” says Parijat Banerjee, Relationship Director at Coalition Greenwich.

2023 Greenwich Quality Leaders in Asian Institutional Investing
The 2023 Greenwich Quality Leader in Asian Institutional Investing is Allianz Global Investors. Allianz Global Investors stand out by helping clients navigate challenging conditions with proactive communications, market updates and strategic advice.